Here is our 05/9/2016 e-mail update. It is sent after the statistics for the preceding month have been posted on the Board of Realtors website. You can find previous newsletters by visiting www.stott.com/news.
Oahu’s median prices continue their steady climb. The median price for single family homes was $720,000 in April (6.7% higher than April, 2015) and the median price for condos set an all-time high of $389,500 (5.1% higher than April, 2015). Housing demand continues to strengthen against a dwindling supply of available homes. Closed sales and pending sales were higher than 2015 numbers. There are currently only 2.8 months of inventory of single family homes and 3.1 months of remaining inventory of condos.
An iconic radio partnership is ending on May 15th after 33 years on the morning airwaves as Hawaii’s top rated program. Larry Price, has announced that he will be leaving the “Perry & Price Morning Show” and launch a new sports show with Rick Hamada on FOX Sports 990. Michael W. Perry will continue hosting the morning radio show solo.
Hawaii’s tourism industry received another boost as Virgin America started daily flights between Los Angeles International Airport (LAX) and Honolulu International Airport on May 5th. Additional flights between LAX and Kahului, Maui will begin on June 14th.
Castle & Cooke’s long-delayed 3,500-home Koa Ridge master-planned community recently won a Hawaii State Supreme court ruling in favor of the development on its third attempt. The development is essential to helping provide the additional housing needed for Hawaii’s anticipated population growth over the next decade. The development will consist of single and multi-family homes, a mixed-use center, medical center, hotel, light industrial buildings, parks, an elementary school, recreation center, and churches.
A new organization, The Oahu Alternative Lodging Association (OALA) formed in February and has started meeting with the City and County of Honolulu to discuss viable solutions to the currently illegal vacation rental industry. The group is suggesting compromises like providing vacation rental licenses in return for higher property tax rates at those properties. OALA plans on holding community events around the island to discuss the issue with people for and against vacation rentals. In related news, Airbnb revealed that it has 10,000 active listings in the Hawaiian Islands. Apparently, some of those 10,000 listings are offers for guests to stay in tents as glamorous camping, known as “glamping” grows in popularity. Airbnb has announced that it is removing the glamping listings that are determined to violate Hawaii’s laws.
The state legislature appears to acknowledge the value that Airbnb can provide as a source of tax revenue by allowing the online alternative accommodation company to serve as a tax broker for the state. The bill has been forwarded to Governor David Ige for signature.
The Ritz-Carlton Residences, Waikiki Beach, started taking reservations for the hotel component of the condominium-hotel complex and will welcome hotel guests starting June 1st. The rates on the hotel website range from $649 per night to $2,449 per night.
Hawaii received some positive economic news. Hawaii enjoyed a 31% increase in product exports from the state. Leading exports included shrimp, bottled water, chocolate covered macadamia nuts, and papayas.
The Federal Government has continued its recent trend of restricting individual property rights in the form of the Department of Housing and Urban Development’s (HUD) controversial use of “disparate impact” to rule that landlords are no longer allowed to use a criminal record as a legal reason to turn down a rental application. HUD’s ruling states that some races have a higher incarceration rate and that considering an individual’s criminal record as part of checking an applicant’s background can be considered discrimination.
The Affordable Care Act (ObamaCare) claimed another victim when Hawaii 1st Circuit Court Judge Karen Nakasone signed an order to place Honolulu-based health insurer, Family Health Hawaii into liquidation. The insurer started up in 2013 to provide residents additional choices in health care and found itself unable to overcome obstacles from mandates required by ObamaCare.
The Hawaii state Department of Transportation is wrapping up a $10 million pier improvement project at Honolulu Harbor that includes relocating emergency response vessels during oil spills to nearby piers in preparation for additional upgrades that will transform an old military reservation into an overseas container terminal. The new terminal will have berthing capacity for two ships and remove some of the congestion at the terminals located on Sand Island.
Hawaii Gas, the state’s only regulated gas utility, has reduced its estimate for a new liquefied natural gas (LNG) terminal by 1/3 to $200 million. An 18-month study showed that Oahu electricity customers would have saved $132 million in fuel costs by switching from oil to natural gas. Hawaiian Electric Company (HECO) has a separate plan for bringing bulk LNG to the islands for $234 million. The projects would still need the approval of the Hawaii Public Utilities Commission (PUC) and the Federal Energy Regulatory Commission. PUC recently approved Hawaii Gas’s application to increase LNG deliveries from one LNG container a month to 2 LNG containers per day. Governor David Ige has argued against the money saving projects because he feels that the efforts would distract the state from his goal of providing 100% of the state’s electricity from renewable sources.
Political drama surrounding the Honolulu Authority for Rapid Transportation (HART) reached a fevered pitch in April with Ernie Martin, Honolulu’s City Council chairman, called for the resignation of HART Board Chairman Don Horner and HART Executive Director Dan Grabauskas for failing to contain cost overruns associated with the struggling rail project. Don Horner, a volunteer, decided that he no longer needed the negative attention and resigned days afterwards. In his resignation letter to Mayor Kirk Caldwell, Horner stated, “too often in politics, the focus becomes shooting the messenger of unpleasant news rather than collaboratively working on solutions.” Former U.S. Representative Colleen Hanabusa was recently named Don Horner’s replacement. A financial audit released on April 15th to the Honolulu City Council was extremely critical of HART by saying that the agency was using outdated financial figures and that the latest estimates of how much over budget the project is are most likely too low and will most likely climb as time goes on. Mayor Kirk Caldwell is trying to distance himself from the project, however, Hawaii columnist David Shapiro reminded newspaper readers that Caldwell made himself the “point person” on rail when serving as Mayor Mufi Hanneman’s managing director. Kirk Caldwell led the campaign to convince wary taxpayers that the project should be approved with unrealistic cost projections and construction timelines. Kirk Caldwell was the first to publicize the “sugarcoated numbers” that he is now complaining about.
Oceanit, a Honolulu-based engineering firm, has been awarded a patent for creating a system that targets delivery of cancer drugs to increase the effectiveness of the drug while reducing the cancer drugs’ side effects. The Nanobes system has the potential for other industries outside of the drug delivery business and Oceanit is exploring those possibilities with various business partners.
Maui-based Kolani Distillers signed a contract to stock Hawaii Wal-Mart shelves with their Old Lahaina Rum this summer. Kolani Distillers was the only company from Hawaii to win a contract from Wal-Mart’s Open Call for U.S.-based products. The development continues a trend of strong growth in Hawaii’s local brewery, wine, and spirits industry.
Turtle Bay Resort finalized a $6 million dollar conservation easement with a collaboration led by the Trust for Public Land that will preserve 468 acres of land on Oahu’s North Shore for farming and agricultural use. This is the second conservation agreement for Turtle Bay Resorts who hopes to increase tourist revenue by leveraging farm to table offerings.
Looking for great pizza and beer during your next visit to Oahu? J.J. Dolan’s, a downtown Honolulu pub, continues to rack up awards for the best tasting pizza in the state. Not in the mood for pizza, try Me’s Bar-B-Que, a Korean barbecue restaurant in Waikiki. It just landed on the culture website Thrillist’s 2016 list of “The 33 Best BBQ Joints in America.”
Hawaii fun fact: On average, each person in Hawaii consumes five cans of SPAM per year. Seven million cans of SPAM are sold in Hawaii every year, making the state Hormel’s #1 market for SPAM. The Waikiki SPAM Jam was held on April 30, 2016 to celebrate Hawaii’s continuing love affair with the canned meat.
Solar Impulse 2, the solar powered plane that arrived from Japan on July 3rd of last year departed Honolulu on April 21, 2016 and arrived at Moffet Field in Mountain View California on April 24, 2106. The pilots, Bertrand Piccard and Andre Borschberg, have logged over 317 hours in the air and traveled over 24,000 km in their quest to travel around the world using the sun’s energy. The plane stayed in Hawaii over the winter to repair the batteries and to wait for longer days before making the trip to California. The plane then completed the next leg of their flight from Mountain View, CA to Phoenix, AZ on May 2nd and 3rd. You can continue following the pilots’ around the world quest at www.solarimpulse.com.