REAL ESTATE DATA BANK.

Glenn Iniba, Market Analyst, Prudential Locations

The Hawaii Business Real Estate Composite Index was up sharply in February compared to both previous month and previous year levels. The index was again led by the Oahu average single-family and condominium resale price, which was up

24.9 percent while the Oahu average single family rent increased 14.9 percent. The Oahu total single-family and condominium resales component also posted a slight gain of 6 percent compared to levels a year ago. Another positive sign, although somewhat volatile, was the large jump in new residential building permits.

The Hawaii Business Real Estate Speculation Index showed an increase in February. Compared to a year ago, statewide condominium resales were up 12.8 percent.

The index was led by strong resort condominium sales activity on all islands. The year-over-year sales gains were led by Kona and Poipu (both up 140 percent), Waikiki (up 11.1 percent), and Kihei (up 8.5 percent). As was discussed in the past, the biggest obstacle facing resort market sales activity is the lack of available inventory.

In February, mortgage rates continued to decline compared to month and year ago levels. It is expected that mortgage rates will ease downward in the months ahead due to the Federal Reserve's decision to cut interest rates earlier this year. This greatly enhances the affordability factor for the typical buyer.

                       [THE SHAPE OF THE MARKET]
                   HAWAII BUSINESS REAL ESTATE INDEX
                                LATEST   PREIVOUS  YEAR      % CHG
                                MONTH    MONTH     PREVIOUS
INDEX (1972-100)                239.7    228.0     208.4     +15.0%
RESALES NUMBER                  479      635       452       +6.0%
AVG RESALES PRICE               349,171  $262,689  $279,628  +24.9%
AVG TIME ON MARKET/DAYS         132      107       94        +40.9%
NEW RESIDENTIAL PERMITS/NUMBER  185      108       75        +146.7%
AVG SINCE FAMILY RENTS/$MONTH   $1,580   $1,673    $1,375    +14.9%
                   HAWAII BUSINESS SPECULATION INDEX
                            LATEST  PREVIOUS  YEAR      % CHG
                            MONTH   MONTH     PREVIOUS
INDEX (1972-100)            131.4   121.4     126.7     +3.7%
WAIKIKI CONDO RESALES       60      61        54        +11.1%
KIHE CONDO RESALES          51      69        47        +8.5%
KAANARAL CONDO RESALES      14      14        27        -48.1%
KONA CONDO RESALES          36      28        15        +140.0%
 CONDO RESALES            12      8         5         +140.0%
TOTAL HAWAII CONDO RESALES  486     547       431       +12.8%
                            SALES INDICATORS
                         LATEST  PREVIOUS  YEAR      % CHG
                         MONTH   MONTH     PREVIOUS
OAHU SP & CONDO RESALES  496     635       452       +3.8%
MADISE & CONDO RESALES   205     199       180       +13.9%
BIG ISLE S.F. CONDO
RESALES               152     159       159       -4.4%
KAUAI S.F. CONDO RESALES  54      57        56       -3.6%

[Graph Omitted]