Who Bought What?
If you’re a first-time homebuyer in Hawaii, it’s important to keep up with the latest trends and insights to make informed decisions. The 2022 report by the National Association of REALTORS® sheds light on the current state of the real estate market in Hawaii.
According to the report, first-time buyers accounted for 26% of all home buyers, a decrease from 34% last year. Baby Boomers, both Younger and Older Boomers, made up the largest generation of home buyers at 39%. Gen Xers had the highest household incomes of any generation at $114,300 in 2022, followed by Older Millennials with a median household income of $102,900.
In terms of home types, detached single-family homes continued to be the most common home type for recent buyers at 79%, followed by mobile or manufactured houses at 8%. Additionally, 14% of home buyers purchased a multi-generational home to take care of and spend time with aging parents because children over the age of 18 were moving back and for cost savings.
When it comes to the home search process, 47% of recent buyers looked online at properties for sale, while 18% of buyers first contacted a real estate agent. 86% of recent buyers found their real estate agent to be a very or somewhat useful information source, and nearly all buyers used online tools in the search process at 96%.
Financing
Regarding financing, 78% of recent buyers financed their home purchase, down from 87% in the 2021 report. The typical down payment for first-time buyers was 6%, while the typical down payment for repeat buyers was 17%. For first-time home buyers, 26% said saving for a down payment was the most difficult step in the process.
In February 2023, existing-home sales in Hawaii reversed a 12-month slide and registered the largest monthly percentage increase since July 2020. However, sales retreated 22.6% compared to one year ago. All-cash sales accounted for 28% of transactions, and first-time buyers were responsible for 27% of sales in February.
The increase in existing-home sales in Hawaii and the high percentage of all-cash sales suggest that investment buyers may be taking advantage of the current real estate market conditions on the Big Island. Additionally, the fact that first-time buyers accounted for 27% of sales in February indicates that some people may be taking advantage of lower prices to enter the market for the first time.
However, the fact that sales were down 22.6% compared to one year ago suggests that the real estate market on the Big Island may still be facing challenges. It is possible that the decrease in sales compared to the previous year is due to the ongoing effects of the pandemic or to changes in the real estate market more broadly.
Overall, it is difficult to say with certainty what the February 2023 sales data means for investment buyers and first-time buyers on the Big Island. However, it is clear that the market is still in flux and that buyers and investors should carefully consider market conditions and trends before making any decisions.
Here in Hawaii
The information provided indicates that the real estate market has seen a decline in first-time home buyers, which may suggest that there are more people opting for renting or investing in second homes rather than purchasing a primary residence. Additionally, the report shows that individual investors or second-home buyers accounted for 18% of homes sold in February 2023, up from 16% in January 2023 but down from 19% in February 2022.
This trend could have implications for a destination area like the Big Island of Hawaii, where there is a high demand for short-term rentals and second homes. As more people look to invest in second homes or vacation rentals, the demand for properties on the Big Island may continue to increase, potentially driving up prices.
The removal of COVID-19 restrictions on the Big Island of Hawaii may have an impact on its real estate market, particularly for second home buyers and short-term rentals. With fewer restrictions on travel and tourism, it is possible that demand for short-term rentals could increase, leading to more investment in vacation properties.
However, it is also important to consider the impact of the pandemic on the economy and the real estate market in general. Many people have experienced financial difficulties due to job losses or reduced income, and this could impact their ability to purchase vacation homes or invest in short-term rental properties. Additionally, there may be a shift in priorities for buyers as a result of the pandemic, with more emphasis on stability and security in their primary residence, rather than investing in vacation homes.
It will be interesting to monitor how the removal of COVID-19 restrictions affects the real estate market on the Big Island of Hawaii over the coming months. As with any investment decision, it is important for buyers to carefully consider their financial situation and their goals before making any decisions.
About the Author
James T. Morrison, R(S)
James T. Morrison is a Realtor with Knutson & Associates, and part of the Papakea Collection Sales Team. You can email him directly at JTM@Jamesmorrisonhawaii.com or call or text him directly at (808) 339-8249
Licesnse #79190 Realtor
papakeacollection
March 10, 2026
