Why Potential Homebuyers Should Be Prepared to Spend More
In Honolulu’s competitive housing market, many homes sell for more than the asking price.
Plantation home on Hinano Street.
In August 2017, 362 single-family homes sold on O‘ahu. Of those, 112—a bit more than 30 percent—sold for more than the listed price. With so much competition for single-family homes and an average of only 16 days on the market right now, buyers who find their dream home know they need to do whatever it takes to seal the deal.
How much more are these homes selling for? It varies, but homes priced up to $500,000 that sold for more than asking price typically did so by an average of $5,000. At $600,000 to $800,000, the amount above asking price people were willing to spend was $10,000, although a few went up to $35,000 above asking price. When prices hit $800,000 to $1 million, it wasn’t uncommon to see $25,000 to $50,000 above asking price. And when you hit $1 million, some homes sold for $1.10 million to $1.21 million.
In August, most of the homes that sold above asking price were in Kailua, although Kāne‘ohe, Hawai‘i Kai, Kapolei and Diamond Head had their share as well.
Take this cute little plantation home on Hinano Street, near Diamond Head: The sellers asked for $995,000; it sold for $1.21 million.
What did the homes that sold for more than asking price have in common? While their conditions varied, they were all in desirable neighborhoods.
We spoke to John Climaldi of Hawai‘i Life, an experienced agent who represented a buyer in the purchase of a home in Hawai‘i Kai in August. The home, a fixer-upper listed for $619,000, sold for $720,000.
“Even though it looks like it was way over asking from the list to sold ratio, in reality the home was priced way under market value,” said Climaldi. “This success story was more about having buyers that were well informed, ready and prepared to react at a moment’s notice, and willing to look beyond the repairs to get a house in the neighborhood they wanted at a price they could afford. In this hyper-elevated market, it pays to look at the properties that need work. That is where the value is, and possibly less competition.” Climaldi’s buyers, like other winning bidders in Honolulu’s competitive market, looked beyond the list price to the actual value of the home.