3rd Quarter 2008

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   The dollar value of private building authorizations and government contracts awarded both decreased in the second quarter of 2008 compared with the same quarter last year.  Increases in additions & alterations permits were offset by decreases in new residential building permits and new commercial and industrial permits.  State Government Capital Improvement Project (CIP) expenditures, however, increased significantly in the quarter. In addition, construction jobs continued to grow, although the pace of growth has slowed from the previous two years.  At the same time, the median sale price for single family homes in Honolulu decreased while median prices for condominium resales increased slightly.  The number of units sold continued to decrease significantly.

   Construction continued to be one of the major contributors to ongoing job growth in Hawaii.  In the second quarter of 2008, the Natural Resources, Mining and Construction sector added 650 jobs, an increase of 1.7 percent compared with the same quarter last year, on top of a 4.8 percent growth in the first quarter of 2008 (Table 1 and Table A-7).  The pace of growth is consistent with the slower growth starting in the third quarter of 2007.  Nonetheless, at 39,350 jobs for the quarter, construction jobs were still close to the highest level of 39,950 (in 2007Q4) since the series began in 1990.
     
   In the second quarter of 2008, total value of private building authorizations decreased $37.1 million or 3.4 percent compared with the second quarter of 2007 (Tables E-1 and E-8).  In the second quarter, the value of new residential permits was down $151.4 million or 22.6 percent; the value of new commercial and the industrial permits was down $68.0 million or 30.5 percent; while the value of additions and alternations permits was up $182.3 million or 93.8 percent, compared to the same quarter last year.  In the first half of 2008, total private building authorizations decreased $33.1 million or 1.8 percent compared with the same period of 2007.
     At the county level, in the second quarter of 2008, the value of total private building permits in Kauai County and Maui County increased $50.6 million or 123.0 percent and $43.3 million or 21.9 percent, respectively, from the same quarter of 2007.  However, values of Honolulu and Hawaii County private authorizations decreased $11.6 million or 2.2 percent and $119.4 million or 39.0 percent, respectively (Table E-8).
  
   Government contracts awarded decreased $184.9 million or 58.2 percent in the second quarter of 2008 compared to the same quarter of 2007.  In the first half of 2008, government contracts awarded decreased $168.8 million or 33.9 percent compared with the same period of 2007 (Table E-1). State Government Capital Improvement Project (CIP) expenditures were up $133.0 million or 50.3 percent in the second quarter of 2008 from the same quarter in 2007 (Table E-2).

   The single-family unit authorizations declined 30.4 percent in the second quarter of 2008 on top of a 24.5 percent decrease in the previous quarter and a 16.7 percent decline in 2007 from 2006 (Table E-4).  The value of multi-family units authorized was down 16.6 percent for the second quarter of 2008 following a 92.7 percent decrease in the previous quarter and a 66.9 percent increase in the year of 2007 (Table E-5).

   The Honolulu Construction Cost Index for Single Family Residences rose 5.5 percent in the second quarter of 2008 over that of 2007 (Table E-6), while the comparable index for High-Rise Buildings rose 6.0 percent (Table E-7). 
  
   In the second quarter of 2008, Honolulu’s median price for single family resales was $636,000, down by 4.4 percent (Table E-9), while the median price for condominium resales increased 0.6 percent to $330,000 compared to the same quarter in 2007 (Table E-10).  In the second quarter of 2008, the numbers of single-family unit and condominium unit resales were down 28.6 percent and 30.7 percent, respectively, from the second  quarter of 2007 (Tables E-11 and E-12).
  

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