Maui Real Estate Market Update Q2 2023 Vol. 1

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The twenty-sixth edition of the market musings is slower out of the gate than usual. So let’s cut to the chase and look at the April Market Activity and a couple of other metrics that speak to current and future market conditions.

April Market Activity

The tables below show new Inventory, new pending sales and closed transactions for the month of April. The previous five years are shown for additional context. The numbers point to a markedly quieter April compared to previous years with of course one obvious exception. April of 2020 was of course a month with no off island visitors and stay at home orders for all but essential employees.

April 2023April 2022April 2021April 2020April 2019April 2018
Homes689412272117123
Condos91154182124161153
New Inventory in Maui in April 2023 and the previous five months of April.

New inventory continues to be limited on Maui. New home listings came in 28% below April of 2022. The number of new listings is 42% and 45% below April of 2019 and April of 2018. New condo inventory in April came in 41% lower than April of 2022. It came in 44% and 41% lower than 2019 and 2018 respectively.

April 2023April 2022April 2021April 2020April 2019April 2018
Homes65891244510891
Condos9214021633135166
New Pending Sales in April 2023 and the month of April during the previous five years.

The number of homes that went pending in April of 2023 is 27% lower than April of 2022. It is 40% lower than April of 2019 and 29% below April of 2018. The number of new pending condo sales in April is 34% below April of 2022. It is 32% lower than April of 2019 and 45% less than April of 2018.

April 2023April 2022April 2021April 2020April 2019April 2018
Homes55105129827488
Condos8516826285136176
Closed transaction in April 2023 and for each of the five previous months of April.

The number of homes that sold in April came in 48% lower than April of 2022. It came in 26% lower than April of 2019 and 37% lower than April of 2018. The number of Condo sales in April of 2023 is 49% lower than April of 2022. It is 37% lower than April of 2019 and 52% below April of 2018.

End of April Home Inventory

The charts below show active and pending home in inventory in April by price point and community. They also include the numbers from the previous two months to show the general direction of the inventory.

2/28/233/31/234/30/23
ActivePendingActivePendingActivePending
<$750,000107867 (-1)2 (-4)
$750,000-$999,9993028193524 (+5)25 (-10)
$1,000,000-$1,499,9995940473150 (+3)32 (+1)
$1,500,000-$1,999,999327291130 (+1)17 (+6)
$2,000,000-$2,999,999371338930 (-8)12 (+3)
$3,000,000-$4,999,999359361238 (+2)15 (+3)
$5,000,000-$9,999,99926935833 (-2)7 (-1)
$10,000,000-$19,999,99913112313 (+1)2 (-1)
$20,000,000+51605 (-1)0
Totals247115230115230112 (-3)
Active and Pending Home Sales by Price Point on the last day of the month between February and April.
2/28/233/31/234/30/23
ActivePendingActivePendingActivePending
Haiku27526418 (-8)10 (+6)
Hana11112110 (-2)3 (+2)
Ka’anapali1059511 (+2)4 (-1)
Kahului1888129 (+1)11 (-1)
Kapalua6210110 2 (+1)
Kihei2924241623 (-1)13 (-3)
Kula1414161319 (+3)15 (+2)
Lahaina16816314 (+2)4 (+1)
Makawao278231020 (-3)14 (+4)
Napili/Kahana/Hono…12214317 (+3)2 (-1)
Pukalani76647 (+1)2 (-2)
Sprecks/Paia100929 2
Wailea14715819 (+4)4 (-4)
Wailuku3521292630 (+1)23 (-3)
End of the month inventory of active and pending homes between February and April 2023.

Three Observations from the End of April Home Inventory

  • No big change. The biggest takeaway may be that the home inventory at the end of April is almost identical to the end of March. The active listings are the exact same and there are just three fewer pending listings.
  • Honing in on the market by price point, active inventory increased in more price points than it decreased. Pending sales increased in just as many price points as it decreased. The biggest increase in active home listings occurred between $750,000 and $999,999. The biggest increase in pending sales occurred between $1,500,000 and $1,999,999 with $2,000,000-$5,000,000 also seeing an increase in buyer activity.
  • Looking at shifts in inventory by community produced a mix bag. The inventory of active homes increased modestly in most communities. With pending sales decreasing in most communities. That said, there were some exceptions. Haiku active inventory dropped and pending sales rose sharply. Wailea’s active inventory increased the most and pending sales decreased the most.

End of April Maui Condo Inventory

The charts below provide end of the month active and pending condo inventory by price point and district. Keep in mind 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.

2/28/20233/31/20234/30/2023
ActivePendingActivePendingActive Pending
<$250,00022021 (+1)1 (-1)
$250,000-$499,999161414101413 (+3)
$500,000-$749,9994142482746 (-2)32 (+5)
$750,000-$999,9992945323126 (-6)38 (+7)
$1,000,000-$1,499,9993330273122 (-5)26 (-5)
$1,500,000-$1,999,9993335244225 (+1)40 (-2)
$2,000,000-$2,999,9991841173816 (-1)39 (+1)
$3,000,000-$4,999,9991217151712 (-3)17
$5,000,000-$9,999,99913013212 (-1)2
$10,000,000+506040
Total202226196200178208
End of the month active and pending condo inventory between February and April 2023.
2/28/233/31/234/30/23
ActivePendingActivePendingActivePending
Ka’anapali276231122 (-1)12 (+1)
Kahului344044 (+4)
Kapalua14513710 (-3)5 (-2)
Kihei5279594954 (-5)48 (-1)
Lahaina14917613 (-4)7 (+1)
Ma’alaea57546 (+1)6 (+2)
Napili/Kahana/Hono…5221432541 (-2)25
Wailea2885278924 (-3)91 (+2)
Wailuku78594 (-1)9
End of the month condo inventory by district between February 2023 and April 2023.

Three Noteworthy Things about the End of April Maui Condo Inventory

  • The condo market experienced a 9% drop in active listing and a 4% increase in pending listings from the end of March to the End of April.
  • The active condo inventory dropped in six price ranges, stayed the same in two and increased by just one in two price ranges. The biggest drop in active inventory occurred in the $750,000-$1,499,999 and $3,000,000 to $5,000,000 price ranges. Pending sales increased in four price ranges, decreased in three and stayed the same in three price ranges. The biggest increases in pending sales occurred between $250,000-$999,999.
  • Inventory levels decreased in the majority of the communities around the island. Kahului was unchanged and only Ma’alaea saw an increase with just one new active listing. Lahaina experienced the biggest drop in active listings as a percentage of overall inventory. Pending sales increased in the majority of communities with Kahului seeing the largest overall increase. The Napili/Kahana and Honokowai communities both saw no change in pending sales. Kihei and Kapalua both saw a decrease in pending sales.

What Kind of Competition Are We Seeing for Properties?

In 2021 and the first quarter of 2022, bidding wars were common in the market. We started to see that type of competition wane in the second half of 2022. During the first quarter of the year, I started to see a few more over asking price sales on the MLS. That was particularly true with parts of the vacation rental condo market. Buyers jockeyed for the limited inventory. I thought it was worth looking at competition this April compared to our last couple of “normal” months of April.

While our MLS database does not show whether listings received multiple offers, we can of course see when properties sell for over asking price. I will make the assumption that properties selling for asking price received multiple offers. I will admit, that isn’t a fool proof metric. There are circumstances where a motivated buyer will bid above asking to fend off potential or perceived competition that may or may not appear. I have also seen circumstances with multiple offers that do not exceed asking price.

Looking at April’s sales, 25.45% of all homes sold for over asking price and a total of 46.43% sold for asking price or above. With condos, 20% of the sales closed for over asking price and 47.06% sold for asking price or above. In April of 2019, 13.51% of homes sold for more than asking price and 33.78% sold for asking price or above. For condos in April of 2019, 14.6% sold for over asking price and 42.34% sold for asking price or above. It is pretty striking that the market is that much more competitive than pre-Covid numbers even with substantially lower sales volume.

How Quickly Are New Listings going Under Contract?

I haven’t looked at this metric in a musings since the fall. Back then, a spike in interest rates over 7% caused properties to sit longer. Recently, it seems like more properties went under contract quickly again. Our office’s two newest listings both went under contract within the first few days of coming to market. I thought it was worth seeing if the quantitative numbers matched the anecdotal.

I looked at new listings between May 1st and May 8th. During that period, 25 homes came to market. Forty percent went under contract within 10 days of coming to market. For that same period, 26 condos came to market. Just under thirty-five percent went under contract in ten days or less.

For context, I looked at the same range of dates from 2019. Of the 33 homes that came to market during that time, 18.18% went under contract in ten days or less. Of the 39 condos that came to market, 23.07% went under contract in ten days or less.

Market demand, at least for that particular week of May exceeds what we were seeing during the same period of 2019, our last semi-normal market. I say semi-normal just because that was a year of more limited inventory.

Interest Rate Watch

One advantage of being late to publish, I can tell you that May is on track to be a little busier than I expected. Pending home, condo and land sales on island are at a high for the year. That said, some potential headwinds are growing. As of May 26th, the average interest rate on a 30 year fixed mortgage rose to 7.14%. That’s the highest they’ve been since last November.

When interest rates were this high in the fall, activity slowed in the market. This was particularly true for homes under $1,000,000 and non-vacation rental condos geared towards Maui Residents. If rates stay this high, I wouldn’t be surprised to see a similar impact on the market.

One of the reasons for the recent increase in rates is due to the debt-ceiling standoff. At the time that I am writing this post, it looks there may be a possible solution to the debt ceiling crisis with President Biden and Speaker McCarthy coming to an agreement in principle. Now, that still needs to go to vote on the house floor. In today’s politics, I don’t anything for granted. If the deal is passed, rates may ease back down some. If it doesn’t pass… Yikes.

A Little Maui Beauty to Brighten This Post

Hana Home flanked by Palm Trees under the moonlight

A warm moonlit night, palm fronds rustling from a gentle breeze, and an ample porch for you and your friends and family to enjoy it all. Our new Hana Listing offers all of that and more.

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