Luxury Real Estate

By Cedric Choi

SEPTEMBER 2008 STATISTICS FOR SINGLE FAMILY RESIDENCES – HONOLULU, HAWAII
Honolulu Board of REALTORS’® Monthly Statistical Report for September 2008 (released October 1, 2008). Each month, the Honolulu Board of REALTORS® issues a statistical report analyzing residential real estate activity on the island of Oahu. In addition to the general island-wide statistics, following is information for select individual neighborhoods:

Waialae/Kahala – See page 8 of Monthly Statistical Report
The statistics for this month are significantly different from last month, it is amazing! Comparing September 2007 to September 2008, the median price for a home in 2008 was down 33.3% (the same comparison for August 2007 and August 2008 showed the median price was up 37.8%). For the year-to-date statistics for January through September of 2007 versus January through September 2008, the median price for the neighborhood was up 7%.

Diamond Head – See page 8 of Monthly Statistical Report
The statistics are not specific (as provided by the Honolulu Board of REALTORS®), since the Diamond Head area (a high-end neighborhood) is mixed into the Kapahulu area (a moderately priced neighborhood). For the Kapahulu-Diamond Head area, the median price decreased by 3.3% compared to the same month in 2007. For the year-to-date (January through September of 2007 compared to 2008), the median price decreased by 3.3%.

Kailua-Waimanalo – See page 8 of Monthly Statistical Report
September 2007 compared to September 2008 had a -14.1% increase in the median price. Comparing January through September 2007 and the same period in 2008 shows a decrease of 4.9% in the median price. 



Other Specific Neighborhoods – There is no substitute for market information from people who are qualified and who know your market. The best way to view a specific neighborhood is to have your agent prepare and review a Comparative Market Analysis with you. For example, the MLS service permits us to do searches within very discrete Oahu neighborhoods, including Kahala/Black Point, Diamond Head, Ala Moana/Kaka’ako, Waikiki/Gold Coast, Hawaii Kai/Portlock, Hawaii Loa Ridge, Kailua/Lanikai and the North Shore.

It has been our experience that the neighborhoods that we concentrate on are less volatile than the market as a whole, which is down about 10%. Part of that involves the worldwide demand for spectacular luxury properties in outstanding locations.

Relative to the overall Oahu market, according to Harvey Shapiro, the Research Economist for the Honolulu Board of REALTORS®, “It appears that the Oahu housing market is reacting to the economic crisis that has been affecting financial markets worldwide.”


Editor’s Note:
Cedric Choi is the Vice President and Administrative Manager of Choi International, a member of the Luxury Real Estate Board of Regents. As a practicing attorney for more than 25 years, Mr. Choi has principally concentrated in areas involving commercial matters. Very interesting blog entry. Every one I post on the Luxury Real Estate Blog seems completely distinct in both tone and voice from every other. You can see similarities and fun little patterns when you read one person’s blog entries over a period of time, but it’s also fun to get a breadth of styles and information from a bunch of different sources, as well. Be sure to visit www.ChoiRealty.com for more resources on buying a luxury home in Hawaii.

By Robert Lockard

I recently finished writing an interesting article for the winter 2009 issue of LuxuryRealEstate.com Magazine. The article is on “green” homes, and it was a challenge to write, mainly because I have a number of concerns about the current global-warming scare. I was able to find a lot of good in “green” homes, especially their energy savings and positive health effects on residents. I shied away from discussing their environmental effects, since I am unconvinced that they will have any real ones, and saying that they will might give people a false sense of security.

To be sure, I am all for conservation and avoiding the waste or misuse of our resources. But something is very wrong with the current debate, or lack thereof, on global warming. I bring this up, not only because of my magazine article, but also because I read a very informative article entitled “Hot air over global warming” by Jerome Delvin in The Seattle Post-Intelligencer this morning. I highly recommend checking it out.

As I noted in the Editor’s Note of a July 31, 2008 post to the Luxury Real Estate Blog by Jean-Yves Piton entitled “Green luxury real estate,” many climatologists and other scientists are speaking out about the fallacy of manmade global warming. You can find a great deal of accurate information from top scientists who spoke at the 2008 International Conference on Climate Change. It is clear that the Earth’s atmosphere is warming, but there is actually little evidence to suggest that human activity is the main cause.

The data simply does not support the idea that the Earth’s temperature has increased at a steady pace along with the increase in carbon emissions during the past century or so. In fact, in the 1970s global cooling was touted as a major problem facing the world, not global warming. The fact that there was cooling going on during a period of steadily increasing carbon emissions seems to point to the fact that the relationship between manmade greenhouse gases and the temperature of the atmosphere is much more complex than we’re being told.

I believe that regular people can make a difference in the world, often by raising strong families and focusing on the most important things in life. However, it seems to me like this good idea (one person being able to have a positive effect on the world) has been twisted and used inappropriately when it comes to global warming in order to take advantage of well-intentioned people.

I often feel barraged with messages saying that I need to be more responsible and consume less in order to lessen my “carbon footprint” on the environment. I am wary of the rationale behind this argument for a number of reasons. There is little evidence that paying money to plant trees or somehow offset our emissions has a significant effect on the environment. In fact, an interesting study in Reportonbusiness.com found that our return on investment from putting money into the fight against global warming is so low that it’s really not even worth it. The fact is that, despite good intentions, one person, or even 6 billion people, can’t make much of a difference when it comes to global warming.

Returning to the “green” article I wrote, I tried to focus on “green” homes from the perspective of why a person would choose to purchase one. After all, they are more expensive to build, so there must be a promise of future rewards rather than a vague promise of being better for the environment. “Green” homes appear to be very sound investments because they cost less to maintain, contain fewer toxic materials and thus promote the financial and physical health of their inhabitants. I believe that “green” homes can be very good. But I do not think that they are good simply because they have some sort of positive effect on the environment that is, in reality, overrated and insignificant.

I have much more to say on this topic, but I’m afraid I just don’t have time to cover everything. I apologize if I have offended you. I am very passionate when I see injustice, and I wish to put an end to it. I think we need much more information before making changes that might have little or no effect on the problem we think we’re solving.


Editor’s Note:
Robert Lockard is the Public Relations & Media Specialist with Luxury Real Estate. I am Robert. I create all of Luxury Real Estate’s newsletters, write the editorials in LuxuryRealEstate.com Magazine and much more. If you disagree with me, I encourage you to look closely at the data before posting comments. I enjoy healthy discussions in search of truth, but I do not approve of name calling or unkindness. I just posted a blog entry by Simon Turner on Google Maps and “green” luxury homes. I don’t mean any disrespect to him by posting this blog entry. As I mentioned above, I think that there is a lot of good in “green” homes, but I just don’t think that they will make any difference on the environment. Update: This blog entry has been updated to remove two paragraphs.

By Aaron Wheeler
From his blog: Up, Down, Sideways – Which Way Is The San Francisco Bay Area Market Going?


As a part of being Real Estate 3.0, I talk about Wall Street financial sophistication. I love numbers and statistics, and it is important to keep them in mind when evaluating any opportunity.

I’m happy to make available the research that I use to stay on top of market conditions here in the San Francisco Bay Area and in Las Vegas too.

If you go to my research widget by clicking here and letting me know which areas you are interested in, you will receive a weekly executive summary report for almost any city in the area, from San Francisco to Pebble Beach and everything in between (Interested in Las Vegas instead? Email me with information on the areas you are interested in and I’ll send you a current report right away). Each report is loaded with vital statistics showing price trends, inventory and the unique market action index that gauges whether we are favoring a buyer’s or seller’s market. (Generally, index values above 30 favor the seller.)

If you like what you see and would like to become a client, I will upgrade you the full report, which will go into depth as to what makes each market area tick.


Editor’s Note:
Aaron Wheeler is the President and Managing Broker of Oakville Properties in the San Francisco Bay Area. You can find additional great blog entries like this at the Oakville Properties Blog. Oakville Properties is a member of Luxury Real Estate. This blog entry can also be found on the Luxury Lounge, for those of you LuxuryRealEstate.com members who have accepted the invitation to join that new networking group. Research is key to finding the right opportunities at the right time. Aaron is an awesome resource for buyers and sellers in the San Francisco and Las Vegas luxury home markets. I definitely recommend taking his advice and contacting him to gain all the knowledge you can from him.

By Michael Marquette
From his blog: View from the Bridge: Michael Marquette’s comments to the Australian Financial Review

Homeowners and investors have welcomed suggestions that the Reserve Bank of Australia will cut interest rates this year, but will the banks pass the rate cuts onto borrowers?

Prime Minister Kevin Rudd has told Australians to change banks if they fail to pass on rate reductions. The banks have had no problem increasing rates to levels higher than official rate increases and have even increased rates despite the Reserve Bank keeping them on hold.

In an interview with The Australian Financial Review last week I was asked what it would take to restore confidence in the market. I expect buyers to remain cautious until the banks show that any rate reductions will be passed on. I believe a rate cut of around 1 percent is needed to restore buyer confidence as I’m hearing increasingly that buyers and vendors are skeptical that banks will pass on the rate cuts. A reduction of 100 basis points will result in the market reacting in a positive way, even half a percent will be looked on cautiously.

So the question is buy now or wait? The answer is simple. There are some fantastic buys in the luxury market at the moment and this will continue for the foreseeable future. As the stock market wobbles, dividends decrease and share prices drop bricks and mortar will become a major focus for many investors.

If you find the right luxury property at the right price and choose the right lender, your decision is an easy one to make. My only advice is to ensure sure that you keep your lender honest, and if “changing banks,” as PM Rudd suggests, make sure you are aware of all fees and costs that may apply.


Editor’s Note:
Michael Marquette is the co-Founder and Director of Marquette Turner Luxury Homes in East Sydney, New South Wales, Australia. Founded on Australia Day 2007 by Marquette and Simon Turner, Marquette Turner is a property consultancy company covering the Australian states of New South Wales and Victoria. Marquette has a background in medicine and a large retail and wholesale business. When banks charge unfair fees for their services, they are not building good relationships of trust with potential clients. I prefer kindness and openness when working with people. Thanks for the insightful blog entry, Michael! The photo of the Australian dollar coins is from www.flickr.com/photos/astro-dudes/913087028 and it is the copyright of Claire L. Evans.

By Brian Langhorst

I have heard many times over that print is dead, but this is false information! Whoever is saying this does not know the audience for luxury homes and their habits. Yes, people look to the Internet for information and, according to a National Association of REALTORS® survey, over 80% of home seekers are starting their search online for real estate.

The main question we should think about is how do they know where to look for real estate online? The answer is print!

I had a very interesting conversation yesterday with Victor Lund, co-Founder of the WAV Group. He said that the typical consumer segment of the luxury property market still looks through newspapers, magazines, and other print media for news and information. Customers need guidance and print provides this guidance to learn more about real-estate opportunities on the Internet. With a proper call to action this high-net-worth audience will be driven to your website through your print advertising campaign.

I look forward to your replies. Let me know how we can help you create targeted print ads to drive more traffic to your website.


Editor’s Note:
Brian Langhorst is LuxuryRealEstate.com’s Membership Manager. He meets members’ unique needs through the dynamic services LuxuryRealEstate.com provides. Victor Lund was so kind and helpful when he came to the Luxury Real Estate headquarters here in Seattle. He had a lot to share about our Web site, which is the most-viewed luxury real estate site in the world, and many other topics like the one Brian just discussed. It’s always nice to meet nice geniuses and well-grounded visionaries. The photo above is from www.flickr.com/photos/joebeone/2528716096 and it is the copyright of joebeone.

By Michael Marquette

From his blog: Australian Auction Clearance Rates Crash!

Auction Clearance rates for the week ending July 27, 2008 indicate a property market in crisis. Sydney’s Clearance rate of just 36.5 percent is indicative of the disparity between vendors and buyers, with some real-estate agents caught in the middle.

Luxury real estate agents’ skills in both marketing and negotiating homes are being put to the test and many are being found short. Agents with reputations for overpricing properties (the practice of overpricing is used by some agents to win listings) are struggling to match the prices offered by buyers with the price expectations of vendors. Agents with the ability to communicate the best strategy at the time of listing are best placed to negotiate the highest price for vendors in the current market – well before a property is seen to become “stale.”

Getting the right agent is the key to successfully selling your home. Given that the total number of sales is down and the list of unsold properties is increasing, it is more important than ever to ensure that your luxury home is in safe hands. Given that spring, and the usual seasonal increase in the number of listings, is beckoning I stress the importance of making the right decisions the first time!



Editor’s Note:
Michael Marquette is the co-Founder and Director of Marquette Turner Luxury Homes in East Sydney, New South Wales, Australia. Founded on Australia Day 2007 by Marquette and Simon Turner, Marquette Turner is a property consultancy company covering the Australian states of New South Wales and Victoria. Marquette has a background in medicine and a large retail and wholesale business. Some markets are facing tough times, and it’s good to be aware of potential issues as well as opportunities. The photo of the crashing wave is from www.flickr.com/photos/victorgeere/24539591 and it is the copyright of Victor Geere.

By Brian Langhorst

LuxuryRealEstate.com is the most-viewed and most-visited luxury real estate website in the world. For this reason we opt not to capture the visitors of our website right away to search properties around the world.

We realize many of our visitors are of very high net worth and have very limited time, thus the idea of creating restrictions does not make sense. On the other hand, I see many websites who capture their visitor traffic right away.

I personally prefer not being captured right away on websites and opt to view websites where the capture of data does not occur until later.

What are your thoughts?


Editor’s Note:
Brian Langhorst is LuxuryRealEstate.com’s Membership Manager. He meets members’ unique needs through the dynamic services LuxuryRealEstate.com provides. This is an interesting topic because the Internet is all about letting customers remain anonymous until they want to identify themselves to take advantage of offers and other things online. Is it better to ask people for information sooner or later? It’s hard to tell. I smell a great discussion brewing…

By Allyson Metters

Nearly one in five REALTORS® has sold a home to an international client in the past year, according to new research by the National Association of REALTORS®.

The 2007 NAR Profile of International Home Buying Activity explores the characteristics of second-home purchases in the United States made by international clients.

Some interesting points:

• Twenty-eight percent of foreign buyers bought their houses with cash, compared to 8 percent of U.S. buyers.
• The median sales price of homes purchased by international buyers was $299,500, which is significantly higher than the U.S. median of $221,900 during the same period.
• The South attracted nearly half – 49 percent – of international buyers last year, while 31 percent purchased homes in the West.
• Nearly a third of the REALTORS® surveyed worked with international clients or prospects during the previous year.
• Among international clients, the top five countries of origin were Mexico, United Kingdom, Canada, India and China.

By Robert Lockard

Similar to yesterday’s post, I would like to focus on some issues that I hope will show that current real-estate worries shouldn’t frighten buyers, sellers and agents too much. It seems like everything is going wrong right now because that is what we have been hearing over and over in the media. However, according to the RISMedia article entitled “Give Your Clients the Real Facts,” the National Association of REALTORS® is beginning a bold campaign to stem the tide of bad publicity with ads and a new Web site: www.housingmarketfacts.com. Basically, they stress the fact that real estate, and especially luxury real estate, has always been a good investment.

I definitely like this development because it’s good to alleviate some of the fears being spread in real-estate markets around the country. Other bloggers have pointed out to me that real estate is driven by emotions as well as numbers, so simply saying that everything is okay and that the numbers show growth isn’t enough to turn the tide against negativity. But it’s a good start. I hope that people will calm down soon and start focusing on solutions to the real and perceived problems plaguing many real-estate markets. I hope I can be more positive and share some solutions instead of just focusing on problems, as well!


Editor’s Note:
Robert Lockard is the Public Relations & Media Specialist with LuxuryRealEstate.com. I am Robert. I create all of Luxury Real Estate’s newsletters, write the editorials in LuxuryRealEstate.com Magazine and much more.