O'ahu's housing market has been cooling for about six months, but buyer response to the latest Kaka'ako condominium tower to hit the market shows that demand is still hot.

A lottery held yesterday to select buyers for 192 units in the planned Moana Vista high-rise at 1009 Kapi'olani Blvd. drew 466 hopeful applicants — most of whom will be disappointed by the results of the drawing.

"The interest is still really strong," said Allen Leong, operations director for KC Rainbow Development, which is selling units in Moana Vista for prices that could range from $425,000 to $850,000.

Entertainer Kimo Kahoano, who announced names of prospective buyers as he drew entries out of a bow-adorned Xerox paper box, joked that he had a tough audience among the handful of applicants and real estate brokers who turned out to witness the drawing.

"Just remember, it's not my fault," Kahoano said. "I can't see the names."

Hawai'i Kai retiree Patricia Kim was Kahoano's 51st pick, and appeared to be the highest seed among prospective buyers attending the drawing.

"Hooray!" she exclaimed, drawing applause from about 25 guests in the project sales office. "I'm moving."

Anita and Leroy Carrington, Maui residents seeking to move to Honolulu, were less sure they'd be making the move to Moana Vista, which is scheduled to begin rising before next year and be finished in early 2009.

The Carringtons left the sales office after their names weren't among the first 200 selected.

"We're still hoping," Anita Carrington said.

"There's still a chance," her husband added.

As with most new-home lotteries, prospective buyers send in applications, and the developer holds a random drawing to arrange customers in order. The No. 1 pick gets the first choice among available units, narrowing the choice for those who follow.

Most of the state's major home developers instituted lotteries for their most popular market-priced homes about three years ago in response to overwhelming demand that oftentimes led to potential buyers' camping out for days to snag homes sold on a first-come, first-served basis.

Since late last year, demand has softened and sales of previously owned O'ahu homes have dropped by about 10 percent from a year earlier while inventory has roughly doubled.

Sales of new homes also have declined this year, falling 57 percent in the first quarter compared with the same period a year earlier. But market researcher Ricky Cassiday said the new-home sales drop-off was mostly due to developers not having as many homes available.

Some previous new-home lotteries in the past few years have had bigger turnouts, including Kaka'ako high-rise Keola La'i on South Street, which last July drew 1,100 applicants for the first 85 units. Moana Pacific, a twin-tower project at Pi'ikoi Street and Kapi'olani, drew about 1,000 applicants for about 350 units sold by lottery.

"It's been a different trend in the market," said Allen Leong of Moana Vista developer KC Rainbow, which is building the sold-out Moana Pacific.

Moana Vista, which will have 492 units, is expected to be sold out as lottery buyers select units to buy over the next two weeks.

Of the project's 492 units, the 192 lottery units are reserved for owner-occupants. Another roughly 190 units available to anyone, including investors, were reserved by buyers earlier this month on a first-come, first-served basis. About 100 units are slated to be modest-priced rentals to satisfy an affordable housing agreement with the state.

Camellia Young, a broker with Realty Executives, represented about 45 lottery applicants for Moana Vista. She said many are white-collar professionals in their 30s and 40s, with some just starting families.

Young's clients — who include a pediatrician, fishmonger, lawyer, psychologist, sushi chef and nutritionist — were mostly seeking units priced at $500,000 or less. "It's still hard to find something in town in their budget," she said. "They're not looking at something for $600,000."

Kim, the retiree who drew No. 51 in the lottery, plans to sell her four-year-old Hawai'i Kai home at The Peninsula if she can select a similarly priced Moana Vista unit. "I like high-rise living better," she said. "I have a home that has a yard, and I'm not interested in taking care of it."

Reach Andrew Gomes at agomes@honoluluadvertiser.com.