What makes Honolulu a luxury community? It is mostly due to the faulty definition of a luxury home being one that costs more than a million dollars.
In many places, $1 million is a lot of money. In Honolulu, that is the cost of a starter family home. The median price of single-family homes listed in the spring of 2021 was $920,000. A midsized family home by mainland standards costs $2 million or more. This is why Honolulu has such a hot condo market. The median home value in Honolulu when you take both condos and single-family homes into account is $750,000.
The average condo costs around $450,000. That sounds like a lot until you realize that median rent in Honolulu is over two thousand dollars a month, making condo ownership a relative bargain. The downside is that you’re competing with tourists that want to own a place to stay when they’re in the state and hope to rent it out to tourists when they’re gone.
Why is Honolulu real estate so expensive? There is limited inventory due to geography and history. The low-lying areas have been completely built up for decades. When someone tears down two or three single family homes, they build a condo tower. Nor can Honolulu’s residential real estate market relieve the pressure by building on the relatively open land around Joint Reserve Base Pearl Haror-Hickham. Furthermore, Mililani Mauka – Launani Valley is off-limits to development.
We’ve already provided an overview of the fundamentals of the Honolulu real estate market. The Honolulu luxury real estate market has its own rules. People pay a premium to be near the water. For example, the price tag doubles or triples if they say you’re in walking distance of Waikiki Beach. The average price of a luxury condo in Honolulu is roughly $2 million. The average listing price per square foot is around $1300, while $1600 per square foot is common for luxury properties. Note that because many condos are intended for out-of-town visitors, you’ll pay more per square foot for the rare three and four bedroom condos on the market. On the other hand, this has driven up the price of one- and two-bedroom condos for everyone.
You’ll be paying more for ocean views, mountain views or being in the city than anything else. Note that this is why the units in the tallest buildings often cost more than those in other condo complexes. Beyond that, the amenities offered in the luxury unit vary widely. Some units have private lanai or private passageway. It is common for units with premium views to have floor to ceiling windows. Marble and granite finishes or state of the art kitchen appliances are common, since they can’t give you more space. Pools and Jacuzzis are commonplace, though these may be in the condo building’s common areas. You may get a concierge, too. That’s especially true for high rise condo buildings managed by companies like Ritz Carlton.