In Hawaii Real Estate Is Cash Really King?

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BY DAVID BUCK – Haven’t you heard the term before that says, “cash is King?”

Cash Home


I’ve often bought into that theory and do have to agree there’s nothing like doing a cash transaction with a quick closing. We all know that financing these days is not what it used to be. Banks are more stringent on their underwriting. It’s also hard to get comps in slower markets.

I had an interesting discussion with our Kauai Broker in Charge, Anthea Adair, a few months ago. She was asking what percentage of transactions on Oahu are cash. I knew that certain products such as vacant land, construction loans, and condotels were a borrower’s worst nightmare as banks don’t want to touch them with a 10 foot pole. I wasn’t sure off the top of my head, however, had to do a little digging.

As we wrapped up 2010, here are the latest numbers of cash sales on Oahu:

  • 12% (369 out of 3,050) of single family home sales sold for cash
  • 33% (1,293 out of 3,936) of condo sales sold for cash
  • 70% (71 out of 102) of vacant land sales sold for cash

What does this say? It confirms my belief in that vacant land is still hard to finance, however, when I ran this search a few months back, the number came out at 78% of land sales were cash. Buyers are either starting to get loans, or sellers are considering seller financing.

These numbers are also telling me that 88% of home buyers on Oahu are still obtaining some sort of financing for their purchases. It will be interesting to see if the banks ease up in 2011, or will cash remain “King?”

David Buck, R-BIC, was born and raised in Hawaii, growing up on both Oahu and Maui. He is a 2nd generation real estate professional and 3rd gereration businessman in Hawaii. He graduated from Punahou School and went on to earn his degree in Environmental Analysis and Design from the University of California at Irvine. His hard work didn’t stop there. He went on to become a Honolulu Firefighter. After 7 years of two careers “putting out fires” figuratively and literally, David made the decision in 2007 to sell real estate full time. However, he still carries on the Honolulu Fire Department’s motto of Pride, Service and Dedication to servicing his clients’ needs. See more at