Earlier this week I drove by the new H1 freeway exit in Kapolei. I didn't think they were going to open that for a couple more months, but it is now open.  It allows people in Kapolei to get off earlier and releives some of the congestion at Fort Barrett. 

That's more good news for the West side, even as traffic in Ewa Beach is also moving much faster.  Now if we can just keep the new construction to a minimum, there won't be as much new traffic in the future.   

Now do we really still need a $5billion Rail ?  I say no, along with many others.  I bet if people on the West Side could vote now that they have seen the difference, the vote would be different.

1289  and 1864.  That's the number of homes and condos available on Oahu, respectively.  Those are the lowest numbers since fall 2005.  The lowest number of homes available in 2006-2009 so far was 1600.  Perspective - it's only 5.4 months of inventory!

No wonder my buyers have had a hard time finding homes to buy, while my sellers have been selling quickly with multiple offers. No wonder my clients looking for a water front townhome in Hawaii Kai are having a hard time.  Usually there are a dozen to choose from, but not anymore. 

Is it the low rates? The tax credit? The economy bouncing?  Whatever it is, the inventory only proves again that Oahu is the best place to buy and hold real estate!

Yesterday I showed a few clients 17 homes around Kailua, Kaneohe, Mililani, and Makakilo.  I drove a total of 180 miles from my home in Aina Haina, a small neighborhood in the Diamond Head region.

After viewing all these homes I can say for sure that prices have dropped substantially, but inventory is very low for anything really good.  Any home priced right and in good condition will sell in just a couple weeks.  I say that because I was actually planning to view 20 homes, but 3 of them sold before Saturday.

Plus, 2 of the homes I showed yesterday already had offers on the .  One of them had 2 offers.  The price range? All between $650k and $1million.  Inventory overall is very low, and for a nice condition home, extremely low.

I left my house at 8.45am and got home at 7pm, tired but very satisfied from a good day's work. I love my job.

The Rail system in Honolulu is a massive financial black whole even before it has begun.  With a budget already falling so short that government employees are forced to take furloughs, and with tax revenues down and falling even more, the City and County. and the State cannot afford this $5billion project. As a member of the Honolulu Board and the Hawaii Association of Realtors, I think it's time these two associations take a stand against the Rail project, before more tax dollars are wasted and more debt is ammassed. Already the City (read: Mayor Mufi) has used our tax dollars to advertise on the radio and TV, attempting to turn public opinion in favor of this project.  Already money has been spent on planning, researching, etc. It’s time to stop. Last fall, with a vote of just 51%, the measure passed the public vote, but that was before last year's economic collapse, and before most people realized that the Rail project would be so grossly under funded before it ever broke ground. Now is the time to fight this project before our City is plunged into debt that it will never repay.  There are dozens of reasons to stop the rail project, but the only one that should matter now is the money simply isn't there. Mayor Mufi promised that this project would be fully funded, and now he cannot fulfill that promise as tax revenues have fallen faster than anyone expected. 

Honolulu Board and Hawaii Association of Realtors - Your members do NOT support Rail, so neither should you!

Last week, the Federal Open Market Committee announced they were leaving rates unchanged.  According to the statement released, in an effort to "provide support to mortgage lending and housing markets" they will "purchase a total of $1.25 trillion of agency mortgage-backed securities and up to $200 billion of agency debt." 

However, what's important is that "they expect to gradually slow the pace of these purchases in order to promote a smooth transition."

That means that eventually rates are going up.  We don't know when, as it depends on how fast the Fed decides to stop buying the MBS.  Last year in an effort to stimulate housing, the Fed began purchasing the oversupply of debt.  Without this help from the Fed, rates would have moved higher already.

Most likely, and hopefully, the Fed will wait until the economy and housing markets seem like they can handle higher rates, or until inflation begins to kick in.  Either would be fine, as they are all too related at this point in the deflationary cycle. 

Rates going up later means buying a house is cheaper now than it will be then.  If rates go up even 1%, it would be like a $500k house costing you $550k instead.  If they go up 2%, well you get the idea.

The stats are not posted yet, but I can tell just by searching for clients that inventory is down overall. I'm sure the stats, which come out on the 1st, will show an even smaller amount of homes for sale, even as sales picked up yet again.

 Case in point - I have a buyer waiting for a Kuapa isle listing on the water.  None are available.

I have another client looking for a home in Ocean Pointe, Ewa Beach. Can't find except the 5 short sales.

Multiple Buyers looking all over the island, up to $5million, and it's very hard to find. I have clients looking for $10mil homes on the water and there just aren't as many as there used to be!

I'm back from 10 days in Japan and had a great time with my family. Kids loved Disney Tokyo, but walking about 5 miles a day took a toll on me and the wife.

Now that I'm back I see that I have dozens of buyers and sellers ready to take action. Time to start selling some Hawaii real estate!

I have a client who may be listing a great place in Kuapa Isle shortly.  Let me know if you're interested!

$5 BILLION.  That's $4300 per person in the State of Hawaii to have a Rail System in Honolulu, compared to Phoenix's $180 per person system.  There is no question that we must stop rail now.  Go visit the Stop Rail Now site and see what you can do to participate.

There is also a great post over at Fix Oahu Blog, where Panos says, " The fact is that the project will cost much more because utility relocations, stoppages for iwi (ancient burial grounds) and delays from lawsuits are not included in the costs. Not enough taxes are being collected due to the prolonged slow economy, so property taxes will have to be raised to cover the escalating costs." 

If you have a VA loan and you want to simply lower your rate, did you know an appraisal is not required by the VA?  Some lenders require an appraisal as an in house rule, but the VA doesn't, so you should be able to find a lender who will let you lower your rate without any appraisal at all.

Pretty great deal for anybody with a VA loan that they got more than a year or two ago.

While most people know that VA loans allow military buyers to get into Hawaii real estate with zero down, most don't know that there is a similar loan backed by the USDA (yes, the beef people) that also allows zero down purchases for regular civilians.

The USDA home loan will allow any buyers who make less than $109k/ year to buy a house with no money down. Similar to the VA loan, there is a funding fee of 2%, but other than that, it's quite simple.

If you have more than 5 people in your family, you can actually make a lot more money and still be eiligible.  There is no loan amount limit as long as your debt ratios still qualify.

Just doing the math, a family of 4 with no other debt making $109,000 a year could buy a house of around $500k with zero down. And there is really no other requirement as long as you have a credit scrore over about 620.

This loan is available only the areas that the USDA calls "rural," which on Oahu includes these areas, much of which I don't consider rural at all:

• Village Park and Royal Kunia
• All of Ewa Beach
• Makakilo
• Kapolei
• The Waianae Coast
• Central Oahu starting from Whitmore Village going North to the North Shore
• All of the North Shore
• The North part of the Windward coast, from Ahuimanu to Kahuku
• Waimanalo to Sea Life Park

The USDA loan can be a great deal for buyers of Hawaii real estate, since it has no monthly mortgage insurance, no prepayment penalty, and no max loan amount.  One nice thing is that lenders can order their own appraisals, unlike the VA loan.  That means turn times are faster!

Thanks to Chris at Guild mortgage for teaching me about the UDSA loan.