Over the last few days, I have stolen a few glances at the MLS so that I could calculate this month’s Maui Real Estate Statistics. I had been tracking sales on and off throughout the month as it seemed as if there was heightened sales activity. When all was said and done, April proved to be the year’s best for sales volume for all three property categories. I will have details on all of the Maui Real Estate statistics followed by a commentary below. The numbers below are preliminary. I noted a number of additional sales reported for the 30th on Monday. There may be additional sales that as of yet have not been reported. Those should be captured in the local Realtor Association’s official statistics. In the interim, here are my unofficial statistics.
Home sales for April tallied 88 closes at a median of $477,500. This compares to April 2009 numbers of 60 homes sold at a median of $497,000. This represents a 46% increase in sales volume when comparing the two months.
Condo sales were solid at 158 unit sold at a median of $455,000. This compares to 41 units sold in April of 2009 at a median of $410,000. This represents a 385% increase in sales volume when comparing the two Aprils.
Land sales tallied 15 for April of 2010 at a median price of $540,000. This compares to 11 sales at a median of $1,100,000 for April of 2009. This represents a 36% increase in volume when comparing April of 2010 and April 2009.
Bank owned or REO properties and short sales continue to be a significant part of the overall sales volume. We saw a total of 36 REO sales and 22 short sales for the month. For home sales, 26% of the transactions were REOs or short sales. For condos, 22% of the transactions were REOs or shorts. None of the land transactions were shorts or REOs. These numbers are not too far off what we have seen in recent months. As I noted last month, the percentage of REO sales exceeds its portion of the total inventory. Buyers continue to seek REOs due to price opportunities.
April proved to be a pretty healthy month for sales volume. This was our best month since the pre-Lehman brothers crash. The condo market was particularly robust with its healthiest sales volume since late 2005. The increase in sales volume between 2010 and 2009 is pretty striking. That being said, it should be noted that the differential is due in part to the strength of the 2010 numbers and also the weakness of the 2009 numbers. There are a couple of other caveats. The 2010 condo numbers also saw the Honua Kai effect come into play again. There were 40 Honua Kai closes last month based on long term contracts and an additional 3 closes based on more recent contracts. However, if you were to strip out all of the Honua Kai closes, you would still have 115 closes. That is nothing to sneeze at and a sign of pretty healthy market activity.
Home sales numbers were the best we have seen in 2010 and the second best total in over 20 months. Entry to mid level homes are seeing the bulk of activity with 63 homes sold under $600,000 last month. That being said, we are seeing more activity in most segments of the market. One area where we saw a notable uptick was in the luxury market. During March, I wrote a blog post that speculated about potential signs of life in the Maui Luxury Market. The post was based less on quantitative sales numbers than anecdotal evidence. We are starting to see quantitative support for luxury market improvements. While there had been eleven sales over $1,500,000 in the first quarter of 2010. April alone had 9 sales in this price range. Included among the nine sales was the highest purchase price for a single family residence in Maui history. One luxury buyer had enough confidence to plunk down $19,850,000 for a 1.65 acre estate on the Beach in Makena.
An increase in luxury activity was also evident in the condo market. There were 19 condos sold over $1,500,000. Nine of those sales were long term Honua Kai closes, but it is noteworthy that the developers have been successful holding on to these high end buyers throughout these extended contracts. The luxury market still has substantial inventory to chew through over the next couple of years, but we are starting to see this inventory be absorbed at an accelerated rate.
What does this all mean? Well, it is clear that we are continuing to see signs of improvement in the volume of sales on Maui. I would anticipate that we will continue to see solid sales volume for the next couple of months. There are quite a few properties that have gone under contract in the last month or two that are still set to close. The question is will the Maui market sustain its momentum? There are a few head winds on the horizon. The home buyer tax credits are no longer available as of May 1. Will that shrink demand on the lower ends of the market? Interest rates have stayed low thus far, will they stay low for an extended period? What is happening with inventory? Will we see inventory shrink or are we seeing more properties come on the market? There is also a question of the economic recovery sustaining or building momentum These variables will be interesting to watch over the next few months and into the summer.
I haven’t talked much about pricing in this discussion. I am always cautious when looking at median prices on Maui due to sample size. For example, there was an increase in condo medians this April vs. last April. To be clear, condo prices have not increased over the last year. The median increase is more a reflection of the increased activity occurring in the high end of the market. We are continuing to see downward movement in prices in all segments. REOs, short sales and volume of inventory are going to weigh on prices. We will need to see more sustained healthy sales volume to stabilize the prices.
While this was an encouraging month for statistics, sellers need to be mindful of the previous two paragraphs. The improvements in market conditions have not translated to a seller’s market. Buyers still have the advantage and sellers need to price themselves competitively. Buyers will find that this continues to be a good time to look for properties. Low interest rates, healthy inventory and opportunities well below peak market prices make this a good time to check out the market. Feel free to contact us with questions or if you need assistance in buying and selling Maui property. Stay tuned for the official Maui Real Estate statistics sometime in the next week.