In large saucepan or Dutch oven, cover potatoes with salted water. Bring water to boil and cook until potatoes are tender; drain.
In large skillet, melt butter over medium heat. Stir in water, honey, salt and pepper. Stirring occasionally, cook 1 layer of potatoes at a time, 10 to 12 minutes or until brown. Transfer to serving dish and cover with aluminum foil to keep warm. Serve warm.