Time continues to fly as we rapidly approach the end of August. The end of the month is less than a week away and it won’t be long before I post my unofficial August Maui Real Estate statistics. That being said, I thought it might be worth writing a quick post with a few market observations.
We are seeing a little bit of a surge in activity as we approach the end of August. This is reflected in the number of properties under contract. Our pending properties sank at the end of July after a significant number of closes and has begun to surge upwards again over the last couple of weeks. I imagine we are seeing a couple of factors at play in the increase in activity. The limited window for the first time home buyers credit is starting to close. We also appear to be seeing a little more activity in the vacation rental condo market. This was a market that had been really slow for the better part of the year. However, we started to see an uptick in vacation rental sales during the July statistics. This makes some sense as we look at the overall economic picture. As confidence in the economy builds, you would think that buyers might feel more comfortable purchasing a second home.
While it is good to see the surge in activity, I don’t expect it to be long lasting. I can’t forecast the future of the market, but we are getting to a time of year when market activity begins to wane. Fall is our slowest season for visitors and real estate. I would imagine we will see another dip in activity starting in mid to late September. Typically, market volume does not pick up again until December when tourist activity begins to increase again.
Last but not least, condo stats for Maui are going to really be skewed for August and the year for that matter. I had already posted about the Honua Kai effect on the Maui Real Estate blog. Since I had posted that article, the number of Honua Kai closes continues to surge. There have now been 149 new development sales at Honua Kai this year. That is an impressive 29% of the condo sales for the year to date. These sales are based on contracts penned back in 2005. When Honua Kai first began to report back sales, I welcomed the new numbers as it enabled better comparisons with the previous couple of years. The years 2006-2008 also saw a healthy bump in sales numbers based on long term new development contracts. That being said, the 2009 new development sales are outpacing previous years. This is going to make year to year comparisons a little more challenging.
Updated on August 26th
The national new home sales numbers for July were posted for today. Sales exceeded economists expectations. I thought it was worth posting this article from CNN because it did a good job of capturing some of the underlying market psychology that may be fueling some of the improvements in the market nationally and locally.