Tag: Lai Loa at Wailea Hills
Maui Real Estate Blog
Maui Market Musings Volume XVII
This is our seventeenth Maui Market Musings. This edition continues to focus on the metrics that give us the best indication of current market conditions. Those three metrics are inventory, price reductions and how quickly properties are going under contract. Discretion was the better part of valor and I am going to hold off on my Kapalua market update for either the next musings or a stand alone post. I imagine people have more to do over the holiday weekend than reading a 3,500 word manuscript on the Maui Real Estate Market. Without further ado…
End of Month Inventory of Maui Single Family Homes
|$750,000-$999,999||32||63||25||62||31 (+6)||44 (-18)|
|$1,000,000-$1,499,999||43||37||65||34||58 (-7)||28 (-6)|
|$1,500,000-$1,999,999||44||22||41||19||46 (+5)||13 (-6)|
|$2,000,000-$2,999,999||34||15||31||19||36 (+5)||12 (-7)|
|$3,000,000-$4.999,999||27||10||25||9||32 (+7)||11 (+2)|
|$5,000,000-$9,999,999||23||8||24||7||26 (+2)||5 (-2)|
|Totals||241||169||239||156||256 (+17)||124 (-32)|
|Haiku||20||13||22||11||20 (-2)||7 (-4)|
|Hana||4||2||4||1||8 (+4)||2 (+1)|
|Kahului||8||27||13||21||11 (-2)||25 (+4)|
|Kihei||45||22||48||14||44 (-4)||16 (+2)|
|Kula||25||13||19||16||24 (+4)||10 (-6)|
|Lahaina||20||18||18||14||23 (+5)||7 (-7)|
|Makawao||13||12||14||9||15 (+1)||11 (+2)|
|Napili/Kahana/Hono…||12||3||10||6||14 (+4)||4 (-2)|
|Pukalani||12||7||7||6||8 (+1)||5 (-1)|
|Spreckelsville/Paia||11||2||10||2||15 (+5)||3 (+1)|
|Wailea/Makena||13||4||15||5||16 (+1)||4 (-1)|
|Wailuku||39||33||39||35||41 (+2)||22 (-13)|
End of August Home Inventory Review
The information above is provided with the usual framework. The home inventory data by price point includes all of the island of Maui, but excludes the islands of Molokai and Lanai. The district information is limited to the districts with the most activity.
- The inventory of active home listings on Maui actually increased approximately 7% since the last day of July. This comes on the heels of a decrease in active listings in July.
- Active inventory decreased in only two price ranges.
- Pending sales dipped again. Pending listings are 21% lower than the end of July and 27% below the end of June.
- Pending sales increased in only the $3,000,000 to $4,999,999 price range.
- Looking at the different price ranges, the $750,000-$999,999 price point stands out. Through the market boom of the last couple of years, you could make an argument that this was among the most competitive price points. Needless to say, this is a very different market now. The increase in interest rates reduced affordability for local buyers, and many investors seem to be sitting on the sidelines. As of today, 56% of the active listings in the range reduced their asking price at least once. Sellers are needing to adjust their price to the new realities of the market.
- Looking at the different communities around the island, the month to month shifts in the trajectory of inventory are notable. A number of places where inventory increased between June and July, decreased between July and August and vice versa. I would suspect we might continue to see this pattern moving forward.
- Kihei home inventory is notable for it’s month to month decrease after steady and significant growth in active listings over the previous months.
- Resort market inventory saw limited changes in active inventory. Ka’anapali and Kapalua both have one fewer active listings while Wailea has one more.
End of August Maui Condo Inventory
|$250,000-$499,999||19||25||11||23||14 (+3)||17 (-6)|
|$500,000-$749,999||31||40||43||39||34 (-9)||43 (+4)|
|$1,500,000-$1,999,999||28||34||30||33||24 (-6)||35 (+2)|
|$2,000,000-$2,999,999||20||36||20||36||22 (+2)||38 (+2)|
|$5,000,000-$9,999,999||11||3||10||3||8 (-2)||1 (-2)|
|Totals||199||247||205||234||181 (-24)||233 (-1)|
|Ka’anapali||23||15||24||13||25 (+1)||16 (+3)|
|Kahului||4||3||2||8||3 (+1)||7 (-1)|
|Kapalua||12||9||10||10||11 (+1)||6 (-4)|
|Kihei||55||74||67||60||50 (-17)||63 (+3)|
|Lahaina||16||5||16||8||9 (-7)||10 (+2)|
|Napili/Kahana/Hono||48||34||40||34||45 (+5)||25 (-9)|
|Wailea||23||85||25||82||24 (-1)||86 (+4)|
|Wailuku||12||12||14||13||9 (-5)||14 (+1)|
End of August Condo Inventory Review
Again, the tables above come with the usual framework for our end of month inventory. The table by price point includes all condos on Maui, but it does not include condos on the islands of Molokai or Lanai. The table with districts is limited to the communities with the most activity. Pending sales at La’i Loa at Wailea Hills skew the data in Wailea and the $1,500,000-$5,000,000 price ranges. There are 75 pending sales in that development based on contracts penned in 2020 and the first quarter of 2021. Pending sales in La’i Loa won’t start to close until sometime in 2023. Paradise Ridge Estates in Kihei also skews the data albeit to a lesser extent. There are 18 pending sales with that development based on contracts penned between 2018 and the first quarter of 2022. Those should start closing in the not too distant future.
- After steadily increasing over the last few months, active condo listings at the end of August dropped 12% from the end of July.
- Pending condo sales were virtually unchanged with only one fewer pending sale at the end of August compared to the end of July.
- Looking at the data by price range, active inventory only increased between $250,000-$499,000 and between $2,000,000 and $2,999,999. The biggest drops in active inventory occurred between $500,000 and $999,999 followed by $1,500,000 to $1,999,999.
- Kihei continues to be one of the more dynamic communities when it comes to inventory. Much like Kihei Home inventory, Kihei Condo inventory dropped significantly since the end of July. That comes on the heels of seeing the largest increase over the months prior. Pendings increased as well. Without doing a really thorough comparison of the month to month inventory, it’s hard to say if this is variability or sellers adjusting their pricing and buyers responding.
- The Napili, Kahana and Honokowai condo inventory took the opposite trajectory from Kihei with pending sales dipping substantially and active listings increasing on the month.
- The change between the end of the month active inventory in the resort markets was nominal. Wailea’s active inventory increased by 1 and both Kapalua and Ka’anapali decreased by 1. Pendings increased in both Ka’anapali and Wailea while the Kapalua pending sales dipped.
One final thing worth noting about home and condo inventory, September 1 marks something of a seasonal shift on Maui. Labor day is the end of our summer tourist season. Traditionally, real estate activity on island slows a little in the early fall. This is a time when some sellers take a break from the market. Eleven home and condo listings either cancelled or expired on September 1 after the numbers for the charts above were compiled. We also tend to see a little less in the way of new inventory. One would think that would be the case this year, but there are fewer certainties in this day and age.
Checking in On Price Reductions
Nationally, there is some discussions of price reductions starting to level off after steady growth over the last few months? What about Maui? Looking at the inventory as of September 2nd, 42.97% of all active home listings reduced their price one or more times. On August 15th, 39.67% of active homes reduced their price. On July 4th, that number stood at 34.03%.
In the condo market, 27.84% of all active listings reduced their price. That is actually a decrease from 29.62% on August 15th. For further context, 24.63% of the active condo listings had a reduced asking price on July 4th.
It’s worth noting, that some parts of the market have more price reductions than other. There is a fair amount of variability in the market by district and price point. One example being homes in the $750,000-$999,999 price range which I mentioned earlier.
How Quickly Are Things Going Under Contract?
Another metric that gives a pretty good sense of current demand and market conditions is the rate at which properties go under contract. Specifically, we look at what percentage of properties go under contract in ten days or less. We started tracking this in February when market conditions were particularly frenzied. At the time, 56% of all properties went under contract within 10 days. Of the listings that came to market between August 10th and August 17th, 29.79% went under contract within 10 days. That’s actually up a little from the last period we tracked between July 25th and August 1st when 22.45% went under contract within 10 days or less of coming to market.
Looking specifically at homes, 30.43% of the new listings between August 10th and 17th went under contract in 10 days or less. For comparison’s sake, between August 10-17, 2021, 50% of new inventory went under contract in 10 days or less. For a pre-covid reference point, it was 15.15% of new home listings between August 10th – August 17th, 2019 . I do want to mention that this seems to be an anomalously low week. Other recent 2019 comparisons came in around 25%.
For condos, 29.17% of the new listings between August 10th and August 17th went under contract in ten days or less. During the same time span of 2021 and 2019 respectively, the numbers came in at 58.33% and 30.43%.
Overall, we are well below last year’s frenzy. While we may have fewer buyers and sellers, the overall absorption of new properties is similar to what we experienced before Covid.
One other variable relevant to market conditions is interest rates. Recent movement in the bond market pushed interest rates on the 30 year fixed mortgage back up over 6%. This is the first time mortgages hit that rate since June. From recent discussions with mortgage brokers, many borrowers are opting for 10 year ARMs to lower monthly payments. That said, regardless of the mortgage product borrowing costs are significantly higher now than they were 12 or even 6 months ago. That is going to have a big impact on affordability.
Some Musings Eye Candy From Maui’s Sandy Shores
Contact The Maui Real Estate Team
Questions, comments or feedback? Contact The Maui Real Estate Team to discuss the latest market musings or if you need assistance buying or selling Maui Real Estate. Our experienced team of agents is well suited to assist buyers and sellers in the current dynamic market conditions. We look forward to hearing from you and discussing your real estate needs.
Maui Real Estate Blog
Maui Market Musings Volume XIII
It’s the beginning of a new month and the end of the first half of the year. Milestones like that typically call for a look back at first half of the year stats. That said, the market in the first quarter of the year is a lot different than the market now. While we intend to look at the June sales numbers in the next musings, the focus of this edition is on statistics that are more relevant to current conditions. The three main statistics reviewed in Volume XIII include inventory, price reductions and the number of properties going under contract within ten days of coming to market.
Inventory Watch for Single Family Homes
At the end of May, we started documenting end of month inventory for different communities and price points. We did it again on the last day of June. The intent is to track inventory at a more granular level than the island wide inventory statistics released by the local Realtor’s Association.
|May 31, 2022||June 30, 2022|
|$750,000-$999,999||19||54||32 (+13)||63 (+9)|
|$1,000,000-$1,499,999||43||37||58 (+15)||34 (-3)|
|$1,500,000-$1,999,999||30||27||44 (+14)||22 (-5)|
|$2,000,000-$2,999,999||37||14||34 (-3)||15 (+1)|
|$3,000,000-$4.999,999||24||11||27 (+3)||10 (-1)|
|$10,000,000-$19,999,999||9||2||13 (+4)||0 (-2)|
|Totals||193||176||241 (+48)||169 (-7)|
|May 31, 2022||June 30, 2022|
|Haiku||15||12||20 (+5)||13 (+1)|
|Hana||5||3||4 (-1)||2 (-1)|
|Ka’anapali||13||6||11 (-2)||7 (+1)|
|Kahului||11||24||8 (-3)||27 (+3)|
|Kapalua||4||2||5 (+1)||3 (+1)|
|Kihei||27||25||45 (+18)||22 (-3)|
|Kula||24||12||25 (+1)||13 (+1)|
|Makawao||11||17||13 (+2)||12 (-5)|
|Pukalani||5||12||12 (+7)||7 (-5)|
|Spreckelsville /Paia||12||4||11 (-1)||2 (-2)|
|Wailea/Makena||8||5||13 (+5)||4 (-1)|
|Wailuku||28||32||39 (+11)||33 (+1)|
End of June Home Inventory Overview
Here are a couple of quick notes about the data above to provide some framework. The price ranges cover all of Maui. They do not include the islands of Lanai or Molokai. The list of districts above is limited to those with the most activity.
- The overall trends on inventory are pretty clear with just under a 25% increase in active listings and a 4% drop in pending sales over the last month. A substantial spike in interest rates provided the backdrop for this shift in active and pending sales.
- Honing in on various price points, you can see a little more variability in the market.
- Active inventory below $750,000 remained unchanged while pending sales decreased.
- When you bump up to the $750,000-$999,999 range, inventory increases are substantial, but it is also the price range with the largest increase in pending sales activity.
- The $1,000,000-$2,000,000 range saw a significant increase in active listings with a drop in pending sales activity.
- The luxury home market experienced more modest increases in inventory and the decline in pending sales is less significant.
- The variability in numbers at a district level is a little more of a head scratcher.
- Kihei inventory grew the most with a 66% increase in active homes for sale.
- Neighboring communities saw different trajectories in inventory. Kahului’s inventory fell while the number of active homes in Wailuku grew almost 40%.
- Within the luxury markets, Wailea and Makena experienced a pretty healthy bump in inventory. Kapalua has one more active home listing while active inventory in Ka’anapali is down.
Inventory Watch for Condos
|May 31, 2022||June 30, 2022|
|<$250,000||5||9||2 (-3)||8 (-1)|
|$250,000-$499,999||12||23||19 (+7)||25 (+2)|
|$500,000-$749,999||18||55||31 (+13)||40 (-15)|
|$750,000-$999,999||29||54||44 (+15)||46 (-8)|
|$1,000,000-$1,499,999||23||49||29 (+6)||30 (-19)|
|$2,000,000-$2,999,999||19||40||20 (+1)||36 (-4)|
|$3,000,000-$4,999,999||12||22||11 (+1)||25 (+3)|
|$5,000,000-$9,999,999||7||7||11 (+4)||3 (-1)|
|Totals||149||293||199 (+50)||247 (-46)|
|May 31, 2022||June 30, 2022|
|Kahului||5||8||4 (+1)||3 (-5)|
|Kapalua||7||15||12 (+5)||9 (-6)|
|Kihei||35||95||55 (+20)||74 (-21)|
|Lahaina||14||8||16 (+2)||5 (-3)|
|Napili/Kahana/Hono…||34||39||48 (+14)||34 (-5)|
|Wailea||16||91||23 (+7)||85 (-6)|
|Wailuku||9||11||12 (+3)||12 (+1)|
End of June Maui Condo Inventory Overview
As with the home market, the price points table includes all condos on Maui, but it does not include condos on Molokai or Lanai. The table with districts is limited to the districts with the most activity. As mentioned in the last Musings, pending sales at La’i Loa at Wailea Hills skew the data in Wailea and the $1,500,000-$5,000,000 price ranges. There are 75 pending sales in that development based on contracts penned in 2020 and the first quarter of 2021. Those pending sales won’t start to close until sometime in 2023.
- The increase in condo inventory between May and June is more pronounced with a 33% jump in active condo listings. Pending condo sales dropped 16%.
- Honing in on the different price points, all price ranges with the exception of condos priced below $250,000 experienced an increase in active inventory.
- The biggest increase occurred in the $500,000 to $749,999 price range.
- On the pending sales front, all but three price ranges had a decrease. The $250,000 to $499,999 price range saw a modest increase. The number of pending condos sales stayed the same from $1,500,000 to $1,999,999. The $10,000,000 plus condo market remained unchanged with no pending listings.
- Looking at inventory from a district level, active inventory increased in all communities except for Ka’anapali.
- Ka’anapali condos are the outlier when it comes to resort condo inventory. Kapalua inventory increased 71% and Wailea inventory increased 44%. It is worth noting these increases are coming from near historic lows in inventory. That 71% increase in condo inventory in Kapalua is due to just 5 more listings.
- Other notable increases in inventory occurred in the markets that were the busiest earlier this year. Kihei active condo inventory increased 57%. Napili, Kahana and Honokowai active listings increased 41%.
As of July 4th, 34.03% of all active home listings on Maui reduced their asking price one or more times. That compares to 33% on May 24th and 29.5% on June 7th. After seeing a small dip in price reductions in early June, those numbers appear to be rising again.
For condos, 24.63% of all active condo listings reduced their price one or more time. The increase in price reductions is steady. The percentage of active listings that reduced price was 18.2% and 20.9% on May 24th and June 7th respectively.
It’s important to note that the higher number of price reductions isn’t indicative of decreasing values at this point in time. In many cases, this is sellers who priced ambitiously adjusting to the realities of a shifting market.
Market Response to New Listings
Another metric that we’ve tracked in our market musings is the percentage of new listings going under contract within 10 days. We started to track this in mid February, a time period when competition for inventory remained incredibly strong. At that time, 56% of all new listings were under contract within 10 days. As posted in Musings XI, that number dipped to 35.54% for the period between May 18th and May 25th. For the period between June 14th and June 21st, the number dropped to 25.37%.
While the number above shows a pretty significant cooling of the market, context is key. Between June 14th and June 21st of 2019, only 17.28% of all listings went under contract within the first ten days of coming to market. There are still buyers out there acting quickly when well priced properties come to market.
Takeaways for Buyers and Sellers
When interest rates spiked over 6% in early June, the hyperbolic takes on the real estate market came fast and furious. The crowing of the bubble watchers became deafening. In places like Boise and Phoenix, it looks like there may be some drastic shifts in the market. That said, what’s true for Boise may not be true for Maui. Our goal is to strip out the hype so buyers and sellers can make informed decisions.
To be clear, the Maui Market continues to cool down from the frenzied market of earlier this year. While inventory is growing, the growth in inventory started later than most markets on the mainland. We are still seeing inventory levels well below normal. While pending sales are decreasing, the percentage of properties going under contract in ten days or less is higher than during the same period of 2019. As the numbers above show, market conditions are showing variability based on location and price points. Where you are buying or selling in the market will impact your experience.
Buyers shopping in most price points will appreciate the increased inventory compared to the scarcity of earlier this year. While competition is down, well priced properties may still see bidding wars. This is particularly true at the lower priced points of the market where inventory remains truly scarce.
Prospective sellers will want to look closely at conditions specific to their price point and community when pricing their property. In those areas where inventory is growing the most and demand is shrinking, you will want to be particularly mindful of not overpricing your property. Sales will likely take longer. With buyers largely moving out of the FOMO mentality, a little give and take may be necessary to get deals done.
Some Maui Beauty to Brighten This Post
Contact The Maui Real Estate Team
Questions about the market or this post? Thinking of buying or selling? Contact The Maui Real Estate Team. We look forward to being of assistance.
Maui Real Estate Blog
Maui Real Estate Musings Volume XII
The latest edition of Maui Real Estate Musings is coming from the road. While I may be on the mainland, I still have an eye and ear on the Maui Real Estate Market. Volume XII addresses the elephant in the room from last week’s real estate news. As promised in Musings XI, there is also a review of end of May inventory numbers by district and price point. Finally, we take a quick look at the percentage of active home and condo inventory with price reductions. Without further ado, and so I can get back to hanging out with the in-laws, here is musings volume XII.
The Elephant in The Room
The elephant in the room of course is interest rates. Interest rates on the 30 year fixed mortgage spiked to over 6.2 percent last week. Stronger than expected inflation numbers for May and the resulting anticipation of sharper increases in the Federal Funds rate fueled a strong spike in mortgage rates. This is a significant difference in borrowing costs from interest rates below 3% a year ago.
Prior rate increases this year pushed some buyers out of the market. Needless to say, it is likely that this recent rate increase will further thin the pool of financed buyers. Those that do stay in the market, will be able to afford less home. It is possible that we see a brief uptick in activity in the market as buyers who locked in lower rates feel heightened urgency to purchase. Conversely, the shift in rates may cause a more immediate slow down in demand. We shall see how it plays out.
Of course, the smaller pool of buyers and less purchasing power from financed buyers will cause other impacts to the market. Lesser demand will likely lead to growing inventory. Keep in mind, we are still experiencing inventory numbers well below normal. How quickly and how much inventory grows is something of an unknown. The other thing we are likely to see is price reductions. A lot of sellers on the market initially entered the market at prices that assumed continued rapid appreciation. With less demand and less competition, many sellers will need to adjust expectations and pricing.
End of May Inventory Levels
The Realtors Association of Maui tracks end of month inventory levels island wide for homes and condos. We report on those numbers regularly. I took it a step further documenting inventory levels by district and price point on the island. The numbers are meant to serve as a baseline for future comparisons. It is a means to track changes in inventory among different market segments. That said, there is some interesting information to be gleaned from just the May numbers. They show some of the recent variability in inventory levels and market conditions based on both geography and price point.
End of May Home Inventory
End of May Home Inventory by Price Point
End of May Home Inventory Takeaways
- Kahului has the lowest ratio of active listings to pending listings with 11 active listings compared to 24 pendings.
- Kula and Paia have the highest ratio of active home listings to pending sales.
- The ratio of pending sales to active sales is higher in districts with more lower priced options and less second home activity. There is stronger demand and more competition for lower priced primary residences.
- The ratio of pending listings to active listings by price point corroborates the point above. The number of active listings is a small fraction of the pending listings below $1,000,000. There are no homes in the resort markets below $1,000,000.
- With the exception of the $1,500,000 to $1,999,999 range, the higher you go in price point, the the ratio of active listings to pending sales increases.
- While the resort communities have more active listings than pending sales, the inventory in these communities remains limited.
- The same can be said for higher price points. With the exception of the highest price points, inventory is still well below normal in the $2,000,000 to $5,000,000 range.
End of May Condo Inventory by District
End of May Condo Inventory by Price Point
End of May Condo Inventory Takeaways
- First things first, there is an important thing to note in the pending condo numbers. They include 75 pending sales in La’i Loa at Wailea Hills. This development is under construction and the bulk of the contracts were signed in the second half of 2020 and the first quarter of 2021. These pending sales skew the numbers for Wailea and the price points between $1,500,000 and $4,999,999.
- The Kihei Condo market numbers reflect its frenzied state over the last 12 months. This includes both vacation rental and non-vacation rental properties. Supply appears to be well below demand.
- The price points between $500,000 and $1,500,000 have the highest ratio of pending sales to active listings.
- The $5,000,000 to $9,000,000 range shows a lot less active inventory vs recent demand compared to the single family homes in this range.
- Lahaina is notable as the only district with more active condo listings than pending listings.
- Overall, the condo market inventory numbers reflect more scarcity and higher activity across the board than the home market.
A Few Final Thoughts on the Inventory Numbers
This data is lagging behind a few weeks at this point. I will be posting the numbers for the end of this month shortly after the first of July. I suspect we will see increases in inventory across a number of districts and price points. Another “flaw” to this analysis is that it lacks a baseline of comparison to historical numbers. Unfortunately, old Realtors Association of Maui statistics track monthly sales and not active inventory. I wish we had a “normal” number for districts and price points. I am going to need to rely on anecdotal observations as to what seems normal for active listings.
I did want to look at one statistics that gives more of a current look at market conditions. Price reductions give us some sense of demand and how sellers are currently responding to shifts in demand. As of June 22nd, 32.4% of active home listings reduced their price. That is up from 29.5% on June 7th. It is still a little below May 24th when 33% of all active home listings reduced below listing price. For condos, 22.5% of the active inventory reduced their price as of June 22nd. That is up from June 7th and May 24th when 20.9% and 18.2% of the active inventory reduced prices respectively.
Some Maui Beauty To Brighten Your Day
This week’s beautiful Maui tweet comes with a bonus link to an article on South Maui Summer Activities.
Wrapping Things Up
It’s clear that market conditions are changing. A few quick final thoughts for sellers and buyers. Sellers, it is pretty clear the market is a lot different than it was 6 months or even 3 months ago. If your list prices were aspirational, price adjustments may be necessary to get in line with the market. Less competition means less leverage when it comes to negotiations. For buyers, the reverse is true and you may start to have an opportunity to negotiate. There is more opportunity for due diligence and there may be some more choice available to you. The trade off for financed buyers is more purchasing power.
With changing market conditions, quality representation remains as important as ever. Contact The Maui Real Estate Team to discuss your real estate needs. We look forward to being of assistance.