Buying in Honolulu: Low Inventory and Expensive Price Tags
Located along the south coast of Oahu, the capital of Hawaii is a hotspot for tourism and business, but buying a home there is costly. The median value of homes in Honolulu is $673,700, and the median price of homes listed for sale is slightly lower at $629,000. Values are comparable to the highly competitive markets of Seattle, WA; Lahaina, Maui; or Kalaheo, Kauai. Throughout the past year, home values have risen 4.8 percent, with appreciation expected to settle at 1.9 percent over the next 12 months.
Residing in Honolulu offers access to jobs and nightlife without battling traffic, but suburbs outside the city present more economical housing opportunities for buyers.
Just 16 miles northwest of Honolulu is Waipahu, where about 67 percent of the residents are homeowners and the median age is 39, slightly younger than Honolulu's median of 43. The median home value is $636,300, and the median price of the homes listed for sale in Waipahu is $529,000 - a great discount from Honolulu. As an added benefit, Waipahu is a much safer community compared to the capital city. Home values soared 6.3 percent over the past 12 months but are forecast to appreciate just 2.2 percent over the next year. So, building equity will not be immediate.
Farther west, about 22 miles from Honolulu, is the younger community of Kapolei, with a median age of just 33 but a high homeownership rate of 69 percent. Here, the median home value is $622,800, and the current listings are priced a bit steeper at $667,250. Similar to Waipahu, values in Kapolei experienced extreme appreciation throughout the past year at 6.8 percent, but they are projected to rise at a slower rate of 2.5 percent this year. Kapolei is also much safer than Honolulu and on par with Waipahu.
The waterfront community of Ewa Beach is 21 miles west of Honolulu and is the safest of all the cities listed. A whopping 82 percent of residents are homeowners while the median age of all residents is a youthful 32. The median home value in Ewa Beach is $592,900 - far reduced from Honolulu. Ewa Beach offers the most inventory out of the listed suburbs with a current median listing price of $633,000. Like the other markets, home values soared throughout the past year by 7.3 percent and should taper to 2.8 percent over the next year.
A bit farther from the heart of Honolulu is Waianae, about 32 miles northwest. The community hugs the western shore of the island and is similar to Kapolei in safety. The median home value in Waianae is $400,500 with homes currently listed for sale at a median price of $367,000, by far the cheapest of these five areas. Home values skyrocketed 8.1 percent over the past year but are anticipated to level off at 2.7 percent in the coming year. Homeownership rates are slightly lower at 56 percent, while the median age for residents is a young 32.
Depending on buyer interest, the home prices, typical age of residents or safety perks of these suburbs may inspire shopping outside of costly Honolulu.