Ewa Oahu, Kapolei Housing Market Suddenly Gets Hot

Aug. 18, 2010 - PRLog -- Berton Hamamoto has been amazed by the bidding wars he has been seeing for homes in Ewa and Kapolei.

The areas of Oahu that have been hit hardest by the foreclosure crisis are at the center of an uptick in sales, as falling prices and sellers looking to get out from under hefty mortgages create opportunities for first-time home buyers and members of the military.

“Almost every single short sale that I’ve pulled up so far, there’s been multiple offers,” said Hamamoto, president and principle broker of Aiea-based Property Profiles Inc. “In other words, the low-priced stuff is really hot.”

Hamamoto had one client looking to buy in Ewa Beach who put offers in on 14 different properties before getting one accepted.

A lot of the listings that are labeled active in the Multiple Listing Service already may have multiple offers or are even in contract.

The active label may remain until the buyer gets past a home-inspection period or, in the case of a short sale, until the bank approves the sale.
“Agents are getting very frustrated, especially out there where they may have to call five agents to find one [listing] that is active,” said Brian Benton, a broker-in-charge for Prudential Locations and president of the Honolulu Board of Realtors.

While all of Oahu has been seeing sales increase lately — single-family home sales rose 33 percent islandwide last month alone — the Ewa-Kapolei region has seen a boom in the past two months.

There were 32 single-family homes sold in January, a 68 percent increase over January 2009, and 49 homes sold in December, a 48.5 percent improvement over December 2008, according to statistics from the Honolulu Board of Realtors.

Meanwhile, prices during those months fell. December’s median price for a single-family home in the region was $420,000, a 4 percent decline from $438,000 in December 2008, and January’s median price of $435,000 was a 6 percent drop from January 2009, when it was $465,000.

Some of those price differences are due to short sales, where a seller prices a home lower than what is owed on the mortgage, often the last resort before foreclosure actions start.

Attilio Leonardi Jr. and Adrienne Lally of Re/Max Honolulu in Kapolei have handled more than 60 short sales in the past two years.

And those numbers are going up, Leonardi said.
Of the 159 single-family homes in the Ewa Plain that are listed in the MLS as active, 65 (41 percent) are short sales.

And 41 of the 98 homes (42 percent) that are listed as in escrow or pending also are short sales.

“Within the last two years, it’s been a geometric progression, or rapidly escalating progression,” said Leonardi, noting that his firm handled 40 short sales last year alone.

He attributes a lot of the current sales to the $8,000 first-time home buyer’s tax credit, which Congress extended to sales that are in contract by April 30.

That, combined with the lower prices — there are a number of single-family homes on the market for less than $400,000 — has made Ewa and Kapolei an attractive option for first-time buyers and military families using mortgages backed by the U.S. Veterans Administration, which can offer 100 percent financing, he said.

“The affordability is pretty good, especially Ewa Beach,” Leonardi said.

Ewa Beach also is one of the few areas on Oahu where buyers have a choice between resales of relatively new homes and new construction, he said.

Leonardi recently had a buyer hesitate about signing a counteroffer on a resale after driving by one of the Gentry projects in Ewa Beach.

“That’s a good thing for a buyer because the resale market is creating a tremendous downward pressure for pricing,” he said.
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