It has been a busy start to February for the Jalbert brothers. We have both been consumed with showings from both off island and on island buyers. That being said, I have been able to steal a few moments to take a look at the MLS and try to get sense of the January 2010 Maui Real Estate statistics. Here are the numbers that I found for the first month of the new decade.
There were 46 homes sold in January of 2010 at a median price of $469,000. This compares to January 2009 numbers of a 31 homes sold at a median of $558,000. The difference in sales volume amounts to a 48% increase in volume.
Condo sales volume for January was 74 units sold at median of $407,000. This compares to January 2009 numbers of 108 sold at a median of $805,000. This represents a 32% decrease in sales volume when comparing the two Januaries.
Land Sales for last month totaled 11 sold at a median of $583,000. This is a nice improvement from the numbers from January of 2009 which came in with 3 sales at a median of $70,000. This is a 367% increase in volume when comparing the two years.
Bank owned or REO listings and short sales continue to constitute significant portion of transaction volume. We saw a total of 17 bank owned properties close last month and 7 short sales. Of all of the home sales, 24% were bank owned or short sales. REOS and short sales were 16% of the condo transactions. There was one bank owned sale among the land transactions.
The numbers above are interesting and are screaming for a little context. Home sales look strong and condos look weaker based on the year to year comparisons. The reality is actually close to the opposite of what is conveyed by the numbers.
The condo numbers for 2009 were grossly inflated in both median price and volume by something that I have called the Honua Kai effect. There were 65 Honua Kai closes in January of 2009 that stemmed from long term developer contracts dating back all the way to 2005. That compares to only 5 long term contract Honua Kai closes this year. When you strip out the Honua Kai sales, condo resales were significantly higher in 2010. Overall, the January 2010 numbers are in line with recent months. The condo market appears to be slowly regaining traction with activity happening in all segments of the market.
Home sales did show nice improvement went compared to last year. That being said, last January represented the absolute bottom for volume of new home sales. When you broaden your comparison, the January home sales figures were pretty weak. They were the third lowest monthly sales number in the last five years. Last month’s sales were down almost 50% from December’s sales numbers. What caused the big dip? Well, I can’t provide a definitive answer, but I think we may be able to get some clues from the auto market. When the cash for clunkers program was announced, there was a surge in auto sales that caused a much needed boost to the auto industry. That being said, during the months following the program, sales numbers dipped significantly. Buyers accelerated their purchase plans to take advantage of the opportunity of the Cash for Clunkers program. There were fewer potential buyers after the program expired. I think we may be seeing a similar phenomenon with home sales numbers due to the first time home buyer’s tax credit. While the credit was extended through April, there was a rush to get homes closed by the original deadline of November 30th. Some of those closes spilled into December when the extension was announced. The first time home buyer credit likely helped to increase sales volume in the fall while it may decrease sales volume for a month or two. It will be interesting to see how the next couple of months pan out to see if my theory has any credence.
The land market looks good in year to year comparisons, but it remains at a similar pace to what we have seen in recent months. This market is going to remain slow in terms of volume as loans remain scarce and prices adjust. The one thing to note about the land sales for January was that there was a small bump due to a land auction in West Maui. One developer sold five good sized parcels at the base of the West Maui Mountains in an auction. Prices for the five lots were well below recent comparable sales.
Overall, my message to buyers and sellers remains the same. Sellers need to continue to remember that this is a buyer’s market. The sellers that are having the best luck selling their properties are priced at or below comparable sales. Sellers who are fishing for peak market pricing aren’t getting any bites. Buyers are continuing to see opportunities at prices well below peak market. The best opportunities are attracting lots of buyers so it pays to have your financing squared away and get pre-approved for you loan before you start looking at properties. That allows you to be ready to strike when the right opportunity comes along. Contact us for assistance if you are in the market to buy or sell Maui Real Estate. Stay tuned for the official January Maui Real Estate statistics some time in the next week.