First look: Architect Magazine showcases Fannnie Mae’s new corporate digs

First look: Architect Magazine showcases Fannnie Mae’s new corporate digs

It’s big and beautiful and it saves the GSE money

Fannie Mae: Mortgage lenders unnecessarily restrict credit

Higher credit scores, additional documentation most common

Homeownership rate drops to 48-year low

Despite record sales, fewer Americans own homes
Lending / The Ticker

Living the Hawaii life is about to get more expensive

Median home prices in Honolulu expected to reach $700,000 for the first time ever

/ Print / Reprints /
| Share More
/ Text Size+

Hawaiian home prices and mortgage rates are expected to increase over the next two years, making it a little more expensive to live the “lei’d” back lifestyle.

The latest forecast by the University of Hawaii Economic Research Organization projects that single-family home prices on the Oahu island, where Honolulu is located, will break the $700,000 barrier for the first time ever and reach $710,500 in 2014, a 9.8% increase over 2013’s median of $647,000. 

The figures were included in UHERO’s Hawaii Construction Forecast report, which was released Friday. “On Oahu, prices have now eclipsed their pre-recession highs, but, on the Neighbor Islands, they have recovered less than half of the decline,” the report said. The report explained that prices have been rising because of low housing inventory, low mortgage rates and an improving job market.

To compound to the affordability challenges for working families, mortgages rates are expected to creep up. Gone are the days of sub-4%  mortgages we saw just a year ago.

“One factor supporting strong current demand for homes is historically low interest rates and the anticipation that those rates won’t be around much longer,” the report said. “Mortgage rates began to turn upward last year and are running a full percentage point higher than they were at the end of 2012. We expect rates to continue to rise gradually over the next several years.”

UHERO projected the 30-year conventional rate to average 4.6% this year and edge up to above 5% in 2015. “Low mortgage rates along with falling home prices boosted home affordability in the islands during the recession and early recovery period,” UHERO said. “As rates and prices rise, affordability will begin to erode, although healthier family incomes will moderate this impact.”

Read full story

Recent Articles by Ben Lane

Comments powered by Disqus