Tag: One Palauea Bay
Maui Real Estate Blog
Four Listings for Your Christmas Wish List
Christmas is just a few days away. Still stumped on what to get the family or that special someone? While none of these suggestions will fit under the tree, maybe the keys would fit nicely in your Christmas stocking. Here are four of our listings that would make this a Christmas to truly remember.
For Those That Love The Ocean
If there is a certain someone in your life who loves the ocean and ocean sports, you would be hard pressed to find a better option on the market than Sugar Cove Building 6. This is the ultimate North Shore lifestyle property. This whole building in the Sugar Cove condominiums is located right above the golden sand of the beach. The beach is as good as it gets for water sports. Long considered a good spot for windsurfing, these days it is a hot spot for wing foiling, kiting, surfing, stand up paddling, body boarding and fishing. Our agent Ridge Lenny gives a taste of the lifestyle on offer in the video below.
While location may be the biggest amenity of Sugar Cove Building 6, the condo itself is a one of a kind offering. Originally three separate units, it was consolidated into one primary living space and a guest space. Overall, it includes eight bedrooms, seven bathrooms, three half bathrooms and a total of 5,950 square feet of living space. This other video highlights the quality design, materials and finishing.
The asking price for Sugar Cove Building 6 is $17,000,000. Contact The Maui Real Estate Team for more information.
For Those That Demand The Highest Quality
A Design Nerd’s Dream. Impeccable finishing. Precision Crafted. Carefully Curated. Just some of the ways that people describe the Oasis in Spreckelsville.
This immaculate property includes a 2 bedroom, 3 bathroom main home, a detached garage with second story studio apartment, a soaking tub, lap pool and a zero edge main pool. The construction is truly of the highest quality as are the fixtures and building materials. It is sold with furnishings and selected artwork. Again, all of these items carefully chosen by the owner with an attention to detail and quality rarely seen on Maui. Check out our previous posts on the Oasis, its outdoor spaces and design details. Offered for $9,800,000.
For Those That Want to Build The Best…
Five Star Location. A big lot of 1.88 acres. A gated subdivision with only one other vacant lot. Easy access to beautiful beaches and fantastic resort amenities. All of the above make 21 Ualei Place a truly tantalizing spot to build a spectacular luxury home. Located in the One Palauea subdivision, the lot is just to the south of the Fairmont Kealani. Palauea Beach, Polo Beach and the Wailea Beach Path are all a short minutes walk from the property. The Wailea Blue, Emerald and Gold golf courses are again all close by.
This lot is offered for $6,500,000. Check out the 21 Ualei Place listing page for more photos and details.
For Those That Want to Build Now!
Building takes time and patience. One of the biggest time sinks can be the permit process. That is particularly true when you are in a special management area close to the ocean. That makes 300 Mehana Unit B in Haiku the perfect spot if you want to build your dream cottage on Maui sooner rather than later. SMA approvals are done and the permits approved for a 1,000 square foot accessory farm dwelling (cottage), detached garage and agricultural workshop. The CPR property includes 4.22 acres of land. There is plenty of room for gardens or orchards. Set close to the ocean, you can hear the waves and smell the salt in the air. The ocean and Haleakala views are both fantastic.
Grab your builder and break ground in the new year. The asking price for 300 Mehana Unit B is $895,000. Check out the listing page for more photos and details.
Contact Your Favorite Maui Real Estate Elves
There you go! Four last minute gift ideas for the family or a special someone clearly not on the naughty list. Contact The Maui Real Estate Team for help with these properties or if you have something else in mind on your real estate holiday wish list. We look forward to being of service.
Maui Real Estate Blog
Maui Market Musings Volume XV
Welcome to the 15th edition of our market musings. The last musings was a little more of a backwards looking post as we reviewed notable numbers from the June Stats and took a deep dive into the land market during the first half of the year. This edition focuses on statistics that might be better suited to addressing current market conditions. We also take a longer look at the Wailea and Makena markets. We review the first six months of sales activity and take a look at current market conditions and the market outlook. There is a lot to digest in this post so you may want to be suitably caffeinated before proceeding.
While June was a month of substantive increases in inventory, thus far the month of July has seen more limited change. The inventory of single family homes is actually lower now than it was on June 30th. At that time, there were 241 active listings. As of July 23rd, the inventory decreased 3% to 234 active listings.
For the condo market, the inventory of active listings increased modestly. On June 30th, the number of active listings was 199. As of July 23rd, the inventory increased 7.5% to 214 active listings.
Maui’s single family home inventory trends appear to be diverging from the rest of the country when it comes to inventory. That said, we are seeing variability in our market place. Inventory and levels of activity vary by price point and community. We should have an updated break down of inventory trends by price point shortly after the first of the month.
As of July 23rd, 35.04% of all active listings reduced their price at least once. That is up modestly from July 4th when 34.03% of all active home listings reduced asking price.
For condos, 27.57% of all active condos reduced their price as of July 23rd. That is up from 24.63% of condos on July 4th.
We are little bit ahead of the national average when it comes to price reductions, but the number of price reductions appears to be increasing at a slower rate than national markets.
It is interesting to see our rate of price reductions increasing slowly. Prior to the Covid boom, Maui was always a place where sellers tended to be slower to reduce price. Longer days on market were more common. One question we find ourselves asking a lot around the office is what a new real estate normal will look like on island moving forward? Will we go back to typical Maui seller behavior pre-covid or will seller behavior more closely resemble mainland markets? It may take some time to determine the answer to that question.
Another metric we started tracking earlier in the year is the percentage or properties that go under contract within 10 days of coming to the market. Of the homes and condos listed between July 1st and July 8th, 31.91% went under contract within 10 days of coming to market. That is actually up from June 14th-21st when only 25.37% of listings went under contract within 10 days of coming to market. That said, this is also the first time this year when the percentage of homes going under contract within 10 days was lower than the same period of 2019.
It is also worth noting that there is difference between the home and condo market. Of the homes listed between July 1st and July 8th, 23.53% went under contract within 10 days of coming to market. Of the homes listed during the same seven day period of 2019, 25.81% went under contract within 10 days. The condo market continues to see properties go under contract at a brisker pace. Of the condos listed between July 1st and July 8th, 36.67% went under contract within 10 days. That is just ahead of condos listed during the same seven days of 2019 when 36.11% went under contract within 10 days
Some Quick Thoughts on Current Conditions
It’s a strange market out there. Buyer demand is well below what we saw during 2021 and earlier this year with far fewer properties under contract. That said, inventory levels remain well below normal in most communities around the island. It’s likely that the lack of inventory is one reason why we aren’t seeing more price reductions.
It seems as if there is a little bit stronger demand in the condo market than the single family home market judging by the higher percentage of properties going under contract within 10 days. That comes despite a little more condo inventory coming to market.
Buyers will find conditions less competitive than earlier this year. However, well priced properties in areas and price points with low demand can still generate multiple offers. Overall, sellers can expect longer days on market and fewer buyers. Sellers should be particularly mindful of market conditions specific to their community and price point when pricing their property. It’s also worth remembering that negotiation and give and take is a lot more likely today than it was six months ago.
Wailea and Makena Market Overview
This is the first of a handful of features we will be doing in our market musings looking at specific communities on the island. Today, we are focusing on the resort markets of Wailea and Makena. Its worth noting that I used the term markets plural. While our MLS lumps the two areas together, the two communities have differences that make them unique. Wailea is significantly more developed with large hotels, a shopping center and a lot more neighborhoods and condo complexes. While expensive, the entry point for Wailea is much lower than Makena. Makena is smaller, less developed and has the highest concentration of high priced homes on the island.
Wailea Home Sales
This is a look back at single family home sale activity in Wailea during the first six months of 2022. These are some of the most notable numbers from that time.
- Maui Realtors reported 17 homes sold in the Wailea Resort in the first half of the year. That is down 43% from the 30 sales reported during the first six months of 2021.
- Inventory constraints played a significant part in the reduced sales. Decreased demand may be another factor in the second quarter of the year, but it is hard to say definitively.
- Seven of seventeen sales closed for over asking price. Ten of seventeen sold for asking price or above. Demand was strong for the limited inventory available.
- Nine of the seventeen sales were reported to be all cash transactions.
- The median and average price of the homes sold in the first six months of the year is $2,800,000 and $3,478,441 respectively. This is actually down from last year when the median and average price of $3,475,000 and $3,973,168.
- To be clear, the value of homes in Wailea did not depreciate this year. This shift in medians and averages stems from a difference in the composition of inventory sold. The chart below shows the difference between the first halves of 2021 and 2022. While there were still a fair number of sub-$2,000,000 sales in 2021, there was also a much higher volume of transactions for $4,000,000 and above in 2021. This stems in part from the much lower inventory of homes above $4,000,000 in Wailea this year.
- The lowest priced home to sell during the first half of the year in Wailea closed for $2,270,000. That buyer purchased a 3 bedroom, 4 bath home with 2,562 square feet of living space and a pool in the Wailea Kai subdivision.
- The highest priced Wailea sale during the first half of the year closed for $8,750,000. The home in Wailea Highlands includes 4 bedrooms, 7 baths and 8,657 square feet of living space on just under a half acre.
- Wailea Golf Vistas experienced the most sales activity with 5 transactions. Wailea Pualani saw the second most sales with 4 transactions.
Wailea Condo Sales
The numbers below are some of the most noteworthy from the first six months of condo sales in Wailea.
- Maui Realtors reported 77 condo sales in Wailea during the first half of the year. That is down 51% from the 157 sales reported during January-June of 2021.
- Again, scarcity was a big factor in the decrease in sales. At one point in the first quarter, active Wailea inventory dipped to 6 condos. Some of the difference between the two years can also be attributed to new developer sales in Makali’i. The 2021 sales were boosted by 20 closes in Makalii based on contracts signed 2-3 years prior.
- Of the 77 sales, 26 or 33.77% sold for over asking price. An impressive 54 out of 77 sales or 70.13% of all transactions closed for asking price or above. Again, this points to strong demand and competition for the limited supply.
- Maui Realtors reported that 48 out of 77 or 62% of closed transactions were cash purchases.
- The median and average prices of condos sold in Wailea came in at $1,630,000 and $2,408,720 respectively. The median price increased 20.91% and the average price increased 26.56%. These numbers reflect not only increasing values, but also a greater proportion of high priced transactions.
- The lowest priced Wailea condo sale during the first part of the year closed for $650,000. That was for a studio unit in Wailea Ekahi.
- The highest priced condo to sell during the first half of 2022 is located in Wailea Beach Villas. The ground floor unit in the D building closed for $12,500,000. The 3 bedroom, 3.5 bathroom unit includes 2,889 square feet of living space and a private plunge pool.
- Wailea Ekahi and the Palms at Wailea had the most sales activity of any complex in Wailea Resort to start the year with 14 sales each.
Makena Home Sales
- Maui Realtors reported 7 home sales in the Makena area during the first half of 2022. That is the same number as what was reported during the first half of 2021.
- Two of the seven sales closed for over asking price. None of the homes sold for above asking. As you get to these price points, competition decreases and negotiation is more common.
- The median sales price for the 7 Makena homes sold is $17,200,000. The average sales price came in at $18,825,564. That is a 72% increase in median sales price over last year’s $10,000,000 sale. It is a 35.94% increase over last year’s average sales price of $13,848,071.
- This year’s low sale came in Makena came in at a $12,875,000. The oceanfront home in Makena Place includes 4 bedrooms, 4.5 bathrooms and 4,304 square feet of living space.
- The highest priced sale in Makena and the highest sale on Maui for the year to date closed for $26,490,700. That estate includes 8 bedrooms, 8 bathrooms, 10,464 square feet of living space plus a pool house on an acre across the street from the ocean.
- In terms of activity within subdivisions, two homes closed in Makena Place and two homes closed in One Palauea Bay.
Makena Condo Sales
- Maui Realtors reported 9 condo sales in Makena during the first 6 months of 2022. That is down 36% from last year’s first half tally of 14 sales.
- Two of the nine sales sold for full price. No sales closed for above asking price.
- The median and average prices of the 9 condos sold are $4,000,000 and $4,950,645 respectively. Median increased 42.98% over last year’s median of $2,797,500. The average price increased 26.89% over last year’s average of $3,901,500.
- The lowest priced condo transaction in Makena closed for $3,250,000 for a 2 bedroom, 2.5 bathroom 2,745 square foot unit at Na Hale O Makena.
- The highest priced condo transaction in Makena during the first six months of the year closed for $11,256,000. That was a Molokini Residence at the Makena Golf and Beach Club with 5 bedrooms, 5.5 bathrooms and 4,430 square feet of living space.
- Makena Surf saw the most sales activity during the first half of the year with 4 closes.
Wailea and Makena Market Outlook
Of course all of the sales referenced above reflect past market demand. The million dollar question, or twenty million dollar question in the case of some Makena residences, is what can we expect for the second half of the year? Surprising market behavior over the last two years makes any sort of prognostication a challenge and current economic uncertainty makes it that much harder. That said, it is worth at least touching on both the supply and demand side of the equation.
Wailea and Makena Inventory
On the supply side, there is still some variability by location and property type. There are currently 8 active home listings in Wailea with 4 pending. That is a pretty limited supply considering sales and current pending. It is worth noting that of that supply, a couple of sellers are reaching for some pretty big numbers for their respective neighborhoods. While record highs are normal of late, some of the prices are well above previous neighborhood highs. It is also worth noting that only 3 of 6 subdivisions have active inventory, and 5 of 8 listings are in Wailea Pualani.
There are currently 24 active condo listings in Wailea with 8 pending sales. A quick side note, the pending number does not include the 75 pending new developer sales at La’i Loa at Wailea Hills. This is up quite a bit from the 6 active listings on February 1. That said, it is still less than 2 months supply. Again, when honing in on certain condo complexes the inventory is particularly limited. There are six condo complexes with just 1 active listing and 5 condo complexes with no active inventory. It is also worth considering that 3 of the active listings are seeking prices well above all time highs in their complex. There are a number of other sellers seeking new high prices for their respective location or floor plan in their development.
There are currently 5 active home listings and 1 pending sale in Makena. That’s almost 5 months of inventory based on the first half of the year, but it is worth noting that the 7 sales during the first halves of 2021 and 2022 is pretty extraordinary activity. That makes the 5 active listings a healthy inventory for prospective buyers with the considerable means necessary to shop in this part of the island.
The Makena condo market inventory is literally zero. If you are looking for a place in one of the three condo developments or the Makena Golf and Beach Club, it is a waiting game.
The big unknown is what type of new inventory we may see through the end of the year. Inventory growth in July thus far is negligible.
What about Wailea and Makena Demand?
With Makena and Wailea predominantly second home markets, what type of demand will see from second home buyers in a shifting market? The amount of cash involved with transactions makes the market less sensitive, but not completely immune to increases in mortgage rates. Nationally, second home demand is down according to Redfin reports. What about some of the current market indicators we’ve used for the general market?
Of the eight properties listed in the area this month, two went under contract in less than 10 days or 25%. That is just a hair better than the overall Maui market. Of the current Wailea condo inventory, 29% of active listings reduced their asking price. For Wailea Homes, 28.57% of active listings reduced their price. For Makena Homes, 60% or 3 of 5 listings reduced their price. The Wailea numbers are below what we are seeing for price reductions island wide. The one caveat I might add is that historically, resort market listings are slower to adjust price. The Makena number is high, but it also is worth mentioning that pricing properties in the $10,000,000 plus range comes with its own set of challenges. These are large, very unique custom homes not as well suited to comparative valuations.
One last thing to mention is seasonality. Looking at the chart above, you can see that there is a general seasonality to the market in Wailea Home Sales with more properties going under contract during the first half of the year than the second. The same is true for Wailea condos. Makena is a little more random due to its small sample size. If the market follows typical behavior, we should expect less sales activity this year.
Based on all of the above, the Wailea and Makena markets should see less activity for the remainder of the year due to the combination of market trends, seasonality and limited supply. Barring a massive influx of supply and/or a significant worsening of the current economic situation, the limited supply should keep prices elevated.
You can search through the current inventory of Wailea and Makena Homes for Sale and Wailea and Makena Condos for Sale on our site.
A Little Maui Beauty to Brighten This Post
Contact The Maui Real Estate Team
Congratulations if you made it to the end of this post. It was a long one! It also must mean you are pretty interested in the Maui market. Feel free to Contact The Maui Real Estate Team with questions or for assistance buying or selling property on Maui. We would welcome the chance to be of assistance.
Maui Real Estate Blog
Sneak Peek at the November 2014 Maui Real Estate Statistics
The last of the turkey sandwiches have been consumed and Mele Kalikimaka is playing on the local radio stations. That means it is early December and it is a time to take a sneak peek at the November 2014 Maui Real Estate Statistics. This post takes a look at median sales prices, November pending sales and the sales volume for November as compared to November of 2013. I highlight some of the notable numbers from the November sales. I also provide a few thoughts on market activity and what it means for buyers and sellers who are thinking of entering the Maui Real Estate market. Without further ado, here are the November 2014 Maui Real Estate Stats.
November Maui Real Estate Sales Volumes and Median Prices
By my count, there were 73 homes sold in Maui County during November of 2014 with a median sales price of $590,000. Last November, there were 75 homes sold with a median price of $515,000. That calculates to a 3% drop in sales activity and approximately a 15% increase in the median sales price.
I counted 67 condos reported sold in Maui County this November at a median price of $372,500. In November of 2013 there were 96 condos sold at a median price of $350,000. That is a 30% decrease in sales volume and a 6.4% increase in median price when comparing this year to last year.
There have been 10 lot sales reported in Maui County during November of 2014 with a median sales price of $411,500. Last November, there were 23 sales with a median price of $547,371. That is a 54% drop in sales activity and a 25% drop in median price comparing this November to last November.
Notable Numbers From The November Maui Real Estate Sales
While compiling the November sales volumes and medians, there were some other notable numbers that I came across that I thought were worth sharing.
- The highest priced home sale of the month was $2,350,000 for a 5,529 square foot home with a pool on a two acre lot in the Wailuku Country Estates Subdivision.
- That was one of three home sales over $2,000,000 last month. There was one more sale in Wailuku Country Estates and one sale in the Maunaolu Subdivision located between Makawao and Paia. This was a fairly unusual month for high home sales with no activity occurring in the more traditional resort communities. The two Wailuku Country Estates sales were only the second and third homes to ever sell in Wailuku for over $2,000,000.
- The Montage Residences at Kapalua Bay was home to the highest priced condo sale in November. Since coming to market in June, they have accounted for 80% of the condo sales over $4,000,000. This month’s high sale closed for $4,750,000.
- The Montage sale was one of six closes over $1,500,000. The other five closes included one more transaction at Montage, a sale at Honua Kai, a sale at the Whaler, a Wailea Point close and a close at Hoolei.
- The 67 condo sales this month represented the lowest sales total of the year and the second lowest total in the last two years.
- The highest priced land sale last month occurred in the One Palauea Bay subdivision in Makena. The 1.089 acre lot sold for $3,500,000.
- There were 12 bank owned sales this November compared to seven bank owned sales last November. There were 4 short sales this November compared to 13 last year. This is a continuation of a trend where we have seen a slight increase in bank owned inventory and sales compared to last year, while short sales continue to play a decreased role in the market.
Thoughts on The November Stats
The November sales activity followed recent trends on island. Maui’s home sales totals continue to be very close to what we saw last year. Condo sales are down substantially. Land sales are also down substantially. As discussed in the September and October statistics, this drop in condo activity is driven in large part by a reduction in the inventory of properties for sale at the entry levels of the market. I think volumes may also be dwindling due to the pricing strategies of some sellers. There are still quite a few sellers shooting for prices well above recent sales. If some sellers were to be more realistic about their sales prices, we may get a little bit of a bump in condo sales activity.
The drop off in land sales that we saw this month may not be quite as significant as it appears. Land statistics include both commercial sales and lots that might be used for residential purposes. The November 2013 sales included six commercial new development lots in the Maui Lani subdivision. There was only one commercial sale this November. The Peahi Hui subdivision also had an impact last November with five new development sales.
It is worth making a brief note that changes in median prices are not a direct indicator of changes in value. Medians shift due to changes in values AND shifts in market activity. More high priced sales push medians higher and more low priced sales push medians lower. Small sample sizes can make changes in median particularly dramatic. This difference in Land Medians between this November and last November is a great example. It is safe to say that land values have not dropped 25% compared to last year.
November Pending Sales
While the November Sales weren’t very inspiring, are there brighter days in store for the Maui Real Estate Market? That’s tough to say, but we do have some sense of what future sales might be based on the number of properties that went pending in November.
It was encouraging to see pending home sales were up compared to November of last year. It was even more encouraging to see that the number of pending condo sales was higher than November of last year. I am not sure that this is a sign that the condo market is going to see sustained growth or a turn around from it’s recent activity, but it beats the alternative as we head in to our buying season. Pending contracts for land sales are down again compared to last November.
What Does it All Mean for Buyers and Sellers in The Maui Condo Market.
What does this all mean for buyers and sellers? December officially marks the start of peak buyers season. The increases in visitor numbers during winter months means an increase in potential buyers. Buyers will find varying market conditions depending on the part of the market where they are shopping. Market inventory is greatest at the highest price points in the market. Luxury home and condo sellers will find a good selection to choose from. That said, sellers in the luxury market tend to have deeper reserves so they may or may not be as negotiable on price. The entry level vacation rental condo market has seen inventory decrease significantly over the last 12-18 months. Well priced condos in this segment of the market are tending to go quickly. Conditions are similar for entry level homes with buyer competition particularly fierce for well priced properties. Buyers should be pre-approved before looking at homes and prepared to act quickly when the right opportunity becomes available. Sellers should look closely at current market conditions in their price range and community when looking at go to market strategy. Overpriced properties are sitting in this market. These mixed market conditions require thoughtful representation. Contact The Maui Real Estate Team today for a free consultation. We would welcome the opportunity to learn about your real estate needs and discuss the market.
Maui Real Estate Blog
September 2014 Maui Real Estate Statistics
I apologize for being a little slow getting out of the gate with our September Maui Real Estate Statistics. This post includes all of the usual content on median sales prices, sales volume, pending sales and other notable numbers and closes for September. It also includes a deeper dive into the recent condo sales numbers. We have seen a trend develop over the last six months where Maui condo sales totals have under performed compared to last year. I wanted to see if we could peel the onion back and expose any clearly discernible reasons as to why there are fewer condos selling. I have proffered some anecdotal evidence in recent stats posts, but I hoped to find something more substantive in the actual sales data. Keep reading to find out what I learned and all the other numbers from the September Maui Real Estate Statistics.
September Maui Real Estate Sales Volumes and Medians
By my count there were 95 homes sold on Maui in September with a median sales price of $570,000. Last September, there were 85 homes sold with a median price of $470,000. That calculates to approximately a 12% increase in volume and a 21% increase in median price while comparing this September to last September.
There were 79 condos sold last month with a median price of $465,000. By comparison, in September 2013 there were 121 condos sold with a median price of $345,000. That calculates to a 35% decrease in sales volume and a 35% increase in median price when comparing this year to last year.
There were 12 land sales on Maui this September with a median sales price of $520,000. Last September, there were 15 sales with a median price of $335,000. That is a 20% drop in volume and a 55% shift in median price when comparing this September to last September.
Interesting Notes and Numbers From the September Maui Real Estate Transactions
While compiling the numbers above, I thought there were some other facts and figures that were worth sharing from the September Maui Real Estate Transactions.
- The highest priced home that sold last month was actually a bank owned property. A six bed/seven bath luxury home in the One Palauea Bay Subdivision in Makena sold for $8,500,000.
- That was one of six homes sold for over $2,000,000 last month. The other homes were located in Paia, Kula, Kihei, Kapalua and Lanai.
- The slow month for condo sales was reflected in the luxury condo market. There were no sales over $1,500,000. The high sale was a two bedroom/two bath condo that sold at Honua Kai for $1,390,000.
- The highest priced land sale was a beachfront lot in Ka’anapali. The .87 acre lot sold for $6,900,000.
- There were 12 bank owned (REO) sales last month. That is up slightly over the 11 (REO) sales that were recorded in September of 2013.
- There were 6 successful short sale transactions completed in September. Last year, there were 26 short sales in September. With more sellers in improved equity positions on their properties, there will continue to be fewer short sale transactions.
Thoughts on the Maui Condo Market and the September Stats
The condo market continues to catch my eye when looking at the numbers above. There is a continuation of recent trends with condo sales under performing last years transaction totals. Condo sales were down 27% in the third quarter of 2014 when compared to the third quarter of 2013. I thought it was worth taking a more granular look at the condo transactions to see if there are anything that might help to explain the slow down in activity. The chart below compares sales in different price points of the condo market during the third quarter of 2013 and the third quarter of 2014.
As you can see in the chart above, there were only four price points where the 2014 third quarter sales totals outperformed the sales totals of the third quarter of 2013. The biggest drop in 2014 third quarter sales occurred in the price ranges between $101,000 and $400,000. Inventory is a big factor in this price range, particularly in the $101-$200,000 range where there is around three and a half months of inventory available based on recent absorption rates. That limited inventory is clearly hampering sales volume.
The inventory may be even tighter than it appears on paper. With some sellers really shooting for the moon on prices, there is a reduced pool of properties priced at or near market values. Maui has always been a market where sellers tend to reach on their pricing. This is due in part to the fact that there are a lot of second home owners who can afford to let their condo sit on the market for an extended period. The ranks of overpriced properties may also be due in part to changes in the rates of appreciation. Some entry level condos saw huge bounces off the bottom with appreciation reaching into the 70% or more range. Some sellers have based their go to market prices on those recent rates of appreciation. With the last real estate downturn still fresh in some minds, buyers are not willing to sustain those rates over the long haul. That is most apparent with entry level condos priced in the low to mid $200,000s. After big gains in 2012 and the first half or 2013, those condos have seen little to no appreciation over the last 6-12 months.
Once you get above the $400,000 range, the condo inventory is not quite as tight. It has certainly dwindled below what we saw during the doldrums of the market, but there is still more than six months of inventory based on current absorption rates. There is enough inventory that it shouldn’t be constraining market sales. The healthier inventory is reflected in the sales figures in these price ranges. The difference between sales in third quarter 2013 and third quarter 2014 is smaller and there are of course a few price points where 2014 third quarter sales are higher. I am not sure that I can pin all of the decrease in market activity as being driven by inventory constraints, that said there is a clear correlation in some market segments. If there are any other factors that are hampering sales, they are not quite as easy to discern.
The luxury condo market is one part of the market where inventory is abundant. In the $1,500,000 to $4,000,000 price range there is well over a year of inventory based on current absorption rates. That would suggest that inventory is clearly not a factor in the slower third quarter sales volumes for luxury condos. The third quarter slump is something of a surprise as the first half of the year saw very strong sales in this range. It will be interesting to see what happens during the fourth quarter. If the slower sales volumes continue in that price range, it may illuminate what other factors are cramping the condo market. That said, this is a market segment with a small sample size that can see a lot of variability. The fact that there were strong luxury home sales in September makes me think the lower luxury condo sales could be an anomaly.
There was one other thing that I thought was worth mentioning about the September condo numbers. We typically don’t spend a ton of time discussing the median sales prices that we report in our stats posts other than to give the caveat that they aren’t a great indicator of changes in value. Our market size is small enough that the distribution of sales can have a bigger impact on medians than the changes in the values of properties. I think the stats for this month are a good example why. The 35% increase in median is driven heavily by the decrease in sales between $100,000 and $400,000. Fewer lower priced sales resulted in a big boost to the median sales price.
While the condo market has seen a clear trend of decreasing sales compared to last year, the home market has seen similar levels of market activity compared to 2013. As of this month, there have now been four months where sales were stronger than the same month of 2013, four months of slower sales and one month where sales volumes were the same. While constrained inventory has reduced the number of entry level home transactions, that has been offset by a little more activity at the higher price points in the market.
The 2014 Maui land market has occupied a middle ground between the condo and home market. It has had more months with lower sales volume than higher sales volume compared to 2013, but not quite as many down months as with condos. Inventory could be a factor with this market. Lower priced land opportunities are becoming harder to come by.
September Pending Sales
One thing to remember with real estate sales is that they are a lagging indicator. Most transactions on Maui take 30-60 days to close. We also keep track of pending sales in our statistics to get a sense of more recent market demand.
The pending property sales are mirroring current trends. The number of homes that went under contract in September was equal to what we saw in 2013. The land and condo pending sales are both down from 2013 levels although the margins are small.
What Buyers and Sellers Should Expect in The Current Maui Real Estate Market
While sales numbers are down a little, the overall buying and selling experience on Maui has changed very little in the last twelve months. Scarce inventory makes for a competitive market for buyers. Buyers should do all that they can to be prepared to act quickly when well priced properties that fit their needs hit the market. That means getting pre-approved for a loan prior to your search if you require financing. It also means being decisive and putting your best foot forward when submitting offers. Well priced properties are still frequently generating multiple bids. Sellers who want to sell quickly will need to pay attention to recent comparable sales and current conditions within their neighborhood and community. Even with reduced inventories, overpriced properties are sitting with very little interest from the market. Both buyers and sellers should be aware that market conditions can vary significantly by neighborhood and price point. The Maui Real Estate Team would welcome the chance to sit down and discuss your real estate needs and the market conditions in communities that could be of interest. Contact The Maui Real Estate Team for a free consultation.
Maui Real Estate Blog
Unofficial April 2013 Maui Real Estate Statistics
April is a transitional month on Maui. Winter waves become more scarce on the North Shore. The Jacarandas and silk oaks really begin to bloom Upcountry. Mangoes begin to ripen in South Maui and Lahaina. We also see the end of our peak visitor season and the end of our “traditional” peak season for real estate activity. This peak season has seen pretty healthy market acivity. Buyers have been actively seeking out deals and trying to take advantage of the great interest rates available. Demand is no longer the market’s biggest problem. We are now seeing supply issues in quite a few market segments. With all of that in mind, I wanted to provide you with a sneak peak on how the Maui Real Estate market performed last month. Here is some information on sales volumes, sales medians and other numbers that I found to be of interest.
By my early count, there were 77 homes sold last month in Maui County with a median sales price of $500,000. The April 2012 numbers were 79 sales at a median price of $469,000. That is a 3% decrease in sales activity compared to last year and a 7% increase in median sales price.
I counted 142 condo sales last month with a median sales price of $369,995. Last April, there were 129 condo sales at a median price of $399,000. That calculates to a 10% increase in activity over last year and a 7% decrease in median sales prices.
Maui Realtors have reported 14 land sales thus far for April 2013 with a median sales price of $497,500. In April 2012, there were 8 land sales with a median price of $365,000. That is a 75% increase in sales activity and a 36% increase in median sales price.
In addition to the numbers reported above, here are a few other numbers that I came across while compiling the statistics that I thought were worth sharing.
- The high sales price for a home during the month of April was $8,150,000 for an estate property in the One Palauea Bay subdivision in Makena.
- That was one of four sales over $2,000,000 in Maui County during the month of April. By comparison, there was only one sale over $2,000,000 in April 2012.
- The highest priced condo sale in Maui County last month was at Honua Kai Resort. A luxurious three bedroom unit at this West Maui beachfront resort sold for $4,450,000.
- The Honua Kai transaction was one of six condo sales priced over $1,500,000 last month. There were also six condo closes over $1,500,000 in April of 2012.
- One of the condo price ranges that saw a clear bump in activity was the $1,000,000-$1,500,000 price range. There were 14 sales in that range this year verses only 6 last year.
- The busiest condos for sales activity were Honua Kai, Hoolea in Wailuku and Wailea Ekahi. Hoolea is a new development that prohibits vacation rentals.
- There were 13 REO or bank owned sales that closed last month. Last April, there were 21 REO sales. That is a 39% drop in REO sales compared to last April. REO condos have become particularly scarce with only 3 REO closes last month. That is only 2% of the condo sales volume.
- There were 15 short sale transactions that were completed successfully last month. Last April, there 32 short sale transactions that were completed. That is a 53% decrease in short sale transactions.
The condo market highlighted this month’s stats. The 142 condo sales was tied for the second busiest month in the last five year. The only month to exceed that sales volume benefited from a significant volume of new development closes based on contracts originally signed back in 2005 and 2006. The high volume of sales was driven by increased activity in the vacation rental and second home condo markets. This activity helped to offset decreased activity in the lower price ranges of the vacation rental prohibited condo market. This segment saw sales decrease largely due to decreased inventory. With decreased inventory, the few offerings that came on the market at reasonable prices were snatched up quickly in bidding wars. These dynamics are pushing prices up steadily. The price increases are moving slowly from the bottom of the market to higher price points.
The home market saw a nominal decrease in activity due largely to decreased inventory. Demand is there for properties, but inventory is lacking particularly at or below Maui median sales prices. For example, just looking at Maui and excluding Molokai and Lanai there were 22 sales under $400,000 in April. Last April, there were 30 sales on Maui under $400,000. That is a 27% decrease in activity. Stronger demand at higher price points in the market offset most of the decreased volume at the low end.
What does this all mean for buyers and sellers? What can you expect over the next few months? Busy season may be over, but I wouldn’t expect real estate activity to sag much at all. In general, entry level properties in the different communities around the island are likely to see the most competition amongst buyers. Multiple offer situations are common on well priced properties. You will find pockets of competition in higher price ranges as well. The thinner the inventory, the greater the competition for properties. The competition is causing upward price pressure. Buyers should take steps to have necessary funds available and get pre-approved for financing if they don’t want to miss out on opportunities. Sellers will find that market conditions have turned in their favor in quite a few segments of the Maui Real Estate market. That being said, there are plenty of overpriced properties on the market that are languishing without interest from buyers. Sellers need to evaluate their time frame to sell and recent comparable sales to determine their best pricing strategy.
If you are interested in buying or selling Maui Real Estate, the Maui Real Estate Team would welcome the opportunity to meet with you for a free consultation. If you are interested in buying, tell us about your search parameters and we would happy to find inventory that might meet your needs. If you are thinking of selling, we would be happy to discuss market conditions in your neighborhood, share recent comparable sales and provide an estimate of your properties’ current market value. Contact The Maui Real Estate Team today to get started. We look forward to being of assistance.