Maui Real Estate Blog

What Does the end of Forbearance Mean for Borrowers and Maui The Real Estate Market?

The initial economic impacts of Covid-19 included lost jobs and disruption of income for large numbers of people around the globe. With the local Maui economy largely dependent upon tourism, our small island was among the nation’s hardest hit. The original CARES act that passed in the spring of 2020 offered relief to homeowners who struggled to pay their mortgages due to job loss or depressed wages. Those struggling homeowners were able to work with their lender to pause or reduce their mortgage payments for a period time. What started as a 6 month program was extended to 18 months. A total of over 7.25 million borrowers used forbearance as a means of relief for at least some period of time. That number of homeowners in forbearance is down to approximately 2,000,000 by around the end of June.

As of September, some of the borrowers who were among the first to enter the forbearance program will come to the end of their 18 month forbearance period. At this time, it does not appear as if there will be additional extensions of the program. What does the end of forbearance mean for those borrowers and the market as a whole?

The good news is that Fannie, Freddie and FHA are saying the right things about borrowers coming to the end of their forbearance. Recent guidelines released by those entities are focused on loan modifications for borrowers struggling to make their payments due to Covid related financial struggles. If you are a homeowner faced with the end of forbearance in the immediate future, remain proactive in your discussions with your mortgage holder. Ask about loan modification programs.

For those that may not be able to get a loan modification or the terms of a modification are too onerous, selling may be the only option. During the mortgage meltdown of the 2000s, borrowers struggled with the dual challenge of economic hardship and plunging prices. The result was a wave of foreclosures. Current market conditions couldn’t be more different as prices on island and for much of the continent climbed steadily over the last twelve months. The good news is that the recent appreciation should allow the majority of borrowers who need to sell to pay off the balance of their loan. That should significantly curtail the number of foreclosures. Feel free to Contact The Maui Real Estate Team if you are trying to get a sense of the current market value of your property. We would be more than willing to help out with a free broker’s price opinion.

Based on the above, it seems unlikely that the end of forbearance will significantly change the Maui market. The impact of the end of forbearance in the Canadian market seems to reinforce that notion. About 17% of the mortgages in Canada went into forbearance. As of February, 98% of the forbearance programs expired. As of the end of June, the average home price in Canada was up 25.9% year over year.

While the end of forbearance might lead to a small bump in inventory, a drastic influx of distressed property seems less likely. Real Estate economists are predicting a gradual increase in inventories as the year progresses. Post forbearance properties should be one component of that increase.

Pete Jalbert

Maui Real Estate Blog

Maui County Property Tax Rates for the 2021/2022 Fiscal Year

July 1 marks the start of the new fiscal year and that means updated property tax rates for Maui County. While there are quite a few rates that stayed the same this year, there were also a few notable changes.

Here are a couple of things to note about our tax rates before detailing the changes by property classification. Tax rates are impacted by the use and zoning of the property. The county has a tiered tax system based on the value of the property. Tier 1 is for properties assessed at a price of upto $800,000. Tier 2 is for properties assessed between $800,001 to $1,500,000. Tier 3 is for properties assessed for more than $1,500,000.

All tax rates below are per $1,000 of assessed value. Here are the tax rates for 21/22 with notes on any change in rate from the last fiscal year.

  • Owner occupied Tier 1 $2.41 (down .10), Tier 2 $2.51 (down .10), Tier 3 $2.71 (up .10)
  • Non-owner Occupied Tier 1 $5.45, Tier 2 $6.05, Tier 3 $8.00 (up $1.10)
  • Apartment $5.55
  • Short Term Rental Tier 1 $11.11 (up .03), Tier 2 $11.15 (up .07), Tier 3 $11.20 (up .12)
  • Hotel & Resort $11.75 (up $1.05)
  • Agricultural $5.94
  • Conservation $6.43
  • Timeshare $14.60 (up .20)
  • Commercial $6.29
  • Industrial $7.20
  • Commercialized Residential $4.40

Property taxes are paid biannually in Maui county with payments due on August 20th and February 20th. Check out the Maui County Property Tax Frequently Asked Questions pages if you have additional questions on assessments and classifications.

Pete Jalbert

Maui Real Estate Blog

Support Maui Farmers

Maui Farmers need support now more than ever. With many island restaurants closed and others limited to take out only, a key market for local farmers dried up. The best way to support local farmers at this time is by purchasing CSA (Community Supported Agriculture) boxes.

One of my personal silver linings coming out of Covid-19 is my family’s purchase of CSA boxes. I always wanted to eat more locally. I knew CSAs were a great way to do it. For one reason or another, we just never subscribed. It took Covid-19 to change things. We are now eating really fresh produce every day.

I put together a list of local farmers and agribusinesses that offer box pick ups or delivery services below. Some farms are seeing pretty strong demand and only have wait lists. I included links to the Instagram profiles of a number of farms. That seems to be one of the best ways to find pick up information and availability.

Maui CSA Boxes

  • Kumu Farms. My family ordered Kumu Farms Boxes over the last few weeks. We typically receive a variety of greens and vegetables, fruit, locally grown coffee and a choice of ground local venison or beef. The box we purchase costs $50. They have fruit boxes starting at $30 and general fruit and vegetable boxes starting at $40. Kumu Farms Instagram Page
  • Okoa Farms. Okoa Farms is well known to those who attend the island’s Upcountry or Central Maui farmer’s markets. Their boxes can be customized. They have a minimum charge of $50 for delivery or $20 for a box at one of their pick up locations. Okoa Farms Instagram Page.
  • Kahomoku Farms This farm also happens to be run by Grammy Award Winning Hawaiian Musician. Boxes of fruits and veggies start at $25. George Kahomoku on Instagram.
  • Island Fresh Delivery This CSA offers all vegetable options, fruit and vegetable options and Juices. You can also include add-ons that range from CDB to Macadamia Nuts. Boxes start at $30. Island Fresh Delivery Instagram
  • Pono Grown Farms Located up in beautiful Olinda. They provide a variety of vegetables and fruit in their boxes. Boxes for pick up start at $25. Pono Grown Farm Instagram
  • Keokea Fields Fresh greens and veggies. $30 for a box.
  • Kupa’a Farms A Kula farm offering local vegetables and fruit. Their CSA is currently full and are taking people on a wait list. Kupaa Farms Instagram
  • O’o Farm Fresh greens, herbs, vegetables and fruits. Available for pick up in Kula and Lahaina. Boxes are $40
  • Maui Grown Organics Organic fruit, vegetables and herbs. Boxes range from $40-$333.
  • Lapa’au Farms Another Olinda based farm offering vegetables and fruit. This farm is unique in that they are also offering Oyster Mushrooms that they grow at the farm. This CSA is full and taking people on their wait list. Lapa’au Farm Instagram
  • Moku Roots This West Maui vegan/ zero waste eatery is offering produce boxes including local fruits and vegetables for $35.
  • Ono Organic Farms This East Maui farm offers fruits and vegetables. They have farm box pick up at Queen Ka’ahumanu Center. They also run a farm stand out in Hana. Ono Organic Farms Instagram
  • Coconut Information This Haiku farm/cooking school is offering weekly CSAs with Coconut Milk, Coconut Oil, Coconut Water and miscellaneous produce. Boxes are $75. Coconut Information Instagram
  • Volcano Medicine CSA This Kula CSA has a few spots left. They are asking for a ten week commitment for $350. Produce boxes will include local fruit and vegetables.
  • Graze and Sprout Farm Sunflower shoots, microgreens, pastured eggs and sourdough bread. $25 for a box. Pickups in Kihei and Makawao.

Farmer’s Markets

There are still Farmer’s Markets happening on the island. Here is a list and scheduled times. These are great places to support not just farmers but some of the islands other food businesses. Markets are using a variety of means to try to ensure a safe experience for shoppers and vendors.

  • Wednesday Farmer’s Market at Waipuna Chapel, Kula 8:00 AM-1:00 PM
  • The Upcountry Farmer’s Market is one of if not the largest farmer’s markets on island. The last few weeks, they were doing a drive through farmer’s market. It sounds like they are going to be trying a different set up this week that allows pedestrian traffic. All attendees will be required to wear masks. The market runs from 7:00 AM to 11:00 AM behind Long’s Drugs at the Kulamalu Town Center.
  • The Saturday Market at Oskie Rice Arena in Olinda. The market runs from 12:00 PM-4:00 PM.
  • Queen Ka’ahumanu Shopping Center Farmer’s Market. Tuesday, Wednesday and Friday from 8:00 AM to 4:00 PM.
  • Lipoa Street Farmer’s Market Check their Facebook page for items that can be pre-ordered for Saturday Pick up.
  • Napili Farmer’s Market Wednesday and Saturday’s 8:00 AM-12:00PM.

This is a list of Farmers Market that I am aware of that are still operating during stay at home and social distancing restrictions. Send us a message if you are aware of other Farmer’s Markets on island continuing to operate.

Maui Fish and Meat

Other Local Agricultural Products Available

These are some of the other Maui made products available at this time for pick-up or delivery.

  • Stacey’s Garden Delivers offers delivery of their own products as well as products from Pono Pies, Maiden Hawaiian Naturals, Maui Tonics, Maui Wild Cultures, Maui Raw, Firmiana’s Cultured Vegetables, Maka’alae Kombucha and Farm Fresh Eggs. We ordered products from Stacey’s, Pono Pies, and Maui Wild Cultures and they were all delicious. The breadfuit and chorizo tamales from Pono Pies are not on the menu, but worth inquiring about.
  • Haleakala Creamery allows you to pick up goat cheese, goat yogurt and goat ice cream right from the gate of the farm.
  • Maui Tonics offers delivery of a variety of tonics using local tumeric and ginger.
  • Broth Box from Alive and Well A variety of broths and cold pressed juices. The box may be customized with produce, meats and more. Available for pick up and delivery.
  • Haleakala Supah Shots Locally made elixirs including a spicy mix of chili pepper water and juices.

Other Resources

I found a lot of these farms and vendors on the Eat Local Maui Facebook Page. There are smaller farms that pop up on this page here and there that don’t seem to have any webpage or social media presence. It is worth keeping an eye on this page for more local produce options, farmer’s market information, food truck information and more.

The list above is not 100% comprehensive. While I spent a fair amount of time putting it together, I am sure there are others that I overlooked. Contact the Maui Real Estate Team if you are a local farmer or business that would like to be added to this list.

I know Covid-19 is bringing a lot of attention to local farms. Let’s hope that local interest and support persists when this pandemic passes.

Pete Jalbert

Maui Real Estate Blog

A Quick Follow Up to Our Mortgage Relief Post

This is just a quick follow up on the mortgage relief post I wrote on April 4th. Yesterday, I read an NPR article about issues with mortgage relief . It featured a couple from Maui. Like many island residents, the couple is experiencing a massive loss of income due to the impact on COVID-19. They are one of the many homeowners pursuing mortgage relief that are finding the terms offered by their lenders to be onerous.

In the case of the Maui couple, their loan is through Freedom Mortgage. While the lender offered to defer their loan payments for three months, Freedom Mortgage required a balloon payment at the end of that period. Even under the most optimistic scenarios, it seems unlikely that the borrowers would be able to come up with that balloon payment.

The Consumer Finance Protection Bureau website indicates that federally backed mortgages should be able request forbearance for up to six months. The CARES Act creates mechanisms to move deferred payments to to the end of the mortgage. Freedom Mortgage originally claimed that the balloon payment was the only option they could offer for deferred payments. They claimed they could not defer the amount of the forbearance to the end of the loan. NPR brought this to the attention of federal regulators. On a subsequent follow up, Freedom Mortgage changed its tune with NPR. The Maui Couple is still trying to get clarification on their options.

Takeways

To be clear, not all borrowers are running into the roadblocks encountered by this Maui couple. A number of lenders are making adjustments that allow for six month deferments with deferred payments at the end of the mortgage. That said, borrowers should expect prolonged long wait times and filing an application to get the forbearance. Forbearance terms can also vary depending on your loan program.

The biggest takeaway is that borrowers should be cautious if they are seeking mortgage relief. Make sure you read the terms of any relief offer closely. Reach out to a housing councilor (800) 569-4287 if the terms offered by your lender are confusing or not financially feasible.

Pete Jalbert

Maui Real Estate Blog

Potential Mortgage Relief

Maui depends on tourism for a significant part of its economy. Covid-19 and the ensuing shut down means a big loss of income for a number of Maui homeowners. If you are a Maui resident unable to pay your mortgage, there may be some mortgage relief options for you based on the CARES act.

Eligibility

To be eligible, your mortgage needs to be federally owned or backed by a federal agency. Relevant federal agencies include:

  • HUD
  • USDA
  • FHA
  • VA
  • Fannie Mae
  • Freddie Mac

It’s pretty clear when your loan is HUD, USDA, FHA or VA. Fannie and Freddie back over 50% of the nation’s mortgages, but not all homeowners know or remember who backs their loan. You can check to see if your loan is backed by Fannie or if it is backed by Freddie.

Forbearance

If you are unable to pay your mortgage due to financial difficulties related to Covid-19, you can contact your mortgage servicer to request forbearance for 180 days. Forbearance allows you to pause or reduce your mortgage for that 180 day period. To be clear, this does not reduce the principal on your loan. You would still need to pay off the missed payments or the difference on the reduced payment in the future. You may apply for an additional 180 day forbearance if your financial situation does not improve by the end of the first 180 days. Your forebearance options may depend in part on your loan program. If you are concerned by impacts on your credit score, servicers must not report to the credit agencies a Borrower who is on an active forbearance, repayment, or trial period plan due to COVID-19 related hardship.

Foreclosure

If you are facing foreclosure due to existing loan challenges, your loan servicer or lender may not foreclose on you for 60 days after March 18th. The CARES Act forbids beginning either judicial or non-judicial foreclosure proceedings. The Act also prohibits finalizing a foreclosure judgement or sale during this period.

Still Confused or Need Help?

The Consumer Finance Protection Board offers a guide to Coronavirus mortgage relief options that gives advice and provides a lot more detail. They provide important suggestions like questions to ask your mortgage servicer. You may also find your nearest housing councilor by calling by calling (800) 569-4287. If you don’t have a federally backed mortgage and you are not able to pay your mortgage, you should still contact your mortgage servicer to see what options they may have available to you. Last, but not least be wary of scams. Unscrupulous Sleazeballs will try to take advantage of the current situation. Lean heavily on the advice of the CFPB.

Pete Jalbert

Maui Real Estate Blog

Great Ways to See Our Listings While Staying Home

In the last week, county and state government reclassified Realtors as “essential” workers. That means we can now show property. But let’s be honest, not all sellers want to invite buyers into their home right now. Not all buyers want to be going into someone else’s home. Quite frankly, as an agent I haven’t entirely wrapped my head around the idea of showing property. It’s ok to have concerns and to want to stay home.

It is also possible to stay safe at home and still “tour” some of our listings. Between videos and 3D tours, technology makes it a lot easier to see property while you aren’t even wearing pants. Check out videos and 3D tours for our listings below.

707 Puniawa Road, Haiku, HI

Nine acres in a quiet valley bounded by streams that come together at the edge of the property before running into the ocean. Two homes, two pools, an artist’s studio, an orchard, a kitchen garden, an off the grid power system and tremendous privacy. This property blends stunning natural beauty, sustainability and understated luxury. Intrigued? Check out the video tour below.

Find additional details on the property on the listing page for the Haiku Sanctuary.

1949 West Kuiaha Road, Haiku

The barn and some of the 30 acres of pasture land at 1949 West Kuiaha Road

Thirty-nine acres of pristine land with a deluxe barn, a story-book cottage and a small Christmas Tree Farm. Looking for a place for your horses? The property includes thirty acres of grassland with six gated paddocks, a round pen and a tack room. You can take a 3D Tour of the cottage here. Check out the listing page for additional photos and details for 1949 West Kuiaha Road.

886 Pakele Road, Wailuku

A restored 1943 Plantation Cottage set in a grove of soaring Coconut Palms right by the ocean’s edge. This place is a feast for the senses with the sounds of the ocean and rustling palm fronds, the smell of salt air and the stunning beauty of the Pacific. Take a 3D tour of the Cottage By the Sea. You can also check out this video for more sights and sounds from the property.

Check out the 886 Pakele listing page for additional details on the property.

61 South Lanikai

As one of a couple of land listings that we have in our inventory, these lots are something that we could show pretty safely while keeping a healthy social distance. That said, we also realize some of our potential buyers may be staying at home on the mainland. This listing is actually three contiguous two acre lots. The lots have water and ocean views. Check out the video below.

Check out the 61 Lanikai listing page for additional details on the property. One of the three lots is also available for purchase individually. 21 South Lanikai is a two acre lot. It is the lowest priced non-CPR lot with water in Haiku at this time. Photos and details on that individual lot are available here.

63 S. Lahaole Place Wailuku (Maluhia Country Ranches)

As another parcel of vacant land, this is another property that we could potentially show while practicing social distancing. This lot included 5.68 acres of land, big ocean and Haleakala views, gated access and underground utilities. You will be hard pressed to find this combination of views and land at this price point.

You can find additional details on the 63 S. Lahaole Place listing page.

In Person Showings and Other Resources

Contact the Maui Real Estate Team if you have questions on any of the properties above.

We realize that not all properties have good videos or 3D tours. If you see a property that is listed that lacks a tour or the video lacks important detail, let us know. We would be happy to look into the possibility of obtaining video of the property. Needless to say, if we list additional properties during the current pandemic, we will be leaning heavily on 3D tours and or video.

As mentioned at the top of this post, we are permitted to do showings. That said we are doing our best to stay at home. If the seller is amenable, we are willing to do showings under extraordinary circumstances. We will need to follow social distancing protocols throughout the showing. In the interim, we hope the videos and tours above provide a better feel for some of our beautiful listings.

Pete Jalbert