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
August 2014 Maui Real Estate Statistics
September on Maui marks the start of the quiet season for visitors. The beaches and restaurants are a little quieter. Most years the real estate market slows as well. September also brings the first Northwest Swells of the season much to the delight of island wave riders. The air also starts to get a little cooler at night. I live Upcountry and I have found myself reaching for a sweater at night over the last week. The start of September also means it is time to look at the August Maui Real Estate Statistics. As usual, this post features a comparison of the number of sales and median prices verses what we saw in August a year ago. I also highlight some of the interesting notes and numbers that I came across while compiling the stats. I give my thoughts on the state of the market and what it means for buyers and sellers. This post also gives some insight into what we might expect to see in terms of sales in the coming months by looking at the pending sales for August. Without further ado, here are the numbers for August.
August 2014 Maui Real Estate Sales Volumes and Median Prices
There were 68 homes sold in Maui County during August with a median sales price of $567,500. Last August, there were 81 homes sold with a median price of $585,000. That is a 16% drop in volume and a 3% drop in median when comparing this August to last August.
During August, there were a total of 94 condo sales reported by Realtors in Maui County with a median price $410,000. The August 2013 condo sales figures were 113 transactions closed with a median price of $420,000. That is a 17% drop in volume and a 2% drop in median comparing this August to last August.
The August 2014 land transactions in Maui County totaled 14 with a median price of $395,000. Last August, there were 25 sales with a median price of $350,000. That is a 44% drop in volume and a 13% increase in median price comparing this August to last August.
Other Interesting Notes and Numbers from the August Maui Real Estate Stats
While compiling these numbers, I found a few other numbers that I thought were worth passing along.
- The highest priced home sale last month was $2,500,000 for a 5,222 square foot home on 2.58 acres in the Launiupoko subdivision in Lahaina.
- It was a quiet month for luxury home sales with only one other transaction recorded above $2,000,000. That home was located in Ka’anapali Hillside.
- Believe it or not, the lowest priced home sale in Maui County for month and this year for that matter was $1. The leasehold home in Molokai was bank owned. Its lease is set to expire in December when the property will revert back to the lessor who owns the underlying land.
- While luxury home sales were relatively slow, luxury condo sales were strong in August. The high sale for the month was $8,250,000 for a four bedroom condo at Montage in Kapalua. That is the highest ever sales price for a condo in West Maui.
- That was one of eight condo sales last month priced over $1,500,000. There were three additional big sales at Montage including closes of $7,750,000 and $7,500,000. There is a buzz about Montage and we recently looked at the resort’s impact on the market in our Kapalua Real Estate Update. There were also two sales at Papali in Wailea, one sale at Wailea Elua and one at Honua Kai.
- There were only 8 bank owned sales this year compared to 14 sold last year. This isn’t necessarily due to a lack of inventory. June and July saw more bank owned inventory hit the market than what we had seen at any time in the last 24 months. However, the banks have different pricing strategies at this stage of the market. Many of the bank owned listings are being priced above market values.
- There were six successful short sales completed last month compared to 14 completed in August of 2013.
- While land sales were relatively quiet, there were 2 transactions that closed for over $2,000,000 in Kapalua.
Thoughts on the August Stats
This was not exactly a robust month for sales on Maui. This is the fifth straight month where condo sales have been lower than same month in 2013. Home sales have been a little stronger than condos, but we have still seen fewer sales overall compared to last year. Land sales are also down compared to last year after two straight months of lower sales. Inventory or lack thereof is clearly playing a part in the reduced activity. Prices are higher and the selection at the entry levels of the market is limited. That is leaving some buyers on the sideline. A reduction in the percentage of cash purchases on Maui suggests that we may be seeing fewer institutional and professional investors buying properties as well.
There are also some sellers who have overshot the market. They are pricing well above what the market is willing to pay. That may also be reducing the volume of sales. Prices in some parts of Maui have surged from market lows at high rates of appreciation. Limited inventory and pent up demand helped bring prices up rapidly. However, the initial rates of appreciation weren’t sustainable over the long haul. The memories of the last real estate bubble are a little too fresh in the minds of some buyers. This phenomenon is apparent in the Kihei entry level condo market. Places like Kihei Villages and Southpointe were selling in the low $100,000s at the bottom of the market with a handful of units in particularly poor shape closing below $100,000. We started to see sales prices as high as the low to mid $200,000s by the second half of 2013. Prices have since held in that range with little or no upward appreciation. Inventory has increased and days on market has gone up significantly. We are seeing this in other parts of the market as well. Kapalua Golf Villas is a nice vacation rental friendly property in the Kapalua Resort. It saw prices bottom out in 2012 when a large assessment was required to address a big maintenance project. Prices began to rise again rapidly in 2013 with the median price rising from $480,000 to $650,000. The median for this year’s sales has pushed all the way into the $700s. Each significant increase in median has been accompanied by a decrease in sales volume.
Are there any other factors at play with the decrease in sales volumes? That is tough to say at this point. The broader economic picture appears to be good at this time. National sales of existing homes continue to increase as of the last National Association of Realtors report in July. However, California saw a decrease in the number of properties sold compared to the same period last year. That is a continuation of a trend for that state. California is far and away the biggest feeder state for Maui Real Estate buyers. Maui tends to follow the same trends as the California market albeit a few months behind.
August Pending Sales
In addition to tracking closed sales. We also like to keep tabs on the number of properties that went under contract during any one month. This gives us some sense of what the stats might look like in the next couple of months.
After seeing an uptick in land and condo pending sales in July, the pending sales are down again. It appears as if the continued trend of lower sales activity will continue in the September and October sales numbers for Maui.
What Buyers and Sellers can expect under Current Market Conditions
While the market has slowed in terms of sales volume, buyers will find that well priced properties remain competitive. This is particularly true with lower priced homes. Buyers looking in this market should be pre-approved by a qualified mortgage professional as they are starting their home search. When the right property comes on the market that meets their needs, buyers will need to be decisive and act quickly to improve their odds of a successful offer. Sellers can see some of the cautionary tales reflected in the paragraphs above. Buyers are balking at overpriced properties and rates of appreciation appear to be slowing. That makes determining your go to market pricing that much more important. Both buyers and sellers should also be aware that market dynamics vary throughout the island depending on price points and neighborhoods. If you are a buyer or seller interested in Maui Property, we would welcome the chance to sit down with you for a free consultation. Contact The Maui Real Estate Team today to discuss your real estate needs.
Maui Real Estate Blog
Kapalua September 2014 Midyear Real Estate Market Report
The Kapalua Real Estate market has had a tumultuous last five years. The real estate downturn battered the Kapalua Resort’s parent company Maui Land and Pineapple. The financial difficulties and eventual foreclosure of the Ritz Carlton Residences was perhaps the biggest symbol of the recent struggles of the resort. All of that said, the Kapalua Real Estate market showed signs of life in 2013 and the Ritz Carlton Residences are under new ownership and management. The relaunch of the Residences under the Montage brand has brought a buzz back to Kapalua. While Montage brings the buzz, Kapalua wasn’t exactly going to seed. This remains one of the more beautiful resort communities on the planet with renowned golf courses and some of the prettiest beaches in the country. This post takes a look at the state of the Kapalua market for 2014. We compare how the market performed compared to 2013.We take an even deeper dive into recent market history with some of the condo complexes. We also give our thoughts on what some of the numbers mean and the current state of the Kapalua Real Estate Market.
When comparing the first eight months of 2014 to the first eight of 2013, the Kapalua Condo market has seen a modest decrease in sales activity. There have been 22 condo sales to date this year vs 24 in the same period last year. There are seven different condominium communities within the Kapalua Resort. The difference in sales between those communities year to year has been more substantial.
With the differences in sales volume, I thought it might be worth delving into the market dynamics at a number of the seven different condo communities.
The Montage Residences at Kapalua Bay
Montage has grabbed the most headlines of the Kapalua Condo communities this year. The project was previously known as the Ritz Carlton Residences on Kapalua Bay. It came to market in 2009. Developer sales at the upscale condo complex were shut down in 2011 as the development faced headwinds in a more difficult real estate market. While the property has always been impressive, so were constructions costs. Coming to market in the doldrums of the real estate downturn was too tall of a task. The property was foreclosed on in early 2013. Lantern Capital, the new owners, subsequently appointed Montage Hotel and Resorts to manage the property. Montage is a well established luxury brand with a loyal following thanks to communities in Deer Park, Beverly Hills and Laguna Beach. Prior to coming back to market, significant improvements were made to what was already arguably the nicest physical plant of any condo community on island. Among the improvements was the opening of a new restaurant and bar Cane and Canoe. It has been receiving rave reviews since it opened.
The combination of the Montage brand, the beautiful property and the five star service create a package that has been very well received since the property came back to market in June. There have been five developer sales and one resale over the last few months. This is particularly impressive considering the price points that are involved. The lowest priced sale was $4,300,000 while the highest sale was $8,250,000. The high sale was the highest priced condo sale in Kapalua history. The second and third highest priced sales in Kapalua history also occurred at Montage over the last couple of months. There was one other thing that I found to be notable among the sales that have occurred. Four of the Montage buyers were represented by Wailea based agents. While Wailea and Kapalua are both world class resort communities, they each have their own distinctive feel. You seldom have buyers torn between the two communities. The buyers tend to gravitate toward one community over another. While the agents in our office are location agnostic, you tend to see more agents who focus on one of those communities instead of both. It says something about the compelling nature of the The Montage Residences at Kapalua that you are seeing Wailea based agents, and presumably Wailea type buyers making the trek up the coast to Kapalua.
At this time, there are two additional Montage Kapalua condos that are currently under contract with five others units listed. They will slowly release the remaining developer condos out on to the MLS as other units are sold. We anticipate that this luxury development will remain a popular offering for Maui Luxury condo buyers for some time to come.
Coconut Grove and The Ironwoods
I thought it was worth touching on these properties as they formerly had the distinction of being Kapalua’s most upscale condominium developments. One might think that the introduction of Montage into the market might have an adverse effect on both of these condos. I am not so sure that will be the case. It could be argued that Montage will be a complimentary rather than a competitive offering. All three condominiums have their own diverse personalities, locations and physical plants. Coconut Grove offers a lower density complex with an incredible location right on Kapalua Beach. The Ironwoods are also lower density and have their own beautiful setting nestled between Oneloa Beach and the fifth hole of the Kapalua Bay Course. The Ironwoods are also available at a lower price point than either Montage or Coconut Grove. Both the Ironwoods and Coconut Grove are different from Montage in that they prohibit vacation rentals. Neither condo complex tends to see a high volume of real estate transactions in any one year. It will likely take a few years before we get a better sense of how those properties continue to be received by the market with Montage available as another options for Ultra Luxury Condo buyers.
Kapalua Golf Villas
The condo complex that saw the sharpest decrease in sales activity when comparing this year to last year is Kapalua Golf Villas. I would argue that the decreased activity may be a reflection of the a strengthening situation at Golf Villas rather than a weaker market. To understand my reasoning, it is worth taking some time to look at the history of the complex. Aside from the former Ritz residences, it is safe to say that Golf Villas has seen more upheaval over the last few years than any other condo complex in Kapalua. The challenges stemmed from a large assessment that was imposed on the condos. When crews began work re-roofing the condos in the fall of 2011, they started to uncover some much larger maintenance issues that needed to be addressed immediately. Each of the condo owners were required to pay a special assessment over a 24 month period. The assessment ranged from an extra $700 to well over $1,200 a month depending on the size of the floor plan. Within a couple of months of the assessment being announced, there was a flood of inventory that hit the market. The numbers below provide some interesting context for the market dynamics over the last four years.
- In 2011, there were 11 sales at Kapalua Golf Villas and the median sales price was $510,000. The low sales price for the year was $425,000. It was November of 2011 when the need for a special assessment was announced.
- In 2012, there were 25 sales with a median price of $480,000. The low sale was $330,000. That was one of five sales during 2012 below $400,000 at Kapalua Golf Villas.
- In 2013, the sales volume at Kapalua Golf Villas dipped to 11 sales, but the median rose dramatically to $650,000. The low sale price was $489,000.
- In 2014, there have 5 condos sold year to date with a median price of $710,000. The low sale was $645,000.
The flood of inventory that hit the market in late 2011 and 2012 forced some sellers at Kapalua Golf Villas to slash prices. It was clear there were owners that didn’t want to pay or couldn’t afford to pay the new assesment. As a result, you saw those five exceptionally low sales prices. The scope of work covered by the assessment was comprehensive and suggests that the heavy lifting for the maintenance should be covered for some time. The high volume of sales suggests that there were quite a few buyers who saw the upside in the improvements and the long term potential. By the beginning of 2013, the pool of discounted condos at Golf Villas was largely gone and prices began began to recover quickly. You can see that reflected in the significant increase in median prices. By 2014, sales volumes have slowed even further. Sellers have been trying to push the envelope at Golf Villas on pricing. As it stands, the low sale for this year is just $5,000 below last year’s median. This should make for lower sales volume and lower potential for appreciation the rest of the year.
The Ridge at Kapalua
The Ridge at Kapalua hasn’t seen the same tumult that was experienced at Golf Villas, but there have been some similarities in recent market dynamics. In 2011, sales at the Ridge were slow with only 3 transactions recorded. In 2012, we saw some more motivated sellers as well as a few bank owned properties hitting the market. That contributed to a stronger year for sales with a total of 14 transactions recorded. Buyers were able to take advantage of some lower priced opportunities, and we even saw some Bank owned sales in the $400s. In 2013, the lower priced inventory was gone and we started to see stronger appreciation. That said, it was interesting to note that the progression wasn’t linear. The first half of the year saw only one transaction, the second half of the year had 12 sales. Buyers appeared reticent to support the higher prices at the first half of 2013, but the barrier was broken as the comparative value of the Ridge was recognized. Well maintained grounds, beautiful views and a good location compared to comparable priced properties helped drive buyers into the market. For 2014, sales volumes have slowed and the rate of appreciation has begun to slow as well. Buyers seem to be putting a premium on quality over the lower priced units. The 2 one bedroom units that have closed have been very high quality condos in the $800s, while 2 of the 3 two bedroom units have been priced in the $1,400,000 range. I suspect we will continue to see a focus on quality for the remainder of the year.
Kapalua Bay Villas
When looking at the year to year sales, Kapalua Bay Villas has seen the same number of sales to date this year as it did over the same period last year. That isn’t necessarily a good thing in light of current inventory. There are currently 24 active listings at Bay Villas with one condo under contract. Bay Villas has had pretty extensive inventory for the last few years. I would anticipate that the depth of inventory will significantly limit the potential for appreciation. Sellers will need to listen to market feedback and adjust pricing if we are going to see any significant increase in sales volumes.
Overall, the Kapalua Condo market seems to be transitioning from a period where a good portion of the transactions were value driven. After seeing significant appreciation at condos like Golf Villas and the Ridge over the last couple of years, the opportunity for bargain hunting is limited. It is safe to say that the surge of activity at Montage is not bargain hunting. More buyers are seeking quality above all else. There is plenty of quality to choose from among the active listings. You can check out the current inventory of Kapalua Condos for Sale at MauiRealEstate.com.
The Kapalua Home market has not been as robust as the condo market for the year to date. There have been five sales thus far with a median sales price of $3,250,000. By comparison, last year there had been nine sales by this point in time at a median price of $3,500,000. There are a few things that I thought were noteworthy about this year’s closes.
- The five sales included one close in Honolua Ridge, two closes in Pineapple Hill and two more sales at Pineapple Hill Estates.
- The Honolua Ridge close was a bank owned property. This neighborhood was just coming to market towards the tail end of the last real estate boom. As a result, there have been quite a few distressed sales.
- The bank owned property was the lowest priced sale at $1,700,000. This was the only home sale under $3,000,000 in Kapalua this year.
- The high sale was $4,700,000 for Carlos Santana’s home in Pineapple Hill. That home has 7,687 square feet of living space.
Island wide, home sales over $2,000,000 are up 32% compared to last year. It is interesting that Kapalua sales activity has dropped in light of the island wide increase in high end sales. That said, the relatively small sample size of Kapalua sales makes me reticent to read too much into the drop in activity. One thing that I can say is that there have been fewer opportunities for owners looking for bargains. Over the previous two years, a number of the homes that have changed hands have been value purchases priced at the very low end of the various Kapalua neighborhoods. This year there was just the one sale under $2,000,000. There has also just been one other listing priced below $2,500,000. The smaller pool of purchases this year appear to be skewed more towards buyers seeking quality homes that fit their needs.
Moving forward for the rest of the year, Kapalua still has a significant inventory of homes available with 24 active listings. Based on the current pace of sales, that would suggest that there are at least a couple of years worth of inventory still available. While conventional wisdom indicates that more than six months of inventory can lead to price decreases, that isn’t as applicable to a market like Kapalua. Kapalua and other high dollar markets typically have much longer days on market. It is not uncommon for some of the highest priced properties to sit for years. The sellers of these homes are typically high net worth individuals with the staying power to hold on to the property long enough to wait for offers that fit their needs. There may be one or two sellers among the active listings who are motivated; the challenge lies in identifying those sellers. While values are unlikely to fall at this point, the depth of inventory should blunt any movement to push prices upward. You can see the full inventory of Kapalua Homes for Sale at MauiRealEstate.com.
The land market on Maui hasn’t seen a ton of transactions as of late. When you look at a smaller community like Kapalua, the number of transactions shrinks even further. There have been three land transactions in Kapalua this year. One sale was located in the Plantation Estates subdivision. The other two were in the Honolua Ridge area of Plantation Estates. That total is lower than the five sales that we saw last year as of this time. There are a total of nine active listings currently. They are spread amongst all of the residential communities including Plantation Estates, Pineapple Hill, Pineapple Hill Estates and Honolua Ridge. Plantation Estates and Honolua Ridge offer acreage for potential buyers with some lots in Honolua Ridge in excess of 20 acres.
Kapalua Long Range Outlook
There is much to like about Kapalua property over the long term. The resort seems to have weathered the storm of the last real estate downturn and is positioned to grow as a destination. Montage will help to draw new visitors to the resort community. Some of those visitors may find themselves compelled to own their own slice of paradise in Kapalua. Some of those will snatch up some of the remaining new developer inventory at Montage, while others may opt to look at one of the nearby condos, one of the residential neighborhoods or identify a lot to build a dream home. The natural environment, beaches, golf and other amenities make Kapalua as a whole offer a world class destination resort and make for a compelling place to own a home. Contact The Maui Real Estate Team if Kapalua appeals to you. We would welcome the chance to speak with you about the various properties available for sale around the resort. There may be one that fits you!