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Hawaii Home Investors Math
Old 07-20-2008, 10:58 PM   #1
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Hawaii Home Investors Math

Originally posted by Clifp in "Hawaii's Home-buyers mortgage math" thread locked down by the moderators! (see link below.)

"I have looked at the development a several years ago 2 bdr were going for 400K and I thought it was overpriced. The nice thing about Real Estate is you can ask any price you want for property the trick is finding somebody to pay it.

My house in St. Louis Heights 3 time larger is on a rim lot, with a spectacular Diamond head view. (I can even see those units) and it it was appraised about between 800-900K and it was built at the same time."

Here's those two bedrooms, asking $849,000! One bedrooms still in the $400,000 range. Makes the $400,000 price seem like a deal now!
www.HawaiiInvestor.com
Hawaiian Island Homes Ltd.
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Old 07-21-2008, 11:27 AM   #2
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Bob, Thanks for those links, however a couple of things that spring to my mind. The asking price is $849k which really means nothing, it's what it sells for that counts. The last 2bed in that complex sold a year ago for $707k, so until you actually get a similar unit selling for more $707k would you not consider that as being the benchmark rather than someone's desire for $849k?

However, as the 1 bed currently listed is going for $395k, when all previous sales have been over $400k would you not consider this a sign of a declining market?

I am only a fringe dweller on the Honolulu market, I follow it as I thought of buying there, but don't really consider I know it, so my comments are made from that basis. I am attaching a link to a report I received recently from Prudential on what has happened in the Honolulu market for 2008.

http://www.prucentral.com/AgentEmail...dYear08Web.pdf
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Old 07-21-2008, 12:27 PM   #3
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Bob, Thanks for those links, however a couple of things that spring to my mind. The asking price is $849k which really means nothing, it's what it sells for that counts. The last 2bed in that complex sold a year ago for $707k, so until you actually get a similar unit selling for more $707k would you not consider that as being the benchmark rather than someone's desire for $849k?

However, as the 1 bed currently listed is going for $395k, when all previous sales have been over $400k would you not consider this a sign of a declining market?

I am only a fringe dweller on the Honolulu market, I follow it as I thought of buying there, but don't really consider I know it, so my comments are made from that basis. I am attaching a link to a report I received recently from Prudential on what has happened in the Honolulu market for 2008.

http://www.prucentral.com/AgentEmail...dYear08Web.pdf
DM If I read your link correctly then Waikiki condos are up 2% and Diamond Head is up over 5%! I totally agree with you about asking prices but most people here seem to focus on that or previous sales price when what they need to look at is CURRENT market value.

I didn't even look at the previous sales since I'm no longer interested in that complex and the sales are also not identified by unit number so that $707K sale could be the worst location. The two bedroom townhomes are either the 1st and 2nd floor or the 3rd and 4th floor. The listing is on the 3rd and 4th so it is in the top 50% of location and then where on those floors would make a difference. I did look at them a few years ago when they were selling for $600K and would have purchased if I had not been dealing with my Dad. Same thing about the one bedroom, location and condition.

Well, I spent 3 weeks going to open houses, Sunday and Tuesdays, and riding around in my Realtors Jag!!!. No deals (except one) but lots of good prospects. I have plan b,c,d, & e, if my financing doesn't go through. There are some nice properties on the market but those are the ones that are moving after maybe a month on the market. Gives you time to make an intelligent choice but need to move on it if you're serious.

Couldn't get into several properties because the owners were tired of showing only to get low ball offers that had no basis in reality. Amateurs are screwing up the market as much as the doom and gloom journalists.

Now on the other side of that, unrealistic sellers are not doing themselves any good. A property I was interested in came on the market a year ago. It was listed at $467,700 and supposedly got a $450K offer right away. The highest sale in the building had been $410K. They turned down that offer. I waited until November and made an offer over $400 sight unseen thru their cut rate realtor who did everything he could to get me to a full commission listing. No sale. It came back on the market a couple months ago at $435K with a real Realtor and I had my normal Realtor take a look and we made an offer again above $400K. They countered at $433K!!!! No sale although I offered to pay whatever market they could support. Still on the market when I arrived in Honolulu 6/21 so I took my first actual look. Online it looked pretty good and my Realtor described it pretty well but on actual inspection I noticed their laminate floor installation had not been staggered so there was a line clear across the floor every 4 feet. When they installed the new countertop in the pass thru they figured it was easier to gouge the wall that cut the laminate countertop!! Little things that I could fix or rent as is but definitely made me decide not to go as high as I had previously thought. So two 1 bedrooms sold while I was there for about $300K. The highest sale had been $301K The difference between 1 & 2 bedrooms has been about $70K to $107K difference. So my thinking is that the two bedroom should sell for no more than $408K! Their realtor said they had just turned down an offer for $420K. I just saw them online and they've reduced to $419K. I'd be interested but I'm sure they'd refuse a $410K offer!! Go figure.

DM If you're looking, I think now is a great time to find the best on the market. You may find a "deal" in a few months but it may not be the property you want long term.
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Old 07-21-2008, 12:58 PM   #4
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Honobob, interesting scenario you have been involved in. To me, I find it amazing that people will force themselves into a situation where there property is on the market for months on end in an effort to get an extra few thousand $'s. It might be worth it at month 1, however by month 6 they must be tired of it.
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Old 07-21-2008, 03:48 PM   #5
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Originally Posted by DangerMouse View Post
Honobob, interesting scenario you have been involved in. To me, I find it amazing that people will force themselves into a situation where there property is on the market for months on end in an effort to get an extra few thousand $'s. It might be worth it at month 1, however by month 6 they must be tired of it.
Well to be fair to the seller he was allowed to list at $57,700 above the highest sale by a cut rate realtor in a market that perception at least was changing. Since I own a unit in the building I know he was just fishing at first. The $450,000 offer came too soon but the Realtor should have warned him that he should grab it and worry that the appraisal comes in high enough!

But then when he relisted at $435 and refused a $420 offer, then it's all on him. Greed. Although when I was talking to his new Realtor, she was still trying to use comps that weren't and couldn't back them up when challenged.

It's still a great property at $400 and even $410.
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