Maui Real Estate Blog

Maui Luxury Condo Market Update

Earlier this month, we took a look at Maui’s Luxury Home Market. Today, I wanted to turn my sights towards the high end condominium market. This post will include totals on all of the condos sold for the year to date (as of September 20), notable numbers from this year’s sales, and market conditions specific to the three resort areas of Wailea/Makena, Ka’anapali and Kapalua.

When we have discussed luxury condos on our blog, we have used the $1,500,000 and above price point as the threshold for pricing. When we first started to look at the luxury condo market, that was something of a starting point for some of the really high end condos. To be clear, there are some very nice condos below this price point. That said, we want to be consistent with our methodology. So all properties discussed in this particular blog sold for $1,500,000 or more.

Maui Luxury Condo Sales Volume and Median Price
There were 69 condos sold thus far this year as of September 23, 2015. The median price for those sales was $2,250,000. Between January 1, 2014 and September 23, 2014, there were 63 sales at a median price of $2,575,000. That is roughly a 10% increase in volume and a 13% decrease in median price.

Notable Luxury Condo Sales Numbers for the Year to Date.
Here are some of the most noteworthy numbers from the luxury condo sales this year.

  • The highest priced condo to sell thus far this year closed for $8,500,000. This is a three bedroom, three and a half bath, beachfront unit with 2,919 square feet of living space at Wailea Beach Villas.
  • Including the sale at Wailea Beach Villas, there were a total of 12 condos sold over $4,000,000.
  • Honua Kai saw the most sales activity of any condo complex on the island. There were a total of 20 sales at Honua Kai over $1,500,000 including 11 new developer sales.
  • The Wailea and Makena Market saw the most sales activity over $1,500,000 with a total of 28 sales. Kaanapali saw the second most activity and Kapalua was third.
  • In addition to the sales activity in the major resort markets, there was one sale in Lahaina, one in Kihei, one in Spreckelsville and two on Lanai.
  • There were no bank owned condos or short sale transactions among this year’s sales

Wailea and Makena Condos
Wailea and Makena have had a good year for sales to date. The 28 sales reported exceeded last year’s total of 20. That is a 40% increase in activity. Much of that increase in activity occurred in Makena. While there was only one sale in Makena during the same period last year, this year there were 6 sales. Five of the six Makena sales were at Makena Surf. The remaining sale was at Na Hale O Makena. This was a particularly busy year for Makena Surf with the five sales reported thus far more than any year since 2004.

The Wailea sales over $1,500,000 were spread out among a variety of complexes. There were 7 sales at Hoolei, 1 at Andaz, 2 at Kai Malu, 1 at Papali, 1 at Wailea Ekahi, 3 at Wailea Elua, 3 at Wailea Beach Villas and 3 at Wailea Point. Hoolei continues to lead the way in high end sales in Wailea. The size of the condos combined with their price point and the potential to access amenities at the Grand Wailea continues to be an attractive option to buyers. While Wailea Beach Villas did not have the same sales volume, it was noteworthy for the fact that it had the top two highest priced condo sales on the island thus far this year.

This chart compares looks at the sales in Wailea for the year to date compared with the current active inventory on the MLS.

It will be interesting to see what happens in the Wailea and Makena market for the rest of the year and into 2016. There is still a good selection of variety to choose from on the MLS. There is plenty of active inventory on the MLS with 40 condos on the market. There are unlisted properties available at Andaz and the new Keala O Wailea development. There is also a chance that we might see pre-construction sales at Makali’i at Wailea before the end of the year. You can see all of the current Wailea and Makena Condos listed on the MLS on MauiRealEstate.com. Contact The Maui Real Estate Team if you have questions on any of the unlisted properties.

Kaanapali Condos
The Ka’anapali Condo market has also had a fairly strong year with 26 sales reported to date. That is down 7% from the 28 units sold during the same period last year. The Ka’anapali market has been buoyed over the last several years by activity at the Honua Kai Resort. Honua Kai has been a big draw as the first fee simple whole ownership new development along this stretch of coast for over 20 years. Of the 26 condos sold in Ka’anapali for $1,500,000 or more, 20 were at Honua Kai. Ka’anapali Ali’i has had 5 sales thus far this year. There was also one sale at the Masters.

This chart compares the year to date sales in the Kaanapali area with the current inventory of Kaanapali listings on the MLS.

The Ka’anapali luxury condo market is starting to see shrinking inventory with only 20 active listings over $1,500,000. A big part of that stems from Honua Kai. The developer is getting close to selling out their remaining units. There are only 3 new developer listings left on the MLS. I believe there are still a handful of additional new developer units in addition to those posted on the MLS. There are only three units active at Ka’anapali Ali’i with the remaining listings located at Ka’anapali Shores and the Whaler. It will be interesting to see if the dwindling inventory at Honua Kai will have an impact on places like the Whaler and Ka’anapali Shores. Buyers have shown a preference for the newer Honua Kai Condos leading to depressed sales at the other places. Will some of the older condos nearby start to see an uptick in activity? You can see the full inventory of Kaanapali Condos listed on the MLS via MauiRealEstate.com.

Kapalua Condos
The Kapalua Market has seen pretty similar activity levels to what we saw last year. There have been 10 sales reported in the year to date this year. There were 9 sales reported over the same period last year. The focal point for luxury condo sales in Kapalua has been the Montage Residences on Kapalua Bay. Montage came on the market last June. This property was formerly the Ritz Carlton Residences. The Ritz Residences went into foreclosure and the property was purchased by Lantern Capital. Lantern appointed Montage to manage and revamp the property. Montage has seen steady sales since it has come on the market despite pricing that starts in the mid three million dollar range. There have been 8 sales reported at Montage thus far this year.

The other notable sale was at Ritz Carlton Residences. To be clear, this is a different animal from the Ritz Residences Kapalua Bay that was previously foreclosed upon. These condos are part of the Ritz Carlton Hotel. The Ritz condos had been on the market closer to the downturn and weren’t getting as much traction. They are back under the market with a new sales team. It will be interesting to see how these condos are received by the market going forward. From what I have heard, they are getting a pretty good response.

While the two new developments have been relatively well received, some of the older complexes have seen slower activity. High end Kapalua condos like Coconut Grove and the Ironwoods are traditionally condos that see limited inventory and limited sales volume. There was one sale in the Ironwoods this year. Kapalua Bay Villas is a condo that seems to be getting poor market feedback by luxury buyers. There have been 4 sales over $1,500,000 at Bay Villas since 2009. There are currently 7 active listings in the complex with none pending. It appears as if sellers in this complex may need to adjust pricing if they are going to generate interest from buyers.

This chart compares the year to date sales vs the active MLS inventory for condos in the Kapalua Resort.

For the rest of the year, I would anticipate that we will continue to see activity at Montage and the Ritz. Buyers in Kapalua have a good selection of inventory to choose from. You can see the full inventory of Kapalua Condos on the MLS on MauiRealEstate.com. Contact The Maui Real Estate Team directly if you would like us to assist you with buyer representation at either the Montage or the Ritz. There is more inventory available at both of those condos than what is showing on the MLS.

Other Condo Sales Around the Island
In addition to the activity at the resort communities, there have been a handful of sales from other communities around the island. There was one sale in Spreckelsville at Sugar Cove, one in Lahaina at Puamana and one at the Royal Mauian in Kihei. There were also two sales over on Lanai including one at the Terraces at Manele and the other was at the Palms at Manele. The two Lanai purchases were both Larry Ellison buys as he continues to expand his holdings on the island. We tend to see limited activity on higher priced condos outside the main resort areas not so much due to lack of demand as it is a lack of inventory. There are only a handful of condos outside the resorts that can sustain prices of $1,500,000 or greater and they tend not to have a ton of inventory.

Overall Thoughts on the Maui Luxury Condo Market
Buyers still have a great collection of condos to choose from around the island. There are both new development opportunities and condo resales in more established condominiums. While the depth of the inventory may provide options, sellers in this price range tend to have more staying power. The challenge is finding potentially motivated sellers who might want or need to redeploy their money elsewhere.

I would expect that the luxury condo market will continue to be perform at or near the levels we have seen for the year to date. While interest rate increases have been postponed, this isn’t a part of the market that is as interest rate sensitive. The bulk of the buyers are using cash or private banking. The biggest potential impacts to the market come from the greater global economy. Poor performance in the stock market is a potential threat. There seems to be something of a correlation between the DOW and high end sales on the island. We have not seen any significant influxes of buyers from China like some cities in the Western U.S. and Canada. Contact The Maui Real Estate Team if you are interested in buying or selling a luxury condo on Maui. We would welcome the chance to sit down with you for a free consultation and to discuss your interests and needs.

Pete Jalbert

Maui Real Estate Blog

Sneak Peek at the March 2015 Maui Real Estate Statistics

The beginning of April means our peak visitor season is wrapping up. It is also time to bid farewell to the bulk of the Humpback Whales that winter in the waters off our coastline. The end of another month also means another opportunity to take a look at how the Maui Real Estate market is performing. This sneak peek at the March Maui Real Estate Statistics includes information on sales volume, median pricing, pending sales, notable numbers and a few thoughts on the stats and the state of the market for buyers and sellers. Without further ado, here are the March numbers.

March Real Estate Sales Volumes and Median Prices

This chart compares the real estate sales volumes for Maui County during March of 2014 and 2015

By my count, there were 83 homes sold in March 2015 at a median price of $625,000. There were 70 homes sold in March of 2014 with a median price of $590,500. That calculates to a 19% increase in sales volume and a 5% increase in median price.

I counted 122 condos sold in March 2015 at a median price of $442,500. By comparison, there were 127 sold with a median price of $420,000 in March of last year. That is a 4% decrease in volume and a 5% increase in median price.

I counted 14 lots sold in Maui county during March with a median sales price of $528,500. That is the exact same number of sales as March 2014 when there were 14 land transactions with a median price of $507,500. That calculates to a 4% increase in median when comparing this March to last March.

Other Notable March Maui Real Estate Sales Numbers
While compiling the sales volumes and median prices, I came across a few other numbers that were worth sharing from the March Maui Real Estate sales activity.

  • The highest priced home sale on Maui in March was $14,500,000 for a beachfront home in Kihei. The 5,682 square foot home is located on a half acre lot directly on Keawakapu Beach.
  • This was one of five home sales over $2,000,000 for the month. In addition to the Keawakapu home, there were sales in Kapalua, Spreckelsville, Olinda and one additional sale in Kihei.
  • The highest priced condo transaction last month was a 3 bedroom, 3.5 bath unit at Montage Kapalua Bay which sold for $3,995,000.
  • It was a busy month of sales for luxury condos on Maui with 13 closes over $1,500,000. There was one additional close at Montage, 4 sales at Honua Kai, 2 at Ka’anapali Ali’i, 2 at Wailea Point, a Wailea Elua, a Na Hale O Makena and a Masters.
  • The highest priced land sale last month was $1,250,000 for a 5.12 acre lot in Launiupoko.
  • There were 12 bank owned sales that closed in March as compared to 4 bank owned sales last March. There were 4 short sales that closed in March compared to 12 successful short sales last March.

Some Quick Thoughts on the March Stats
March saw a resurgence in home sales activity with sales outpacing both last month and the same period last year. The strength of the market varies by price range with homes below and close to the median sales price seeing the greatest amount of demand and activity. While Luxury home sales improved last month, we are still behind the pace of sales for 2014. This is an interesting market segment as there is a lot of inventory providing abundant selection for buyers. That said, it isn’t a true buyer’s market in the sense that there aren’t a lot of really motivated sellers. The majority of home owners in the higher price ranges tend to have additional staying power that thus far has enabled them to hold out for higher prices.

Condo sales activity dipped below the levels that we saw during March of 2014. Overall sales volume is being impacted by a soft middle of the market specifically in the vacation rental condo market. I would surmise that some of the dip stems from a lack of activity among Canadian buyers. The weakened Canadian Currency has put a good number of potential Canadian buyers on the sidelines. You could also argue that some of the decreased activity in the middle of the condo market may be due to inflated asking prices. With demand down, it is surprising to see how many condos are priced well above recent comparable sales. That said, this is another area of the market where seller motivation appears to be lacking. There are quite a few sellers with enough means and sufficient rental revenue to enable them to hold out for higher pricing. The lower price points of the market continue to see pretty healthy demand. The high end of the market condo market was particularly strong last month with 15 sales over $1,500,000. There is a good selection of high end condos on the market and buyers appear to be taking advantage of the quality available.

The land market continues to chug along at about the same clip as what we were seeing in 2014. Limited financing options and a lack of inventory at lower price points have been the biggest constraints to increased sales activity.

March Maui Pending Sales
Sales are always a lagging indicator of current demand. With that in mind, we started tracking pending sales in our monthly statistics posts. Here is a comparison on what we were seeing going under contract in March of 2015 compared to March of 2014.

This chart compares pending sales in Maui County during March of 2014 and March of 2015

It appears as if March was a pretty strong month for buyer demand for all but land, as both home and condo pendings outpaced what we saw in March of 2014. It is good to see the last full month of buyer’s season end on a good note. It will be interesting to see if the market sustains itself as we transition out of peak buyer’s season later in April.

What Does it Mean for Buyers and Sellers?
Maui market conditions have not seen any significant changes throughout our peak winter sales season. Buyers will find that market conditions vary pretty widely based on price point and geography. The greatest competition among buyers is occurring at or below the median sales price for each community. That said, buyers shopping at higher price points may find that well priced properties can go quickly at almost any price point. It all depends in part on demand within the specific community. As a result, buyers should prepare themselves so they can act quickly when the right opportunity comes along. We strongly advise buyers who will need financing assistance to get pre-approved prior to their search. Prospective Sellers should consult with a Realtor to better understand market conditions specific to their neighborhood and community. While some parts of the market are strong, other parts still have a glut of inventory. Sellers who want to sell quickly should take a strong look at depth of inventory and recent sales prices when developing their go to market pricing. Contact The Maui Real Estate Team if you have questions about buying or selling property on Maui. We would welcome the opportunity to sit down with you to learn more about your real estate needs.

Pete Jalbert