Author: Pete Jalbert
Three months into the year and interest rates continue to fluctuate. In January it seemed like rates were heading downward steadily. February saw an increase in rates. The banking crisis earlier this month caused rates to adjust downward again. Last year, there was a lot of ink spilled and key strokes dedicated to predicting rates. Most predictions proved to be wrong. At this point, prognostication on rates seems like a fool’s errand. That said, I wanted to talk about one of the better bellwethers for mortgage rates, the ten year treasury bond.

In the financial world, a bellwether is an indicator of something bigger. For the bond market, the ten-year Treasury bond is the go-to indicator of how things are going. When investors are feeling good about the economy, they tend to buy more bonds, which drives down the yield (i.e., interest rate) on the ten-year Treasury bond. Conversely, when things are looking a bit shaky, investors tend to flock to the safety of Treasury bonds, which drives up the yield.
So, what does all of this have to do with mortgage rates? Well, the yield on the ten-year Treasury bond is a key indicator of where mortgage rates are headed. When the yield on the ten-year Treasury bond goes up, so do mortgage rates. When the yield goes down, mortgage rates tend to follow suit.

Think of it like a game of follow the leader, but with money. When the leader (the ten-year Treasury bond) goes up, the followers (mortgage rates) try to keep up. And when the leader goes down, the followers slow down too.
What Does This Mean for Buyers?
Consider this as more of how does this work vs a how to post. I’ve read in some places that following the ten year treasury closely may give buyers a sense of when to lock their mortgage rate. I have to say, I am a little skeptical about that. While the two are closely correlated, there may not be enough lag between the change in treasury bond yields and the change in mortgage rates. It’s a pretty busy world out there and unless you work in finance, you also may not have the time to closely monitor treasuries. This is where I would lean on a knowledgeable mortgage professional rather than tracking things yourself. Let your mortgage professional give you guidance on when to lock your rate.
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We want to help!
The scarlet letter of Hawaii Real Estate isn’t A. It’s the letters LH. Seeing the land tenure leasehold on a listing causes many buyers, and agents for that matter, to bypass a property. Just as the puritans wrongly ostracized Hester Prynne, leasehold properties don’t deserve to be shunned. For the right buyers, leasehold ownership provides a great opportunity. This is particularly the case in an era when inventory and options remain limited.
Lower Acquisition Costs
First and foremost, it’s worth highlighting the biggest advantage of leasehold. Acquisition cost. Leasehold properties cost significantly less than comparable fee simple properties. Plain and simple, you get more bang for your buck. Higher monthly fees are the tradeoff for lower acquisition costs. In addition to the maintenance fee, leasehold properties come with a monthly lease fee. If you have less cash in reserve for your purchase, but strong monthly income, leasehold could be an interesting option.
A Few Other Things To Consider With Leasehold
There are some other factors that can enhance the appeal of a leasehold property.
- Does the property offer something unique? There are a handful of leasehold properties that offer something unique or at least less common in the Maui market. Alaeloa is a truly one of a kind development in the Napili area. The combination of low density, a beautiful shoreline and the mix of stand alone and duplexed beach cottages is unlike anything else on Maui. Maui Eldorado in Ka’anapali has its fantastic beach cabana. Kamaole Nalu is one of a handful of direct beachfront condos in South Kihei.

- Does it have a longer lease term? A longer term lease is particularly appealing. It takes away uncertainty about the future of your property and it opens financing options. If it is in excess of 35 years, it allows for a conventional 30 year mortgage. More than twenty years left on a lease means you can get a fifteen year mortgages. You need five more years on the lease than the term of the mortgage to get financing. Once a lease term shrinks to less than 20 years, both the smaller pool of buyers and increased uncertainty may impact resale value.
- Can it be converted to fee simple? In some cases, the lessor shows a willingness to convert the property to fee simple. That could enhance the condos value over the long term. The caveat here is that fee conversion costs money. In almost all cases, the financial outlay for lessees is significant. Typically, somewhere in the six figures significant.
Discover New Options
Again, leasehold isn’t for everyone and not all leasehold is the same. It requires some extra due diligence and there is a reason that leasehold properties come with their own unique disclosures. That said, there are some great leasehold properties on Maui and that list extends beyond the three developments referenced above. Don’t stigmatize a condo just because of its land tenure. Any condo on island whether its leasehold or fee simple is going to have its strengths and its weaknesses. If you evaluate the condo development on the plusses and minuses as a whole, you might just find leasehold fits your needs. We look forward to assisting you with the evaluation process.
Interested in Buying a Maui Condo?
Significant price reduction! The owners of the Oasis just reduced their asking price by $1,500,000. This means that you can now own an exceptional piece of Maui real estate at a drastically reduced price. This property is a complete reimagination of the Maui living experience. Every aspect of it has been carefully curated and thoughtfully designed.

The main home features two bedrooms with ensuite baths, a 3rd bathroom, and an expansive kitchen/great room/ dining area. The Italian designed Boffi kitchen is a work of art. Marble counters, Gaggenau appliances, and Corian cabinets are the building blocks of a space designed for the entertainer and chef in you. Baccarat chandeliers punctuate the living and dining areas. Boffi sinks, fans, and showers, Dornbracht fixtures, and Flos lighting add to the impeccable design choices. The reclaimed, oiled teak floors and book matched marble in the showers continue the theme of simple elegance throughout the home.


The outdoor spaces of The Oasis are equally stunning, with a zero-edge main pool, a 64-foot lap pool, and a 6’x12’ garden soaking tub. The covered patio adjacent to the main pool is perfect for entertaining. The multiple outdoor showers are ideal for rinsing off after a day at the beach. The lush outdoor gardens are a sight to behold, with every tree and plant feeling perfectly placed.


The detached studio apartment is a perfect guest space or home office, with finishes and fixtures equivalent to the main house. And one of the coolest “hidden” kitchens around!

Overall, The Oasis is an exceptional living experience that has been designed, crafted, and curated with incredible attention to detail. And with the recent price reduction, it’s now more accessible than ever before. Now offered for sale at $8,300,000. Furnishings and selected art pieces may be purchased separately.
Qualified Buyers with Questions?
This is our 24th installment of the Maui Market Musings. This latest edition looks at market activity and inventory levels as of the end of February. These posts tend to be long so I will keep the intro on the short side. Without further ado, here are the numbers.
February Market Activity
The tables below show new inventory, new pending listings and closed transactions during February with data from the previous five years provided for additional context.
New Inventory
2/23 | 2/22 | 2/21 | 2/20 | 2/19 | 2/18 | |
Homes | 68 | 122 | 117 | 119 | 141 | 115 |
Condos | 82 | 178 | 202 | 159 | 161 | 191 |
Like most places, inventory remains constrained on Maui. February did not provide much in the way of inventory relief. New home inventory came in 44% lower than February of 2022. It is between 41% and 52% lower than the three Februaries prior to the start of Covid. New condo inventory is 54% lower than February of 2022. It is anywhere between 48% and 57% lower than any of the three months of February between 2018 and 2020.

Pending Sales
2/23 | 2/22 | 2/21 | 2/20 | 2/19 | 2/18 | |
Homes | 57 | 94 | 133 | 85 | 90 | 83 |
Condos | 79 | 170 | 238 | 127 | 127 | 161 |
While inventory remains low, transaction volume does too. Pending home sales came in 39% lower than last year. The activity in the home market for this February is anywhere between 31% and 37% below the three Februaries between 2018-2020. For the condo market, the drop from last year is more dramatic with 54% fewer pending sales. February 2023 pending condo sales are anywhere between 38% and 51% below the three Februaries prior to Covid.
From time to time, I will hear someone rationalize that low buyer activity is just due to lower inventory. You might be able to make that argument with some segments of the vacation rental condo market. That said, affordability is clearly a significant factor in driving the lower volumes. Prices just haven’t seen significant adjustments since the spike in rates. That’s not to say that there aren’t buyers in this market, it is just a smaller pool.
Closed Transactions
2/23 | 2/22 | 2/21 | 2/20 | 2/19 | 2/18 | |
Homes | 38 | 83 | 96 | 80 | 75 | 95 |
Condos | 65 | 157 | 162 | 130 | 119 | 123 |
This February’s closed transactions reflect the low pending sales between November and January. For homes, the 38 homes sold is 54% lower than last February. That is between 49% and 60% lower than the three last pre-Covid Februaries. On the condo side, the 65 closed sales is 59% below last year and anywhere between 44% and 50% below any February between 2018 and 2020.
End of February Maui Home Inventory
The charts below show active and pending home sales by price point and community on the last day of the month over the last three months.
12/31/22 | 1/31/23 | 2/28/23 | ||||
Active | Pending | Active | Pending | Active | Pending | |
<$750,000 | 6 | 10 | 10 | 11 | 10 | 7 (-4) |
$750,000-$999,999 | 25 | 28 | 21 | 25 | 30 (+9) | 28 (+3) |
$1,000,000-$1,499,999 | 78 | 20 | 71 | 30 | 59 (-12) | 40 (+10) |
$1,500,000-$1,999,999 | 36 | 11 | 33 | 9 | 32 (-1) | 7 (-2) |
$2,000,000-$2,999,999 | 37 | 12 | 42 | 7 | 37 (-5) | 13 (+3) |
$3,000,000-$4,999,999 | 31 | 9 | 32 | 10 | 35 (+3) | 9 (-1) |
$5,000,000-$9,999,999 | 27 | 8 | 27 | 6 | 26 (-1) | 9 (+3) |
$10,000,000-$19,999,999 | 14 | 0 | 16 | 0 | 13 (-3) | 1 (+1) |
$20,000,000+ | 4 | 2 | 5 | 1 | 5 | 1 |
Total | 258 | 100 | 257 | 99 | 247 (-10) | 115 (+16) |
12/31/22 | 1/31/23 | 2/28/23 | ||||
Active | Pending | Active | Pending | Active | Pending | |
Haiku | 29 | 7 | 26 | 7 | 27 (+1) | 5 (-2) |
Hana | 10 | 1 | 9 | 1 | 11 (+2) | 1 |
Ka’anapali | 9 | 3 | 10 | 5 | 10 | 5 |
Kahului | 16 | 13 | 13 | 11 | 18 (+5) | 8 (-3) |
Kapalua | 5 | 3 | 7 | 1 | 6 (-1) | 2 (+1) |
Kihei | 39 | 7 | 32 | 17 | 29 (-3) | 24 (+7) |
Kula | 21 | 10 | 21 | 11 | 14 (-7) | 14 (+3) |
Lahaina | 18 | 11 | 19 | 9 | 16 (-3) | 8 (-1) |
Makawao | 35 | 4 | 31 | 6 | 27 (-4) | 8 (+2) |
Napili/Kahana/Hono | 13 | 3 | 13 | 1 | 12 (-1) | 2 (+1) |
Pukalani | 7 | 3 | 11 | 4 | 7 (-4) | 6 (+2) |
Sprecks/Paia | 9 | 1 | 8 | 1 | 10 (+2) | 0 (-1) |
Wailea | 13 | 6 | 16 | 3 | 14 (-2) | 7 (+4) |
Wailuku | 25 | 25 | 30 | 17 | 35 (+5) | 21 (+4) |
Three Notable Things About the End of February Maui Home Inventory
- Active home inventory dropped 4% between January 31st and February 28th. Pending sales increased 16%. The new listings in February and the new pending sales in February further up the page provide some context. The decrease in inventory is largely due to new listings coming in way below normal. An increase in pending sales is pretty normal for this time of year, but the rate of increase is well below normal.
- Market activity was something of a mixed bag by price point. The $1,000,000-$1,499,999 saw the biggest increase in pending sales. That is a little bit of a surprise with interest rates increasing again.
- Looking at the inventory at a community level, all of Upcountry saw an increase in pending listings and a decrease in active listings. Kula inventory is particularly low. Kihei also saw a notable increase in pending sales. The resorts were relatively quiet. While Wailea pending sales increased by a few, buyer activity is still below normal for this time of year.
End of February Maui Condo Inventory
The charts below provide end of the month active and pending condo inventory by price point and district. It is worth noting that the Wailea pending sales continue to receive a boost from 75 new developer units under contract in La’i Loa at Wailea Hills. These properties went pending between 2020 and the the first quarter of 2021. Priced from just under $1,500,000 all the way up to over $4,000,000, these long term contracts are also skewing the pending sales upwards in this price range. Paradise Ridge Estates is another new development in Kihei with 18 pending sales based on contracts signed between 2018 and the first quarter of 2022. Eight units in Paradise Ridge Estates closed on March 1st so the impact will be diminished in next month’s numbers.
12/31/22 | 1/31/23 | 2/28/23 | ||||
Active | Pending | Active | Pending | Active | Pending | |
<$250,000 | 2 | 2 | 1 | 2 | 2 (+1) | 2 |
$250,000-$499,999 | 12 | 16 | 14 | 11 | 16 (+2) | 14 (+3) |
$500,000-$749,999 | 38 | 25 | 49 | 31 | 41 (-8) | 42 (+11) |
$750,000-$999,999 | 42 | 27 | 39 | 42 | 29 (-10) | 45 (+3) |
$1,000,000-$1,499,999 | 32 | 21 | 29 | 32 | 33 (+4) | 30 (-2) |
$1,500,000-$1,999,999 | 26 | 29 | 30 | 35 | 33 (+3) | 35 |
$2,000,000-$2,999,999 | 18 | 36 | 17 | 40 | 18 (+1) | 41 (+1) |
$3,000,000-$4,999,999 | 10 | 18 | 11 | 17 | 12 (+1) | 17 |
$5,000,000-$9,999,999 | 14 | 0 | 12 | 2 | 13 (+1) | 0 |
$10,000,000+ | 4 | 0 | 4 | 0 | 5 (+1) | 0 |
Totals | 198 | 174 | 206 | 212 | 202 | 226 |
12/31/22 | 1/31/23 | 2/28/23 | ||||
Active | Pending | Active | Pending | Active | Pending | |
Ka’anapali | 22 | 9 | 24 | 12 | 27 (+3) | 6 (-6) |
Kahului | 4 | 3 | 3 | 4 | 3 | 4 |
Kapalua | 12 | 3 | 13 | 6 | 14 (+1) | 5 (-1) |
Kihei | 61 | 45 | 65 | 72 | 52 (-13) | 79 (+7) |
Lahaina | 11 | 12 | 12 | 9 | 14 (+2) | 9 |
Ma’alaea | 5 | 5 | 5 | 7 | 5 | 7 |
Napili/Kahana/Honokowai | 50 | 16 | 50 | 14 | 52 (+2) | 21 (+7) |
Wailea | 27 | 79 | 26 | 81 | 28 (+2) | 85 (+4) |
Wailuku | 4 | 4 | 7 | 6 | 7 | 8 (+2) |
Three Notable Things from the End of February Condo Inventory
- Active condo listings dipped 2% and pending condo listings increased almost 7% between January 31st and February 28th. Again, the story may be better explained by the numbers for new inventory and new pending sales in February further up this post. It’s expected to see pending sales increase in February. The extent to which they are increasing is well below normal.
- Looking at active and pending sales by price point, the biggest decrease in active listings and the biggest increase in pending listings occurred under $1,000,000. The higher price points were quiet with an increase in listings and only one additional pending over $1,500,000..
- At a district level, Kihei and Napili/Kahana and Honokowai saw the biggest increase in pending sales. This is not too big of a surprise considering the season. This is peak buying season for vacation rental condos. The resorts are surprisingly quiet with Ka’anapali and Kapalua seeing a drop in pending sales. Wailea’s pendings increased modestly after a quiet January.
Some Quick Thoughts
Weird conditions persist. There is still something of a balance in this market that is sustaining prices. As established above, demand is lower, but inventory remains low too. That’s what differentiates Maui from markets on the mainland seeing more significant price decreases. That said, Maui is not monolithic. There are parts of the market where properties are going under contract quickly and others where the days on market are steadily ticking upward.
Buyers searching for vacation rental condos in beach towns like Kihei can expect properties to go under contract relatively quickly. It may not be 2021 or early 2022, but when a 2 bedroom vacation rental in a good complex hits the market, it is safe to say it won’t last more than a few days. It is hard to assess the depth of that buyer pool, but inventory is so incredibly scarce that prices continue to go up in this area due largely to scarcity.
On the other end of the spectrum, the luxury condo market is quiet. Between January 1 and the end of February, only 5 condos went under contract for more than $2,500,000. This is well below 29 during the same period of 2022. It’s worth noting, activity is below pre-Covid levels but the drop off isn’t quite as steep. Slower activity in the luxury market is a national trend. The reasons extend beyond rates.
The home market is also pretty variable. The one real difference with the condo market is that there are no segments of the market that truly feel frothy. Some new listings are going under contract relatively quickly, but it a far cry from the madness of last February.
A Little Maui Beauty to Brighten This Post

Questions, Comments, Need Help Buying or Selling?
Preparing a home for sale can be a daunting task, but there are several cost-effective things you can do to improve the chances of selling your home quickly and at a higher price. Here are five of the most cost-effective things to prepare a home for sale:
- Declutter and Depersonalize: One of the easiest and most cost-effective things you can do to prepare your home for sale is to declutter and depersonalize. Clearing out excess furniture, personal items, and clutter will help potential buyers see the space and imagine themselves living in the home. Additionally, depersonalizing your space by removing family photos and other personal items can help buyers envision themselves living there.
- Clean and Organize: A clean and organized home is much more appealing to potential buyers. Cleaning your home, including windows, floors, and surfaces, will make it look more inviting and give buyers a better impression of the home’s upkeep. Organizing closets, cabinets, and storage areas can also help show off the home’s potential storage space.
- Make Minor Repairs: Taking care of minor repairs can also make a big difference in how potential buyers perceive the home. Fixing leaky faucets, replacing broken light fixtures or doorknobs, and touching up paint can all help make your home look well-maintained and move-in ready.
- Improve Curb Appeal: The first thing potential buyers see when they arrive at your home is the exterior, so improving curb appeal is essential. Mowing the lawn, trimming bushes, and planting flowers are all low-cost ways to enhance the appearance of your home’s exterior. Painting the front door, replacing house numbers, or adding outdoor lighting can also make a big impact.
- Stage Your Home: Staging your home can help potential buyers see the home’s full potential and visualize themselves living there. This can be as simple as rearranging furniture to improve flow or adding a few decorative touches to make the space feel more inviting. You can hire a professional stager or use online resources to get inspiration for staging your home on a budget.

By implementing these cost-effective strategies, you can increase the chances of selling your home quickly and for a higher price. This strategies can be effective in any market, but it is particularly important in 2023. The frenzy of the last couple of years subsided. The number of buyers are down and days on market are up. It is important to position your home for these different market conditions.
Thinking of Selling Your Property?
It was about 15 years ago give or take a year when I did my first showing at Alaeloa. The moment I stepped on the property, I knew it was special place. Charming cottages with shake roofs, a dramatic stretch of coastline and mature landscaping. I always wanted to sell a unit in this beautiful Napili development. I finally have the chance. Introducing Alaeloa #41.

Alaeloa 41 is a two bedroom, two bath unit with 1,347 square feet of living space. Originally built in 1965, its previous owners remodeled and updated it throughout the years making it well suited to modern living.

This condo features a spacious kitchen with granite counters, central island, and a Bosch oven, induction cook top and dishwasher. It has a good sized island with bar seating and plenty of cabinet space.

The kitchen opens to the living room. Large jalousie windows and a sliding glass door bring in abundant natural light. The slider opens to a covered lanai with big ocean and Molokai views.

The primary bedroom is spacious. Two large closets provide plenty of storage and room for your wardrobe. A previous owner enclosed a portion of the lanai area creating a sun drenched sitting area. Views from the sitting area include the Ocean, Molokai and even the North end of Lanai.

The bathrooms feature walk in showers with beautiful stone work, built in cabinets with even more storage and granite counters on the vanities.

The second bedroom is a good size. Wall to ceiling jalousie windows let in the trade wind breeze and offer soothing views of the tropical landscaping.
Other notable amenities include split system a/c units in the bedroom, travertine flooring throughout the home, Sapele Wood Doors and a great laundry room with plenty of storage and counter space.
With good sized rooms, a large kitchen and bedrooms, and abundant storage space, this is a condo that definitely lives like a home.

Outdoor attributes include a one car carport and outdoor storage area.

More About Alaeloa
Alaeloa is a low-density condo complex situated in the picturesque Napili area. With only 42 units on just over 13 acres, this development offers incredibly low density. Enjoy the lush landscaping with soaring coconut palms, monkey pod trees, plumeria, and there’s even a mango grove! Most of the shoreline is elevated and rugged, but there is a small bay and a crescent shaped cobble stone beach. Take a dip in the heated saltwater pool located just above the beach, or entertain guests in the clubhouse equipped with showers, bathrooms, and a kitchen area. Store your kayak or paddleboard with ease, and enjoy peace of mind with gated access and an onsite manager.
Learn Even More About Alaeloa Unit 41
Alaeloa is offered for $1,700,000. Check out the MLS page for Alaeloa 41 for more photos and details. This is a leasehold condominium with the current lease running until 2059.