"If these beautiful condos are selling in the $600,000 range you can imagine what they will be selling for in years to come when the economy should be doing better."
That may or may not be the case, but there's no reason such prices will hold for the next year or so. Units in Keola Lai, Moana Pacific, and 909 etc. are available for well below $600k, and there will be more. The next barrier is $500k, which is more than many sold for in 2006/07 anyway! Key to the current elevated prices is that many were bought by speculators (investors) between 2005 and 2008, but as the market turned a year ago they couldn't be flipped. The owners, many of whom are realtors, are staring at negative equity unless they can sell to people who will believe that now, as always, is a great time to buy!
When you have results of your property search in oahure.com, for example, check out the disclosures; 30% of 60 units in my search results are owned by realtors! And they're the ones not dropping the prices through months and even a full year on the market. These expire and may re-list later. These folks own a large shadow inventory, and they're helping to keep prices up. Check the expired listings, too. All the newer Kakaako buildings are loaded with realtor owned units (909, Moana Pacific, Keola Lai, Koolani, etc.).
Foreign money and US investors can find much better deals elsewhere, and few, if any of them believe the Honolulu market has bottomed. These condos may or may not be beautiful, but that doesn't mean they're worth the asking prices! Case in point is Hawaiki Tower. C'mon, compare the 2br 1000 sq. ft. units to 909, Keola Lai, etc., and you'll see what I mean. Ten years old, lousy floor plans, aging fixtures and kitchens... no way are they worth well over $600k when much better appointed and newer units are $100k less in 909, Keola Lai, etc.
You can 'imagine' them selling for more in years to come, if you must insist on overpaying now. Or you can wait for prices to come down while still imagining a market recovery :-)