Buyers are going crazy for condos in Hawaii

HONOLULU — Paula Harris remembers driving around Honolulu in the 1970s and admiring all the cranes in the sky.

"They used to say that was the proud bird of the Pacific," she said.

Today the giant steel cranes are back and are quickly changing the city's skyline, transforming parking lots, weed-filled vacant parcels and dilapidated structures into shimmery, luxury condominium towers.

"It hasn't happened since then, so people are really enjoying the moment," said Harris, president of The Harris Co., a Honolulu-based real estate consulting firm.

At least a dozen condo projects within a three-mile stretch of Honolulu from downtown to Waikiki are under construction or in the early planning stages. When completed, the new high-rises will add roughly 4,000 new units to the market, not including the many hotels being converted into vacation "condotel" units in Waikiki.

Despite taking years to build, the new condos have created a flurry of buying, with thousands of people seeking their own piece of paradise. Most developers are now using a lottery system because of the high demand, eliminating the free-for-all and camping out that occurred when it was first-come, first-served.

And there's no blue-light special on condos.

Of the seven new condo projects tracked by The Harris Co. from April to June, the average price for the smallest units was $460,714. The average for the largest units was $2 million. The most palatial penthouse units were priced at about $4 million.

Besides the non-negotiable sticker price, buyers will also have to pay hefty maintenance fees that range from $400 to $1,200 a month.

"The units are meeting the demands of the buyers," said Harvey Shapiro, research economist for the Honolulu Board of Realtors. "In other words, they are selling. If they were overpriced, they wouldn't sell."

The buyers are putting down the required big deposits without seeing the inside of their units for several years. They often are buying based on a vacant lot, the model of the building and a sample kitchen or bedroom layout in the condo's sales office.

But that hasn't discouraged buyers.

As of early July, 1,912 of the 2,076 units in the seven projects were in escrow.