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As the pandemic continues to impact the economy, the housing market has been on a rollercoaster ride. For many, the idea of purchasing a home in Hawaii may seem out of reach. However, as we move into the next few years, things may start to shift. In this post, we’ll take a closer look at the Hawaii housing market forecast for 2023 and what buyers and sellers can expect.
The Current State of the Hawaii Housing Market
Before we dive into the forecast for 2023, it’s important to understand the current state of the Hawaii housing market. According to the Hawaii Association of Realtors, the median sales price for a single-family home on Oahu was $950,000 in May 2021. This represents an increase of 24% from the same time last year.
The demand for housing in Hawaii has been high, with limited inventory and fierce competition among buyers. The pandemic has only exacerbated this issue, as many people have been drawn to Hawaii’s natural beauty and favorable climate. Additionally, low interest rates have made it more affordable for buyers to purchase homes.
Rising Interest Rates
One factor that may impact the Hawaii housing market in 2023 is rising interest rates. While rates are currently low, they are expected to increase over the next few years. According to a forecast from Freddie Mac, 30-year fixed mortgage rates are expected to rise to 3.4% in 2022 and 3.8% in 2023.
This increase in interest rates could make it more difficult for buyers to afford homes, which may lead to a decrease in demand. However, it’s important to note that even with rising interest rates, Hawaii’s housing market is still expected to remain strong.
Supply and Demand
As we mentioned earlier, the demand for housing in Hawaii has been high, with limited inventory. This has led to fierce competition among buyers and a rise in home prices. In 2023, we may start to see an increase in supply as more homeowners list their homes for sale.
According to a forecast from Zillow, the number of homes for sale in Hawaii is expected to increase by 8% in 2022 and 15% in 2023. This increase in supply could help to balance out the market and make it less competitive for buyers. However, it’s important to note that even with this increase in supply, the demand for housing in Hawaii is still expected to remain high.
New Construction
Another factor that may impact the Hawaii housing market in 2023 is new construction. As demand for housing continues to rise, developers may start to build more homes to meet the needs of buyers. According to a forecast from the University of Hawaii Economic Research Organization, housing permits are expected to increase by 17% in 2022 and 19% in 2023.
This increase in new construction could help to alleviate some of the pressure on the housing market and provide more options for buyers. However, it’s important to note that new construction may not necessarily lead to more affordable housing options.
Remote Work
The pandemic has changed the way many people work, with more companies offering remote work options. This shift may impact the Hawaii housing market in 2023, as more people may choose to relocate to Hawaii now that they can work from anywhere.
According to a survey from Zillow, 1 in 10 Americans say they have already moved or plan to move due to the ability to work remotely. This trend could lead to an increase in demand for housing in Hawaii, as more people seek out the island lifestyle.
Impact on Prices
So, what does all of this mean for home prices in Hawaii? While it’s impossible to predict the exact impact of these factors, it’s likely that we’ll continue to see rising home prices in Hawaii over the next few years.
According to a forecast from the University of Hawaii Economic Research Organization, the median sales price for a single-family home on Oahu is expected to reach $1.15 million in 2022 and $1.2 million in 2023. While this represents a slower rate of growth than we’ve seen in recent years, it’s still a significant increase.
What Buyers and Sellers Can Expect
For buyers, the Hawaii housing market in 2023 may be less competitive than it is currently. With an increase in supply and potentially decreasing demand, buyers may have more options and less pressure to make a quick decision.
However, buyers should still be prepared to pay a premium for homes in Hawaii. It’s likely that home prices will continue to rise, and competition among buyers may still be high, especially for desirable properties.
For sellers, the Hawaii housing market in 2023 may be a good time to list their homes. With an increase in supply and potentially decreasing demand, sellers may have a better chance of selling their homes quickly and for a good price.
However, it’s important for sellers to be realistic about their expectations. While the Hawaii housing market is still strong, it may not be as frenzied as it has been in recent years. Sellers may need to be prepared to negotiate with buyers and make some concessions.
Conclusion
The Hawaii housing market forecast for 2023 is a mixed bag. While we may see an increase in supply and a decrease in demand, home prices are still expected to rise. Buyers and sellers alike should be prepared for a competitive market, but with some potential relief.
As always, it’s important to work with a knowledgeable real estate agent who can guide you through the buying or selling process. With the right strategy, you can navigate the Hawaii housing market and find the home of your dreams.
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What can buyers and sellers expect from the Hawaii housing market in 2023? Read on to learn about rising interest rates, supply and demand, new construction, remote work, and more.
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Hawaii housing market forecast 2023, Hawaii housing market, Hawaii real estate, Hawaii real estate market, Hawaii home prices, Hawaii home sales, Hawaii homebuyers, Hawaii homes for sale, Hawaii home listings
