The Maui Luxury Home and Condominium market has been on a bit of a roller coaster ride over the last couple of years. This segment of our market was among the most resilient during the tail end of the real estate boom. During 2007 and the first quarter of 2008, luxury homes and condominiums were still fetching premium prices and seeing stronger sales volume. This was happening while almost all other segments of the market were seeing slumping sales volume or flat to depreciating prices. As the year progressed in 2008, the high end market started to change. Sales volume slowed rapidly. By the peak of the financial crisis in the fall of 2008, the pace of sales slowed to a trickle. Sales remained limited throughout much of 2009. While there were some very high end transactions, most of the properties that were moving were selling at a pretty substantial discount from the peak. The Maui luxury market was not immune to price adjustments.
As we are approaching the close of the first quarter of 2010, will we start to see some recoveries in sales volume? Is this market showing new life? The quantitative data suggests we aren’t quite there yet. We have the same number of home closes over $2,000,000 for the year at this time this year as we did at this time last year. That being said, there are some suggestions that there may be some additional improvements forthcoming. Barron’s just ran an article on improvements in the second home market. Maui was number one on the list of the top ten communities to buy second homes in the country. The article spoke of increases in activity among a number of high end enclaves. There are reasons for this increase in activity. While 2008 was a year of tremendous wealth destruction among some of the nation’s most affluent, 2009 proved to be a lot more prosperous. More millionaires and multi-millionaires means more potential luxury home buyers.
Last but not least, more than a few eyebrows were raised across the island when a Makena Beachfront Home listed for $27,000,000 recently went under contract. If this property closes at a price remotely close to its list price, it would set a new high water mark for single family homes. We will continue to keep an eye on the Maui Luxury market. Contact us if you have questions about or need assistance looking for luxury properties on Maui.