We are starting off 2023 with volume 22 of our market musings. Early January means that we are in the beginning of what is traditionally our peak real estate season on Maui. This post helps to give a sense of recent market demand and current inventory levels as we enter into what should be the busiest 3-4 months of the year for real estate transactions on island.

December Market Activity

We start things off by taking a look back at December. How many new listings came to market, went under contract and sold? Activity from the five previous Decembers are given for additional context.

	12/22	12/21	12/20	12/19	12/18	12/17
Homes	89	98	115	121	120	140
Condos	76	162	152	143	173	173

New inventory during the month of December was below normal. The number of new listings is anywhere between 25% and 36% lower than what we would anticipate in the pre-Covid Decembers of 2017-2019. This December’s home inventory benefited from an influx of new listings in the Hoku’ula subdivision in Upcountry Maui towards the end of the month. Were it not for those 19 listings, new inventory would be even further below what’s considered normal.

New condo inventory was significantly lower than usual in December. It is anywhere between 47% and 56% below the December new inventory of 2017-2019. Whether it’s the golden handcuffs of low interest rates, the lack of potential replacement properties or just loving their place on Maui, people are holding on to their condos for now.

	12/22	12/21	12/20	12/19	12/18	12/17
Homes	51	69	117	74	75	75
Condos	53	136	139	113	110	108

While new inventory was low, buyer demand also remained low in December. The number of new pending home sales came in at anywhere between 32-33% below what we saw in the three years prior to the start of Covid.

New Pending condo sales came in between 45% and 52% below the activity seen over the years prior to Covid. The slow down in new condo inventory and sales activity is particularly pronounced over the last few months.

	12/22	12/21	12/20	12/19	12/18	12/17
Homes	64	113	106	96	91	89
Condos	67	171	170	125	122	140

The closed transactions in December give us some insight to market demand a little earlier in the fall. Most of these closes came out of contracts agreed to in October and November. Home sales were between 28 and 33% lower than a typical Pre-Covid December. Condo sales in December are between 45 and 53% lower than the three Decembers prior to the start of Covid. Of course, this December’s home and condo sales are way below 2020 and 2021 sales volume.

End of December Maui Inventory

Inventory, or lack thereof, continues to be a significant factor in our market. While new inventory remains low, quieter buyer activity over the last 2-3 months allowed for modest growth in the overall number of properties for sale. That said, we still have a lot less inventory that what was more typical pre-Covid. The charts below provide detail on active and pending listings by price point and community.

End of December Home Inventory

	10/31/2022		11/30/2022		12/31/2022
	Active	Pending	Active	Pending	Active	Pending
<$750,000	9	15	5	14	6 (+1)	10 (-4)
$750,000-$999,999	29	29	31	25	25 (-6)	28 (+3)
$1,000,000-$1,499,999	64	28	61	28	78 (+17)	20 (-8)
$1,500,000-$1,999,999	41	13	28	17	36 (+8)	11 (-6)
$2,000,000-$2,999,999	35	10	34	11	37 (+3)	12 (-1)
$3,000,000-$4,999,999	32	7	32	7	31 (-1)	9 (+2)
$5,000,000-$9,999,999	26	5	23	9	27 (+4)	8 (-1)
$10,000,000-$19,999,999	9	0	14	0	14	0
$20,000,000+	3	1	5	1	4 (-1)	2 (+1)
Totals	248	108	233	112	258 (+25)	100 (-12)

	10/31/2022		11/30/2022		12/31/2022
	Active	Pending	Active	Pending	Active	Pending
Haiku	28	9	29	10	29	7 (-3)
Hana	10	0	10	0	10	1 (+1)
Ka’anapali	7	2	9	2	9	3 (+1)
Kahului	16	16	16	13	16	13
Kapalua	6	0	5	3	5	3
Kihei	40	11	31	15	39 (+8)	7 (-8)
Kula	20	11	22	12	21 (-1)	10 (-2)
Lahaina	22	13	15	13	18 (+3)	11 (-2)
Makawao	13	9	11	7	35 (+24)	4 (-3)
Napili/Kahana/Honokowai	11	6	9	3	13 (+2)	3 (-3)
Pukalani	8	3	10	3	7 (-3)	3
Sprecks/Paia	8	2	7	3	9 (+2)	1 (-2)
Wailea	11	4	16	4	13 (-3)	6 (+2)
Wailuku	40	21	32	19	25 (-7)	25 (+6)

Notable Numbers from the End of December Home Inventory

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 and communities with the most activity.

• For the second month in a row, the inventory of active home listings increased on Maui. Active inventory increased 10.7%. A good portion of the bump in inventory can be traced to the 19 new developer listings in the Hoku’ula subdivision.
• Changes in active inventory varied by price point. Five price points increased in inventory, three decreased and one was unchanged. The price range with the biggest increase in inventory was between $1,000,000 and $2,000,000. Again, that was largely due to Hoku’ula. It was notable that the $750,000-$999,999 price range saw the biggest drop in active listings from the month prior. Inventory in that segment increased steadily in the the previous three months. With a higher percentage of financed buyers in this price point, the spike in interest rates earlier in the fall curtailed buyer demand.
• Overall Pending home inventory decreased from the end of November. The number of pending homes dipped 10.71% between November 30th and December 31st.
• By price point, pending sales increased in three price ranges, decreased in five and remained unchanged in three price points. The biggest increase in pending sales occurred in the $750,000-$999,999 range. Perhaps recent decreases in interest rates provided some relief to buyers in that price range. The biggest decrease in pending sales occurred in the $1,000,000-$2,000,000 price range.
• At a community level, inventory trends continued to vary. Inventory increased in 5 communities, decreased in 4 and remained unchanged in 5 districts. The biggest increase by far was in Makawao (the Hoku’ula effect) followed by Kihei. Wailuku inventory decreased the most.
• Pending sales decreased in most communities. Kihei pending sales decreased the most month to month. Wailuku experienced the biggest increase in pending sales.

End of December Maui Condo Inventory

	10/31/2022		11/30/2022		12/31/2022
	Active	Pending	Active	Pending	Active	Pending
<$250,000	2	4	1	4	2 (+1)	2 (-2)
$250,000-$499,999	19	12	19	14	12 (-7)	16 (+2)
$500,000-$749,999	32	35	43	33	38 (-5)	25 (-8)
$750,000-$999,999	27	27	28	29	42 (+14)	27 (-2)
$1,000,000-$1,499,999	21	30	31	24	32 (+1)	21 (-1)
$1,500,000-$1,999,999	14	33	21	28	26 (+5)	29 (+1)
$2,000,000-$2,999,999	15	40	18	39	18	36 (-3)
$3,000,000-$4,999,999	10	17	11	17	10 (-1)	18 (+1)
$5,000,000-$9,999,999	11	1	12	2	14 (+2)	0 (-2)
$10,000,000+	3	1	3	0	4 (+1)	0
Total	154	200	187	190	198 (+11)	174 (-16)

	10/31/2022		11/30/2022		12/31/2022
	Active	Pending	Active	Pending	Active	Pending
Ka’anapali	18	9	25	4	22 (-3)	9 (+5)
Kahului	5	5	5	5	4 (-1)	3 (-2)
Kapalua	12	4	14	2	12 (-2)	3 (+1)
Kihei	43	60	53	61	61 (+8)	45 (-16)
Lahaina	8	4	14	8	11 (-3)	12 (+4)
Ma’alaea	3	6	4	8	5 (+1)	5 (-3)
Napili/Kahana/Honokowai	33	17	39	19	50 (+11)	16 (-3)
Wailea/Makena	19	85	23	85	27 (+4)	79 (-6)
Wailuku	11	10	8	8	4 (-4)	4 (-4)

Notable Numbers from the End of December Condo Inventory

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 the fall of 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. Overall, 53.44% of the current pending condo inventory is in La’i Loa or Paradise Ridge Estates.

• For the third straight month, end of month inventory of active condo listings grew. It increased 5.88% from the end of November.
• Looking at the inventory by price point, there continues to be a lot of variability. While most price points saw modest changes, the inventory of $250,000-$749,999 condos decreased by a decent margin. The inventory of condos priced between $750,000 and $999,999 increased substantially. There was also a bump in inventory between $1,500,000 and $1,999,999.
• End of the month pending condo sales dropped for the third straight time. Pending sales dropped 8.43%.
• Most price ranges saw a decrease in pending sales by the end of the month. The $500,000-$749,999 price range saw the biggest drop in activity followed by the $2,000,000-$2,999,999 price point.
• At a community level, most locations saw modest changes in inventory. There were exceptions. Kihei and the Napili, Kahana and Honokowai MLS district saw pretty big increases. Ka’anapali and Wailuku both saw notable decreases in inventory.
• Most communities saw a decrease in pending sales by the end of December. Kihei saw the biggest decrease in pending sales. While Wailea’s decrease was smaller, it is notable that the vast majority of the remaining pending sales are longer term contracts at La’i Loa. Only 4 of the 79 pendings in Wailea at the end of the month were condos outside of that development.
• The West Maui communities of Ka’anapali and Lahaina were both notable for their increase in pending condo sales.

How Quickly Are Things Going Under Contract

We started tracking the percentage of properties going under contract in ten days or less all the way back in February. At the time, the market was in a frenzy and 56% of all new listings went under contract within that first ten days of coming to market. We’ve seen things slow considerably since that time. I took a look at properties that came to market between December 13th and December 20th. Of the 35 listings that came to market, 25.71% went under contract within the first ten days. That is actually up from when we last checked in November when only 15.9% of all properties went under contract.

Looking specifically at homes, 20% of the homes listed between December 13 and 20th went under contract within 10 days or less. Last year during the same period, 15.38% of new home listings went under contract in 10 days or less. In 2019, 20% of homes went under contract in 10 days or less.

Of the condos that came to market between December 13th and 20th, 30% went under contract within 10 days. For perspective, 41.51% of all condos listed between December 13-20th, 2021 went under contract in ten days or less. In 2019, 15.22% of condos listed during that same time period went under contract in 10 days or less.

My biggest takeaway from these numbers is that we are well off the frenzy of 2021 and the first quarter of 2022. Response to new listings is closer to what we had pre-Covid. Back then, quality properties priced well tended to go quickly. That continues to be the case today. Unless there is a lot of push back from the readership or we see a clear shift in market conditions, I am going to retire this metric from future musings posts.

Price Reductions

While market activity remained slow in December, it doesn’t seem to be fazing too many sellers. As of December 31st, only 33.33% of all active listings had one or more price reduction. That is down from 37.02% on November 30th and 39.92 on October 31st. It was all the way up at 42.21% in late September.

The condo market is seeing even fewer price reductions. As of New Year’s eve, only 25.25% of all active condo listings were reduced in price one or more times. That is down slightly from 25.53% on November 30th and 29.41% on October 31st.

I surmise that low inventory and seller hopes for a seasonal increase in buyers has led more seller to stick their guns on pricing.

Quick Thoughts On the Market as We Enter Maui Peak Buying Season

Needless to say, the trajectory of the market isn’t entirely clear at the start of buyer’s season. Inventory is up from last winter, but still well below normal. Demand is lower, but it should potentially increase just due to seasonality. Affordability is down significantly from this time last year, but there is still a lot of cash in our market and rates are better than they were earlier in the fall. Add it all together and it makes prognostication a challenge. About the only thing I feel comfortable predicting is continued variability in conditions by price range and by location around the island. We will continue to provide market observations as buyer season progresses on the blog.

A Little Maui Beauty

Contact The Maui Real Estate Team

With the uncertainty in the Maui Real Estate market, quality representation is more important now then ever. Contact the Maui Real Estate Team. Our experienced agents welcome the chance to discuss your real estate needs. We look forward to being of assistance.

Today’s blog looks towards leeward Haleakala and the beautiful beaches, stunning views, and high end amenities of the Wailea Resort. We wanted to take a look at how the Wailea market fared through the year to date. This post includes information on Wailea Home and Condo sales as of September 22, 2021. It is also worth noting that this looks exclusively at properties in the Wailea Resort itself. Our MLS groups Wailea and Makena together. I plan on doing a separate post on the Makena market some time next week.

Notable Number’s From This Year’s Wailea Home Sales

• As of September 22nd, Maui Realtors reported 41 home sales. That is a 227% increase in activity compared to the 18 that closed during the same period last year.
• The median price of the homes sold is $3,000,000. The average price is $3,691,505. That is an increase of 44% and 55% over last year’s median and average prices respectively.
• It is worth noting that the change in median and average sales price is not an accurate reflection of the year to year change in values. More sales at the highest reaches of the market helped to boost both of those numbers.
• The highest priced sale of the year to date in Wailea closed for $10,900,000. This Wailea Highlands property included a 6,042 square foot home on almost an acre of land.
• The Wailea Highlands close was one of two sales to close for more than $10,000,000 and one of six home sales to close for more than $5,000,000 in Wailea. There were no sales over $5,000,000 during the same period of 2020.
• The lowest priced sale closed for $1,350,000. This Wailea Pualani home offered 1,991 square feet of living space.
• Competition for homes increased significantly. Of the 41 sales, 11 sold for over asking price and 5 sold for full price. By comparison, none of the sales over the same period of 2020 sold for above asking price.
• More competition occurred at the lower price points of the Wailea home market. Eleven out of nineteen sales under $3,000,000 closed for asking price or above.
• Almost 66% percent of the transactions were reported to be cash sales. Cash seemed to be preferred in the more competitive $3,000,000 and under range and with higher priced transactions. A greater number of buyers chose to use conventional financing for the $3,000,000 to $5,000,000 price range.
• Wailea Pualani and Wailea Kai saw the most activity of all of the neighborhoods in Wailea. There were 8 closes in each subdivision.

Thoughts on Recent Activity and the Outlook for the Wailea Home Market

Needless to say, the numbers above point to a robust eight plus months of home sales in Wailea. While many second home markets took off in the spring and summer of 2020, Maui’s market remained relatively quiet due to quarantine requirements. We started to see an uptick in buyer activity after the governor lifted quarantine restrictions in October. Buyer activity started to increase during those last few months of 2020. It hit a whole other level in 2021. I checked the MLS data going back to 2003. Only January-September of 2005 came within 10% of this year’s total.

While this spring marked the peak of the frenzy, buyer demand remains strong. Inventory, on the other hand, is particularly limited. There are only eight active home listings for sale within the Wailea Resort. An additional seven homes are under contract. Barring any significant changes in the global economic picture or an unexpected influx of new listings, Wailea should remain a seller’s market through the rest of the year with sales volumes slowing due to the lack of inventory.

Notable Numbers From the 2021 Wailea Condo Market

• Maui Realtors reported 232 condos sold in Wailea between January 1, 2021 and September 22nd. That is a 362.5% increase over the 64 sold during the same period of 2020.
• The median price of the 232 condos sold is $1,398,000. The average price is $1,910,153. That is 15.3% and 12.2% higher than last year’s median and average respectively.
• The highest priced condo sale for the year to date closed for $14,000,000. This Wailea Beach Villas condo features 3 bedrooms, 3.5 bathrooms, almost 3,000 square feet of living space and a direct beachfront location.
• The lowest priced Wailea condo sale for the year to date closed for $647,000. This is a studio unit at Wailea Ekahi.
• I did a double take when looking at the data for the lowest priced condo sales in Wailea. I saw two closes at Wailea Point for $375,000 and $425,000 respectively. That is a shockingly low price for one of the more premium developments in Wailea. Closer examination revealed that the two seemingly low priced condo sales were for boat garages in the development.
• According to MLS statistics, Makali’i was the busiest condo for sales thus far this year. It is worth noting that the majority of the 47 closes were new developer sales. These new developer sales were based on pre-construction contracts penned two to three years ago.
• While closes at Makali’i juiced this year’s total sales volume based on older contracts, it is worth noting that quite a few properties went under contract in 2021 that won’t close until at least 2023. La’i Loa at Wailea Hills is the newest condo development in Wailea. Sales began in the spring of 2020. A roll out right at the start of Covid-19 blunted momentum. That said, it picked up steam in the fall of 2020. Strong demand in the first few months of 2021 resulted in the reservation of all 75 units by this spring.
• Maui Realtors reported the most resales at Wailea Ekahi and Grand Champions. Both developments stand at 25 sales for the year to date.
• Of the 232 sales, MLS records show 129 were cash transactions. That is 55.6% of the total sales. That is up from 47.9% over the same period last year.
• Competition also increased significantly in the Wailea condo market. Of all of the closed transactions, 35 closed for over asking price. Over the same period of 2020, not a single transaction closed for over asking price.

Thoughts on and Outlook for the Wailea Condo Market

Like the Wailea home market, the Wailea condo market experienced strong activity through the first nine months of the year. Also like the home market, the trajectory of the market showed a similar pattern over the last 18 months. It was a slower spring and summer of 2020 as the island felt the impacts of Covid-19 and a lack of visitors. A gradual ramping up of activity followed when tourism reopened in October. The start of the new year brought a whole other level of interest in Wailea Condos. We entered the year with a fairly balanced market between supply and demand. That shifted as buyers ravenously chewed through the market inventory. As with the home market, we are seeing all time high levels of sales activity for the year to date.

With high levels of demand and a shrinking supply, we also experienced a lot of upward price pressure in the market. With variability in value between units, it is hard to quantify the exact levels of appreciation. If I were to guess, I would saw 10% or greater appreciation is quite likely with variability between some of the different developments.

As for the outlook for the rest of the year, it really comes down to inventory. Plain and simple, the active condo inventory is shockingly low. At the date of this post, there are 6 active condo listings in all of the Wailea resort. There are active listings at only four of the seventeen condo developments within Wailea. Needless to say, this will constrain sales volume unless we see a considerable uptick in active inventory. It will also lead to some upward pricing pressure.

Contact The Maui Real Estate Team

Contact The Maui Real Estate Team if you are interested in buying property in Wailea. We would be happy to keep our eyes and ears open for new inventory or unlisted properties. You can also keep tabs on the current inventory of active Wailea Condo listings and Wailea Homes for Sale on MauiRealEstate.com. I don’t think you could find a much better time to go to market if you are a Wailea property owner thinking about selling. Send us a message or give us a call to arrange a free consultation and an estimate of the current market value of your condo.