Maui Real Estate Blog
Maui Market Musings Volume II
This week’s edition of Maui Market Musings is another grab bag of topics. I look at days on market on Maui, try to get a sense of price increases since the start of Covid and check in on sales activity at Hoku’ula, the new development in Upcountry Maui.
Properties Continue to Move Quickly
One way of gauging the strength of the Maui market is looking at days on market. The local Realtor Association publishes days on market for sold properties. I wanted to use data from recently listed properties for a more current look at market activity. Between February 9th and February 16th, 71 listings came to market. Of the 71 listings, 40 already went under contract. Of the remaining 31 listings, 7 are waiting to review offers until a later date or are in the process of reviewing offers. One bank owned listing successfully completed an auction with the buyer and the bank completing contract paper work. Two additional listings are vacation rentals with no opportunity for showings as of yet.
We are seeing things go under contract really quickly. What does this mean for buyers? Over 50% of properties are going under contract in 10 days or less. Many sellers are setting offer deadlines a week after listing to allow for strong showing demand. Multiple offers are common. Buyers who want to enter the fray need to have pre-approvals and proof of funds in hand. They also need to prepare to write very strong offers.
How Much Have Property Values Increased on Maui?
How much have prices gone up since the start of Covid? This is one of the most common questions people ask about the Maui market. This is a surprisingly difficult question to answer. The Maui market is incredibly heterogeneous. While changes in median price give some indication of changes in value, it isn’t an exact indicator. Changes in median prices aren’t just due to changes in price. Differences in the composition of the market in any one month also contribute to changes in median. For example, if you have a greater proportion of higher end homes selling in any one month, median prices will tend to go up.
With that in mind, I thought I would do my best to try to get a better sense of how much prices changed since early 2020. To do that, I went through the sales over the last month and compared them to sales during the same period of January and February 2020. I tried to find as many like for like properties to compare from each of the two time frames. Truth be told, the list of properties that fit that criteria is surprisingly small. Here are some of the properties I identified, notable differences if any, their sales prices and the percentage change.
Comparing Early 2020 and Early 2022 Home Prices
- The first example I found was actually a home that sold on January 31st of 2020 and sold again on February 9th of 2022. 24 W Makaukau Loop is located in the Waikapu Gardens subdivision of Wailuku. The seller made one notable improvement during their two years of ownership. They added a photovoltaic system with a Tesla Powerwall. It closed for $731,000 in 2020 and $990,000 in 2022. That is a 34% difference. If you add roughly $35,000 for the improvements, you are looking at a 29.4% increase in value.
- I found two very similar homes in the Pi’ilani Villages subdivision in Kihei that sold in 2020 and 2022 respectively. 38 Polale and 62 Polale are both three bedroom, two bathroom homes with 1,478 square feet of living space. Both homes have net metered photovoltaic systems. and new flooring. The home at 38 Polale has original bathrooms, while the home at 62 Polale includes nicely remodeled bathrooms. The lot at 38 Polale is 300 square feet bigger. The home at 38 Polale sold in early 2020 for $756,000. The home at 62 Polale sold in early 2022 for $1,100,000. That is a 45.5% difference in value. Regardless of the bathroom improvements, this is a big shift in values.
- While the next two homes don’t offer a true apples to apples comparison, they are still worth sharing. Both homes are in Kaimana at Kehalani. This is a subdivision with a single developer and a handful of different floor plans. The first home is a 4 bedroom, 3 bath with 2,021 square feet of living space and a Photovoltaic system. The home is located on a 4,500 square foot lot. The second home is 3 bedrooms, 2 bathrooms with 1,185 square feet of living space. It is also situated on 4,500 square foot lot. The 4 bedroom home sold in early 2020 for $725,000. The second sold for $815,000. That is a 12% higher sales price for a home that is 41% smaller.
Comparing Early 2020 and Early 2022 Condo Prices
- The first two condos I wanted to compare are located in the same floor of the same building at Aina Nalu in Lahaina. They are both 2 bedroom, 2 bath unit with 832 square feet of living space. Unit C 203 sold in early 2020 for $599,000. The seller did add some new flooring and there was some sort of bamboo ceiling covering added in parts of the condo. Unit C 209 was almost identical minus the improvements. It sold in early 2022 for $766,000. That is a 27.8% price increase. It is worth noting that Aina Nalu was one of a small handful of condos that actually saw prices go down in mid 2020. During that time, second floor two bedrooms went as low as $500,000. The level of appreciation is that much higher if you factor in that price adjustment.
- Kai Malu is an upscale non-vacation rental condo in Wailea. There is variability in value within the complex based on location and view. I found two condos with the same 3 bedroom, 2.5 bathroom floor plan in different parts of the development. Both are considered to be good locations. They both overlook the golf course with the ocean in the distance. Unit 5A sold in late January 2020 for $1,700,000. Unit 55B is a little more upgraded unit with some more recent renovations. It sold for $2,200,000 in early February. That is a 29.4% increase in sales price.
- Kihei Villages is an entry level condo complex that prohibits short terms rentals. I found two pretty similar ground floor units for comparison. Both have two bedrooms, one and a half baths and 750 square feet of living space and an enclosed yard area. Unit 10-103 had some improvements in the kitchen, but bathrooms appeared to be original. It sold in February of 2020 for $365,000. Unit 34-103 was well maintained with a nice yard, but no upgrades to the kitchens or bathrooms. It sold for $535,000 in February of 2022. That is a 46.5% difference in value.
- I compared two one bedroom, one bath listings in building 2 at Maui Vista. This is a vacation rental friendly condo in Kihei. Both units appeared to be in original condition. Unit 2203 sold for $420,000 in February of 2020. Unit 2308 sold for $572,000 in January. That is a difference of 36.19%.
While this is a relatively small sample size, it does provide both homes and condos over a pretty broad area of the island. Overall, here are my takeaways from this number crunching exercise. You are looking a bare minimum of 27% appreciation over the last two years with some properties seeing more significant increases. There is some variability in appreciation around the island. While all these prices are moving in the same direction at this point,some are taking a little longer to get there.
The significant price increases appear to be continuing. Anecdotally, bidding wars feel that much more competitive of late. In turn, it feels as if values skipped up on some of the properties going under contract over the last few weeks. It will be interesting to see if the sales numbers corroborate this in the months ahead.
Hoku’ula Lottery Update
Last week I posted about the lottery for first phase of the market priced listings at Hoku’ula. This development in Hali’imaile is one of the largest developments ever in Upcountry Maui. It will include 196 total homes with 98 work force housing homes and 98 market rate housing homes. The work force housing units are fully reserved. The developer held a lottery for the first phase of the market rate housing at the end of last week. Per the developer’s representatives, 15 homes went under contract as a result of the lottery. That is half of the 30 homes in the first phase. Registrations for the first phase may still be submitted. Contact The Maui Real Estate Team for buyer representation if you are interested in the development.
Well, so far so good on making this a regular feature of our blog. We are hoping that this is valuable tool for buyers and sellers trying to get a better sense of the market. Feel free to reach out if there are any specific things you might want us to discuss in future volumes of the musings. Contact The Maui Real Estate Team if you need assistance buying and selling property.
Maui Real Estate Blog
September 2015 Maui Real Estate Statistics
It has been a busy month for me and the rest of the Maui Real Estate Team. We have seen more buyer activity than usual for our “slow” season and we have some exciting new listings that we have brought to market. Our busy fall is reflected by the fact that I am not putting out a monthly stats post until October 28th. Since it is so late in the month, this is going to be more abbreviated than usual. That said, I will still have information on sales volume, median prices, pending sales and some notable numbers from the September sales activity. Without further ado, here are the numbers.
Maui Sales Volumes and Median Prices
There were 97 homes sold in September with a median price of $573,000. During September of 2014, there were 95 homes sold on Maui with a median sales price of $570,000. That calculates to 2% increase in sales volume and a .5% increase in median price.
There were 109 condos reported sold in September with a median price of $399,000. Last September, there were 80 condo sales with a median sales price of $462,500. That calculates to a 36% increase in sales activity and a 14% drop in median price.
There were 17 land sales reported in September with a median sales price of $625,000. Last September, there were 12 land sales with a median price of $520,000. That is roughly a 42% increase in sales activity and a 20% increase in median price.
Notable Numbers from The September Sales Activity
While compiling the median prices and sales volumes, I came across some other numbers from the September Real Estate sales activity that I thought were worth sharing.
- The highest priced home sale during the month occurred Upcountry. A 22 acre estate in Kula with a 4,972 square foot main house and a 1,268 square foot cottage sold for $6,500,000.
- That was one of five total home sales of $2,000,000 or more in September. There was one other sale in Kula, 2 sales in Wailea and one sale in Kapalua.
- The highest priced condo to sell in September was located at Montage Kapalua Bay. The 3 bedroom, 3.5 bath condo with 2,789 square feet of living space sold for $4,900,000.
- The Montage sale was one of 8 sales over $1,500,000 during September. The other 7 transactions included another sale at Montage, 2 Hoolei, a Honua Kai, a Kai Malu, a Ritz Carton Residence, a Wailea Point and a Kai Malu.
- There were two separate lots in the Maluaka Estates neighborhood of the Makena Golf and Beach Club that closed for $9,000,000 a piece in September. The lots were 19,602 and 17,340 square feet respectively. It is safe to say that the Makena Golf and Beach Club is continuing to see the highest per square foot prices for land on the island.
- There were 15 bank owned transactions that sold on the Maui MLS in September. In September of 2014, there 13 bank owned sales.
- There were 4 successful short sale transactions in September of 2015 which is down from the 6 short sales that closed in September of 2014.
Pending Sales in September
The majority of the September sales were based on contracts that were written in July and August. With that in mind, we wanted to see what type of activity we were seeing from buyers in September. The following chart shows the number of homes, condos and parcels of land that went under contract in September compared to the number of properties that went under contract in September of 2014.
It was a strong month of buyer activity in September with the number of homes that went under contract significantly higher than the number in September 2014. Condos activity is up slightly and land contracts mirrored what we were seeing last year. I would surmise the big increase in home activity is still related to the low interest rates and buyers wanting to obtain properties while those low interest rates last.
Thoughts on the September Stats and the State of the Market
This is the fourth month of a row where the 2015 sales volumes were higher than the sales numbers for the same month of 2014. As mentioned above, I believe most of this can be attributed to buyers trying to “get in” before interest rates increase. The urge to get in is heightened by a difficult Maui long term rental market that has seen rents increase drastically over the last 3 years.
What does all of this mean for buyers and sellers? Well priced properties continue to be very competitive, particularly with properties below or near the median home price. The last three offers I submitted were for homes located in Upcountry Maui that were near or below the median sales price. All three offers were competitive bidding situations. This type of activity is common throughout the different geographic areas of the island. This means buyers will need to be prepared to act quickly when a good opportunity comes on the market. If a buyer will need a mortgage for their purchase, they should get pre-approved before they even start looking at homes. Sellers, particularly those with homes that are valued near or below median prices, will find that this is a good time to sell. To be clear, that doesn’t mean sellers have carte blanche when it comes to pricing. Overpriced properties are still sitting in this market. Contact The Maui Real Estate Team if you are interested in buying or selling a property on Maui. We would welcome the chance to sit down with you and listen to your real estate needs.
Maui Real Estate Blog
Maui Luxury Condo Market Update
Earlier this month, we took a look at Maui’s Luxury Home Market. Today, I wanted to turn my sights towards the high end condominium market. This post will include totals on all of the condos sold for the year to date (as of September 20), notable numbers from this year’s sales, and market conditions specific to the three resort areas of Wailea/Makena, Ka’anapali and Kapalua.
When we have discussed luxury condos on our blog, we have used the $1,500,000 and above price point as the threshold for pricing. When we first started to look at the luxury condo market, that was something of a starting point for some of the really high end condos. To be clear, there are some very nice condos below this price point. That said, we want to be consistent with our methodology. So all properties discussed in this particular blog sold for $1,500,000 or more.
Maui Luxury Condo Sales Volume and Median Price
There were 69 condos sold thus far this year as of September 23, 2015. The median price for those sales was $2,250,000. Between January 1, 2014 and September 23, 2014, there were 63 sales at a median price of $2,575,000. That is roughly a 10% increase in volume and a 13% decrease in median price.
Notable Luxury Condo Sales Numbers for the Year to Date.
Here are some of the most noteworthy numbers from the luxury condo sales this year.
- The highest priced condo to sell thus far this year closed for $8,500,000. This is a three bedroom, three and a half bath, beachfront unit with 2,919 square feet of living space at Wailea Beach Villas.
- Including the sale at Wailea Beach Villas, there were a total of 12 condos sold over $4,000,000.
- Honua Kai saw the most sales activity of any condo complex on the island. There were a total of 20 sales at Honua Kai over $1,500,000 including 11 new developer sales.
- The Wailea and Makena Market saw the most sales activity over $1,500,000 with a total of 28 sales. Kaanapali saw the second most activity and Kapalua was third.
- In addition to the sales activity in the major resort markets, there was one sale in Lahaina, one in Kihei, one in Spreckelsville and two on Lanai.
- There were no bank owned condos or short sale transactions among this year’s sales
Wailea and Makena Condos
Wailea and Makena have had a good year for sales to date. The 28 sales reported exceeded last year’s total of 20. That is a 40% increase in activity. Much of that increase in activity occurred in Makena. While there was only one sale in Makena during the same period last year, this year there were 6 sales. Five of the six Makena sales were at Makena Surf. The remaining sale was at Na Hale O Makena. This was a particularly busy year for Makena Surf with the five sales reported thus far more than any year since 2004.
The Wailea sales over $1,500,000 were spread out among a variety of complexes. There were 7 sales at Hoolei, 1 at Andaz, 2 at Kai Malu, 1 at Papali, 1 at Wailea Ekahi, 3 at Wailea Elua, 3 at Wailea Beach Villas and 3 at Wailea Point. Hoolei continues to lead the way in high end sales in Wailea. The size of the condos combined with their price point and the potential to access amenities at the Grand Wailea continues to be an attractive option to buyers. While Wailea Beach Villas did not have the same sales volume, it was noteworthy for the fact that it had the top two highest priced condo sales on the island thus far this year.
It will be interesting to see what happens in the Wailea and Makena market for the rest of the year and into 2016. There is still a good selection of variety to choose from on the MLS. There is plenty of active inventory on the MLS with 40 condos on the market. There are unlisted properties available at Andaz and the new Keala O Wailea development. There is also a chance that we might see pre-construction sales at Makali’i at Wailea before the end of the year. You can see all of the current Wailea and Makena Condos listed on the MLS on MauiRealEstate.com. Contact The Maui Real Estate Team if you have questions on any of the unlisted properties.
The Ka’anapali Condo market has also had a fairly strong year with 26 sales reported to date. That is down 7% from the 28 units sold during the same period last year. The Ka’anapali market has been buoyed over the last several years by activity at the Honua Kai Resort. Honua Kai has been a big draw as the first fee simple whole ownership new development along this stretch of coast for over 20 years. Of the 26 condos sold in Ka’anapali for $1,500,000 or more, 20 were at Honua Kai. Ka’anapali Ali’i has had 5 sales thus far this year. There was also one sale at the Masters.
The Ka’anapali luxury condo market is starting to see shrinking inventory with only 20 active listings over $1,500,000. A big part of that stems from Honua Kai. The developer is getting close to selling out their remaining units. There are only 3 new developer listings left on the MLS. I believe there are still a handful of additional new developer units in addition to those posted on the MLS. There are only three units active at Ka’anapali Ali’i with the remaining listings located at Ka’anapali Shores and the Whaler. It will be interesting to see if the dwindling inventory at Honua Kai will have an impact on places like the Whaler and Ka’anapali Shores. Buyers have shown a preference for the newer Honua Kai Condos leading to depressed sales at the other places. Will some of the older condos nearby start to see an uptick in activity? You can see the full inventory of Kaanapali Condos listed on the MLS via MauiRealEstate.com.
The Kapalua Market has seen pretty similar activity levels to what we saw last year. There have been 10 sales reported in the year to date this year. There were 9 sales reported over the same period last year. The focal point for luxury condo sales in Kapalua has been the Montage Residences on Kapalua Bay. Montage came on the market last June. This property was formerly the Ritz Carlton Residences. The Ritz Residences went into foreclosure and the property was purchased by Lantern Capital. Lantern appointed Montage to manage and revamp the property. Montage has seen steady sales since it has come on the market despite pricing that starts in the mid three million dollar range. There have been 8 sales reported at Montage thus far this year.
The other notable sale was at Ritz Carlton Residences. To be clear, this is a different animal from the Ritz Residences Kapalua Bay that was previously foreclosed upon. These condos are part of the Ritz Carlton Hotel. The Ritz condos had been on the market closer to the downturn and weren’t getting as much traction. They are back under the market with a new sales team. It will be interesting to see how these condos are received by the market going forward. From what I have heard, they are getting a pretty good response.
While the two new developments have been relatively well received, some of the older complexes have seen slower activity. High end Kapalua condos like Coconut Grove and the Ironwoods are traditionally condos that see limited inventory and limited sales volume. There was one sale in the Ironwoods this year. Kapalua Bay Villas is a condo that seems to be getting poor market feedback by luxury buyers. There have been 4 sales over $1,500,000 at Bay Villas since 2009. There are currently 7 active listings in the complex with none pending. It appears as if sellers in this complex may need to adjust pricing if they are going to generate interest from buyers.
For the rest of the year, I would anticipate that we will continue to see activity at Montage and the Ritz. Buyers in Kapalua have a good selection of inventory to choose from. You can see the full inventory of Kapalua Condos on the MLS on MauiRealEstate.com. Contact The Maui Real Estate Team directly if you would like us to assist you with buyer representation at either the Montage or the Ritz. There is more inventory available at both of those condos than what is showing on the MLS.
Other Condo Sales Around the Island
In addition to the activity at the resort communities, there have been a handful of sales from other communities around the island. There was one sale in Spreckelsville at Sugar Cove, one in Lahaina at Puamana and one at the Royal Mauian in Kihei. There were also two sales over on Lanai including one at the Terraces at Manele and the other was at the Palms at Manele. The two Lanai purchases were both Larry Ellison buys as he continues to expand his holdings on the island. We tend to see limited activity on higher priced condos outside the main resort areas not so much due to lack of demand as it is a lack of inventory. There are only a handful of condos outside the resorts that can sustain prices of $1,500,000 or greater and they tend not to have a ton of inventory.
Overall Thoughts on the Maui Luxury Condo Market
Buyers still have a great collection of condos to choose from around the island. There are both new development opportunities and condo resales in more established condominiums. While the depth of the inventory may provide options, sellers in this price range tend to have more staying power. The challenge is finding potentially motivated sellers who might want or need to redeploy their money elsewhere.
I would expect that the luxury condo market will continue to be perform at or near the levels we have seen for the year to date. While interest rate increases have been postponed, this isn’t a part of the market that is as interest rate sensitive. The bulk of the buyers are using cash or private banking. The biggest potential impacts to the market come from the greater global economy. Poor performance in the stock market is a potential threat. There seems to be something of a correlation between the DOW and high end sales on the island. We have not seen any significant influxes of buyers from China like some cities in the Western U.S. and Canada. Contact The Maui Real Estate Team if you are interested in buying or selling a luxury condo on Maui. We would welcome the chance to sit down with you for a free consultation and to discuss your interests and needs.
Maui Real Estate Blog
May 2015 Maui Real Estate Statistics
Needless to say, this month’s stats post isn’t a sneak peek. We are over halfway through the month and just getting around to our May stats. Sometimes blogging has to take a back seat to other parts of the business. The good news is that I have been having a tough time carving out time to blog due to obligations with buyers and sellers. Enough about me and on to the stats. This post includes information on sales volume, median prices, notable sales and pending sales. I also give a few thoughts on what it all means for buyers and sellers. Without further ado, here are the May 2015 Maui Real Estate Statistics.
May Maui Real Estate Sales Volumes and Median Prices
There were 88 home sales reported in Maui County last month with a median price of $607,097. Last May, there were 86 sales reported with a median price of $537,500. That is roughly a 2% increase in sales volume and a 13% increase in median price when comparing this May to last May.
There were 108 condos reported to have been sold in May of 2015 with a median sales price of $469,500. In May of 2014, there were 117 sales reported with a median sales price of $472,000. That calculates to an 8% decrease in sales volume and just under a 1% decrease in median price.
There were 12 land transaction reported by Realtors in Maui County during the month of May with a median sales price of $563,750. By comparison, there 20 sold last may with a median price of $575,000. Those numbers calculate to a 40% drop in sales activity and a 2% drop in median price.
Other Notable Numbers from The May Maui Real Estate Sales Activity
While compiling the sales volumes and median prices, I came across some more notable numbers that I thought were worth sharing.
- The highest priced home sale last month was $5,695,000 for a 26.8 acre property in Haiku on Maui’s North Shore. The Haiku Farms property included 7 dwellings and 6 county water meters.
- The Haiku Farms Sale was one of 6 home sales on island over $2,000,000 in May. The other sales included 3 Kapalua homes, a home in Hana and a home in Wailea.
- The highest price condo transaction in May was for a unit at Wailea Point. The three bedroom, four bathroom oceanfront condo sold for $5,000,000.
- The Wailea Point Sales was one of twelve total condo transactions over $1,500,000. The other big sales included 6 at Honua Kai, 2 at Kai Malu, a Montage Kapalua, a Puamana and a Papali Wailea.
- The highest priced land sale in May was $1,425,000 for a 10.2 oceanfront acres in Haiku.
- There were 12 bank owned or REO sales last month. By comparison, there were 8 REO sales last May.
- There were only 3 successful short sales completed last month. There were 10 short sales last month. Short sales continue to decrease as appreciation continues.
Some Quick Thoughts on the Maui May Real Estate Sales Numbers
The May Maui Sales numbers stuck pretty close to the script for what we have seen thus far in 2015. Home sales were slightly above last year’s numbers. That is now four months out of five where sales have outperformed the same month from the previous year. Condo and land sales were both down. That makes four out of five months that condo sales have been below the same month the year prior. Land sales have been down three out of five months compared to the same month from the year before.
We typically, don’t spend a whole lot of time discussing change in median prices on the blog. It’s a bit of frustrating subject. All too often, I see discussions of the Maui Real Estate statistics where changes in median are depicted as a reflection of changes in property values. While appreciation can play a part, the biggest shifts in median are driven by the change in composition of sales. I thought this was worth bringing up as home medians pushed above $600,000 for the second time this year. We are seeing modest appreciation, but we are also seeing more activity at higher price points and fewer properties available in the lower price ranges.
Pending Sales in May
The majority of real estate transactions on Maui take 30-60 days to close. With a few exceptions, the sales in May were based on contracts penned in March and April. With that in mind, we wanted to look at buyer demand in May. The following offers a comparison of Pending Sales in May of 2015 and May of 2014.
May 2014 and May 2015 were very close to each other in terms of pending sales activity. There was one more home, four fewer condos and three more parcels of land that went pending. This would suggest that we shouldn’t see too big of a difference in between the June 2015 and June 2014 sales.
What Does This All Mean for Buyers and Sellers?
Market conditions remain unchanged on Maui. Buyers interested in the market will find varying market conditions depending upon geography and price point. Homes priced at or below the market medium tend to be scarce and have the highest demand. Well priced, clean properties below the median sales price can attract multiple offers and over asking bids. As you move up in price, demand will tend to go down, but well priced properties can still sell quickly. Before sellers begin to pop the champagne corks, this isn’t an out and out frenzied sellers market. Over priced properties are tending to sit and not all areas of the island are seeing the same levels of demand. Sellers will need to take into account market conditions specific to their town and neighborhood when developing go to market pricing. Contact The Maui Real Estate Team if you are considering entering the Maui Real Estate Market. We would be happy to sit down with you to listen to your needs and give you an update on market conditions specific to your interests.
Maui Real Estate Blog
Sneak Peek at the April 2014 Maui Real Estate Stats
I begin this post with a humble apology. Last month was the first time that we have failed to provide some version of the monthly Maui Real Estate stats since 2008. For those that have come to expect this place to be the first resource to go for getting a pulse on the Maui market, I apologize for letting you down. If you didn’t see last month’s stats via another media outlet, here is a link to the Realtor Association of Maui March Stats. I will try to redeem myself with an expanded post that includes a cornucopia of Maui market numbers. April is a month of transition in Maui. It is the end of whale season, peak tourism season and peak real estate season. The real estate sales figures are typically pretty strong as we see lots of closes from properties that went under contract earlier in peak buyer season. Keep reading to see the April sales volume and median numbers, a few interesting numbers and tidbits from among this month’s closes, a broader look at the first four months of the year, some forecasting as to what we may see for sales in the coming months and a few other thoughts on the Maui market. Without further ado, here are the numbers.
By my count, there were 84 home sales reported in April with a median sales price of $583,000. By comparison, last April there were 79 home sales with a median price of $470,000. That is a 6% increase in sales volume over last April and a 24% increase in median.
There have been 134 condo sales reported for April with a median price of $403,500. There were 144 sales reported last year with a median price of $370,000. That is a 7% decrease in sales activity and a 9% increase in median prices.
There have been 19 land sales reported to date for April of 2014 with a median sales price of $510,000. Last April, there were 14 sales reported with a median price of $479,500. That is a 35% increase in sales volume and a 6% increase in price when comparing this April to last April.
These are preliminary numbers, we may see some additional sales reported from the end of the month in the next couple of days. While compiling the numbers above, I found a few other numbers that I thought were worth sharing.
- The highest priced home sale in May was a beautiful estate in the Makena Papa’anui subdivision located just above Makena Landing. The home with stunning ocean views and infinity pool closed for $6,850,000.
- That was one of six sales over $2,000,000 in April. There was one other sale in Makena Papa’anui, three sales in The Pineapple Hill Neighborhood of Kapalua and one Oceanfront home in Haiku.
- The highest priced condo transaction for the month was located at the Honua Kai Resort. One of the premier three bedroom units in the complex closed for $5,200,000.
- This was one of six condos that closed for $1,500,000 or higher in April. There was one other sale at Honua Kai along with sales at Kai Malu, Hoolei, Wailea Beach Villas and Ka’anapali Ali’i.
- There were only 9 bank owned (REO) closes last month. In April of 2013, there were 13 REO sales. This remains a pretty limited market segment and it seems as if a good number of the REOs that enter the market are being priced fairly high by the banks. With a limited inventory of lower priced homes, banks are trying to get more money for their assets.
- There were 10 successful short sale transactions this April compared to 15 in April of 2013. While I expect the slow drip of bank owned properties to continue, I suspect we may see the number of short sales continue to shrink under current market conditions. Better equity conditions for sellers and stiffer tax liabilities for owner occupants who complete short sales are going to reduce the impact of this type of sale.
This months stats were almost directly the inverse of last month’s stats and the overall trends for the year. Home and land sales were higher in April of 2014 than they were in April of 2013. Condo sales were down compared to last April. Overall for the year, we have seen higher condo sales while both land and home sales have been lower. I wouldn’t read too much into one month’s trends as we are likely just seeing some of the variability we tend to see with Maui’s smaller sample size of transactions.
As we tend to point out in our stats posts, it is important not to paint with too broad of a brush in Maui. Sales activity varied by community and price point around the island. Some communities are seeing more activity than last year. Some are seeing less than last year, and some are seeing almost the same. Here are some of the markets that are seeing some of the biggest differences in sales activity between this year and last year.
- Haiku residential sales are down 21% (four units) compared to the first four months of 2013. That reduction can be attributed entirely to a decrease in inventory and activity at or below the median with four fewer sales below $600,000.
- Pukalani has seen a 43% decrease in residential activity compared to the first third of 2013. This appears to be another community where reduced inventory is impacting sales. There were far fewer sales in Pukalani under $500,000 this year compared to the first four months of last year.
- Wailuku sales are down 16% (7 units) compared to the first four months of 2013. This was also driven in part by a decrease in inventory and sales below $500,000.
- Makawao residential sales are up 55% (6 units) compared to last year. This surge was based on an increase in activity at higher price points. There were 7 more sales over $500,000 compared to the same time last year.
- Kapalua sales are up 150% (3 units) compared to the first 4 months of last year. This is a pretty small sample size which makes the number a little more dramatic.
- Kihei condo sales are up 22% (30 units) over the first four months of last year. This increases has occurred despite a pretty sharp drop in inventory below $200,000. The biggest increase in sales activity occurred between $250,000 and $500,000 with more modest gains above $500,000.
- Condos in the West Maui Communities of Napili, Honokowai and Kahana were up 19% (11 units) over the first part of 2013. This community was somewhat anomalous in that there were more gains at lowest price points rather than the middle and higher price points.
- Wailea saw the biggest dip in condo sales with a 22% (9 units) decrease in sales volume compared to the first four months of 2013. With a couple of new developments on the horizon in Wailea, we may be seeing some buyers deferring purchases as they wait for opportunities to purchase new construction condos.
I also thought it was worth looking at changes in sales activity by price points during the first four months of the year.
- Home sales under $500,000 were down 26% (36 units) compared to the first 4 months of 2013. This is a clear case of decreasing inventory impacting volume.
- Home sales from $500,001 to $999,999 were up by 2.8% (3 units) compared to first third of 2013.
- Home sales were up 54% (22 units) in the $1,000,000 and up price range. The high end market appears as if it is continuing to gain steam after a relatively strong 2013.
- Condo sales priced $250,000 and under were down 21% (22 units). This is a case of shrinking inventory.
- Condos priced between $250,001 and $499,999 are up 28% (49 units). This is due to a combination of appreciation in the market and a general increase in activity.
- Condo activity between $500,000 and $999,999 was up modestly at 9% (9 units).
- Condo sales between $1,000,000 and $1,499,999 was up 22% (6 units).
- Condo sales from $1,500,000 and above were up 45% (9 units). This is pretty impressive as this market segment was up significantly in 2013 over 2012.
The numbers above would seem to indicate that recent market activity is being dictated in part by available inventory. The only part of the market that is seeing less activity is the part that has seen inventories decrease the most in the last year. There are buyers looking at lower price points, but they aren’t finding the properties that they want. The increase in activity at the higher price points also accounts for some of the increases we are seeing in median prices. It is a combination of price increases and more high priced transactions that are causing the jumps in medians. Don’t mistake increases in medians as a true reflection of increases in values.
While sales are a reflection or recent market demand, the number of properties under contract better illustrates current market demand. As we have been moving out of peak buyer season, the total number of pending properties has been dropping steadily. This is a little different than what we have seen in the last few years when the momentum of peak season carried into May. The chart below compares the number of homes, condos and parcels of land that went under contract in April with the number that went under contract in April of 2013.
The numbers show a pretty sharp dip in both homes and condos. It will be worth keeping a close eye on May pending sales to see if we are seeing something of a trend or if this month is just an anomaly.
What does all of this mean for buyers and sellers? Buyer and seller strategy is going to be dictated in part by community and price point. That said, there are a few statements applicable to all geographies. Entry level buyers are going to find a limited inventory and competitive market. Getting pre-approved for financing is a must prior to starting your search. When you find a property that you like that is well priced, decisive and fast action is typically necessary. Some of the higher price points in the market offer a broader range of inventory, but seller motivation tends to go down. Buyers may find that the staying power of luxury home owners can undercut their leverage even in markets with lots of inventory. Sellers who need to sell in quick fashion will need to look closely at recent comparable sales and the level of market activity around their price point. Over priced properties are sitting in this market. Current market conditions can be challenging for both buyers and sellers. The Maui Real Estate Team would welcome the chance to sit down for a free consultation to discuss your real estate needs and how we might be able to help you navigate the market. Contact the Maui Real Estate Team today to get started.
Maui Real Estate Blog
Wailea and Makena Market Report: 2013 Year in Review and 2014 Outlook
Earlier this winter, I decided to do some in depth market reviews on a handful of communities around the island. I was able to publish posts on Paia and Spreckelsville, before getting sidetracked. I have wanted to take on the resort markets of Wailea and Makena for quite some time. This is a post that has been sitting in some form of a draft for the better part of the month. A busy schedule as a Realtor and a new dad, combined with the breadth of this market has made it tough to put the finishing touches on this post. Today, I finally got over the hump.
The Wailea and Makena resort communities are home to some of the more expensive real estate on island. Homeowners are drawn by the weather, the incredible beaches, shopping, dining, resort amenities and golf courses. In this post, we wanted to compare 2013 sales to what we saw in 2012. We also want to provide a few thoughts on what you might expect for the rest of 2014 in the Wailea and Makena market. Since we are almost to the end of the first quarter of 2014, we have the advantage of being able to review some of the initial sales data for the year. Without further ado, here are the numbers for Wailea and Makena in 2013.
There were 27 homes sold in the Wailea area with a median price of $2,750,000 during 2013. There were 26 homes sold during 2012 with a median price of $1,387,500. That is roughly a 4% increase in sales volume and a 98% increase in median price.
During 2013, there were 123 condos sold in the Wailea area with a median price of $1,100,000. The 2012 numbers were 114 condos sold with a median price of $757,500. That is approximately an 8% increase in sales volume and a 45% increase in median price.
During 2013, there were 13 lots sold with a median price of $1,225,000. There were 5 lots sold during 2012 with a median price of $875,000. That is a 260% increase in sales volume and 40% increase in median price.
In addition to the numbers above, here are a few other numbers that I thought were worth sharing regarding the Wailea and Makena Real Estate market during 2013.
- Of the 27 homes sold, six were in the Makena area.
- The high sale was $9,200,000 for an oceanfront home at Makena Place.
- The Makena Place transaction was one of 14 sales over $2,0000,000. It was one of 7 sales over $5,000,000. In 2012, there were 8 sales over $2,000,000 with 3 sales over $5,000,000.
- There were only 2 homes sold for under $1,000,0000 in Wailea during 2013. That is way down from the seven sold under $1,000,000 in 2012.
- The high condo sale was $11,395,000 for a Villa at The Andaz Residences.
- The Andaz close was one of 34 condo sales over $1,500,000 in 2012. That was an increase over the 27 sold for $1,500,000 or more in 2012.
- Kai Malu and the Palms at Wailea were the condos that had the most sales activity with 23 sales and 16 sales respectively.
- Only 3 of the 123 condos sold were in Makena. There was one unit sold in Na Hale O Makena and two units at Makena Surf.
- There were only 2 condos sold in Wailea for less than $500,000 in 2013. That was down significantly from the 15 sold under $500,000 in 2012.
- The high sale for land was $10,000,000 for 159 acres across the street from the ocean in Makena.
- There were 5 bank owned sales (REO) in Wailea in 2013. That is a 50% reduction from the 10 that sold in 2012.
Looking at the Wailea and Makena sales data for 2013, the big jumps in median prices are arguably the most eye catching numbers. All too often the change in median prices can be misrepresented as a representation changes in property values. While it is safe to say there was some appreciation in Wailea, it is also pretty clear we didn’t see 98% increases in home values, 45% increases in condo values and 40% increases in land values. The big bumps in median come from a decrease in sales activity at the low end of the market and an increase in ultra luxury sales.
The inventory of homes under $1,000,000 and condos under $500,000 decreased sharply in 2013. Buyers searching for lower priced opportunities had options in places like Wailea Fairway Villas and Grand Champions. In 2013, inventory in both of those complexes decreased and prices increased. That pushed prices on all but two sales in those complexes above $500,000. The same trend was evident with Wailea Homes. In 2012, there were quite a few opportunities to get into the market below $1,000,000 in neighborhoods like Wailea Kai, Wailea Pualani and Wailea Kialoa. Those opportunities were far more limited in 2013 with only 2 home sales below $1,000,000.
While there were fewer bargain hunting opportunities, more buyers were willing to dish out a premium for Wailea and Makena Properties. There was a 26% increase in the number of condos sold over $1,500,000 and a 75% increase in the number of homes sold over $2,000,0000. This was part of an island wide increase in luxury sales activity. As we have postulated in other statistics posts on our blog, big years on the stock market tend to make for big years for luxury real estate sales on Maui.
Being that we are almost done with the first quarter, there is more opportunity to comment on current real estate market dynamics in Wailea and Makena. The chart below compares the number of properties sold this year as of March 17th with the number of properties sold last year through March 17th.
As you can see from the chart, the sales activity looks pretty similar to what we saw during the start of 2013. Home sales are up modestly by 2 transactions, condo sales are the same and land sales are off by 1 from last year’s pace. There were a few other things that I thought were worth sharing from year to date sales activity.
- As mentioned previously, we saw a decrease in sales under $500,000 for condos and under $1,000,000 for homes in Wailea during 2013. That trend has continued into 2014. There have been no condo sales under $500,000 and no home sales under $1,000,000 to date. There are no homes listed or pending for less than $1,000,000. There are only two pending sales under $500,000 for condos with no active listings in that price range.
- For the most part, the Wailea market is still trading for less than peak market prices. There is one exception though as Wailea Elua saw its two highest ever sales prices in the last couple of months.
- The high home sale thus far this year was $9,300,000 for an oceanfront home in Makena Place. As of March 17th, that was one of 4 home sales to date this year over $2,000,000 in Wailea and Makena.
- The high condo sale thus far this year is $4,450,000 at Wailea Point. As of March 17th, that was one of 9 condo sales over $1,500,000 in Wailea and Makena for the year to date.
What can we expect for the rest of the year in Wailea and Makena? Demand thus far appears to be close to what we saw last year. I would anticipate that to continue if the stock market and overall economy stay the course. We have seen a decrease in Canadian luxury home buyers with the Canadian Dollar off 10% from last year. That has the potential to decrease sales volume. With the exception of lower priced homes and condos, there appears to be a pretty healthy inventory for buyers to choose from. There is over a year of active inventory for homes and land. There is just under a year of active inventory for condos, but that inventory is likely to increase. New developments are likely to have some of the biggest impact on the market. We have seen two new development go to market thus far, with at least one more and possibly three more coming to market before the end of 2014.
The first new development to hit the market was small in listings and big in price tag. Makena Sunset will consist of four condominium homes located directly across the street from Maluaka Beach. The homes will be 4 bedrooms and 4 bathrooms with approximately 4,200 square feet of living space. There will also be an additional 1,400 square feet of lanai space. Each residence has its own private pool. There is a laundry list of additional amenities offered with each of these spectacular properties. One of the four listings is under contract. The remaining three properties are offered for $10,250,000 through Makena Wailea Real Estate. The Maui Real Estate Team may represent interested parties as their buyer’s agents.
The second new development to come to market this year was the Ridge at Wailea. This is a vacant land offering with homes sites up near the Hotel Wailea. Pricing ranges from $1,550,000 to $2,800,000 for the 9 lots that are roughly a half acre in size. This development is being represented by Wailea Realty. The Maui Real Estate Team can represent interested parties as their buyer’s agent. It will be interesting to see how well this development is received by the market. The last land offering in this range was the Bluffs at Wailea. That development came out during the market doldrums of the last real estate downturn and was not well received by buyers. That land is now going to be developed as condos (more on that below).
There is the possibility of one additional land offering hitting the market this year. A second phase of Wailea Golf Estates is planned and that would include 16 additional luxury home sites. The time frame to go to market has yet to be announced.
There is at least one condo development that should hit the market this year as well. Keala O Wailea will consist of 70 condos spread over 7 three story buildings. It will be built next to the Wailea Gateway Center at the site of the aforementioned Bluffs at Wailea. The 70 condos will include 4 floor plans ranging in size from 1196 square feet to 1510 square feet. The top floor penthouse suites will be the largest units. The Keala O Wailea will prohibit vacation rentals. The community will have a nice pool area and should have big views from that location. Pricing for the development has not been announced, but it has been suggested that the prices will be “affordable for Wailea.” To be clear, that doesn’t mean affordable housing by any standard definition, but we should see starting prices under $1,000,000. Additional information on the development and sales reservations should be coming some time around the middle of this year. As with any new development on Maui, it is not out of the realm that those dates could be pushed back. If the pricing holds true to what has been insinuated, I would expect Keala O Wailea will receive strong interest from buyers.
Makali’i at Wailea is a condominium development that is scheduled to be built across from the Fairmont Kea Lani Hotel in Wailea. This complex is supposed to go to market in the last quarter of 2014 with construction planned to start in 2015 and run through 2017. Preliminary plans for Makali’i call for 68 units spread over 17 buildings of four units each. The condos will feature a modern design with a lot of glass. I saw the preliminary sketches for the condos and they will be very unique from the current inventory in Wailea. It is expected that there will be two and three bedroom floor plans with roughly 1,500 to 1,700 square feet of living space. The condos should have excellent views. The community will have a pool and club house area for residents. Makali’i will also prohibit vacation rentals. I haven’t heard anything regarding the pricing for the condos, but I would expect that they will be at a higher price point than anything at Keala O Wailea.
The impact of the new developments on the Wailea and Makena markets will be interesting to watch. I have found that activity at new developments may mean slower activity at comparable existing condos. I would think places like Kanani Wailea, higher priced units at Wailea Fairway Villas and potentially Kai Malu could be impacted by a place like Keala O Wailea. We may see an overall decrease in sales volume as the new condo developments will be unlikely to see units close until construction is complete.
Contact The Maui Real Estate Team if you are interested in buying or selling property in the Wailea and Makena area. The Maui Real Estate Team would welcome the opportunity to sit down for a free consultation. You can also search the current inventory of Makena and Wailea Condos for Sale and Makena and Wailea Homes for Sale on MauiRealEstate.com.