Maui Real Estate Blog
Maui Market Musings Volume XXIV
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.
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.
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.
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.
|$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)|
|Total||258||100||257||99||247 (-10)||115 (+16)|
|Haiku||29||7||26||7||27 (+1)||5 (-2)|
|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.
|$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)|
|$2,000,000-$2,999,999||18||36||17||40||18 (+1)||41 (+1)|
|Ka’anapali||22||9||24||12||27 (+3)||6 (-6)|
|Kapalua||12||3||13||6||14 (+1)||5 (-1)|
|Kihei||61||45||65||72||52 (-13)||79 (+7)|
|Napili/Kahana/Honokowai||50||16||50||14||52 (+2)||21 (+7)|
|Wailea||27||79||26||81||28 (+2)||85 (+4)|
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.