Maui Real Estate Blog

Wailea and Kihei Vacation Rental Condo Sales Surge

The Maui Real Estate market has seen a healthy bump in condo sales during 2017. Sales volume for the first five months of the year are about 10% higher than the same period of 2016. Much of that growth can be attributed to the vacation rental condo market in Kihei and Wailea. After a couple of relatively slow years, this year has seen a resurgence of buyers interested in South Maui. I wanted to take a look at the numbers specific to Wailea and Kihei, the condos that are seen the biggest increase in demand, and provide a few thoughts on what might be driving the increase in activity.

Wailea and Kihei saw a 56% increase in vacation rental condo sales between January 1st and May 22nd, 2017 compared to the same period in 2016. There were 173 units sold this year vs 111 sold last year. That increase in activity occurred across all price ranges. Condos priced $500,000 and under saw the most activity with 78 transactions. There were 65 closes during the same period of 2015. The 20% increase in sales compared to 2016 was actually the lowest percentage increase in activity for any price range. The price range from $501,000 to $1,000,000 saw a larger increase in activity with 63 sales compared to 33 sales. That calculates to a 91% increase in sales activity. While the $1,000,001+ price range experienced the biggest percentage increase in activity compared to last year with 38 units sold compared to 13. That is a whopping 292% increase in sales activity.

Wailea Condo Sales
Which condo complexes saw the biggest gains? In Wailea, the increases were across the board. Every single condo complex in Wailea that allows vacation rentals has seen more sales in the year to date than they did over the same period of time last year. That said, there were a few condos that stood out over the others.

Wailea Elua
Wailea Elua is a low density complex with 25 two story buildings located on 24 beachfront acres. Prices in the complex range from roughly $1,000,000 for one bedroom units up to over $3,500,000 for front row, beachfront two bedrooms. The property is valued by owners for its low density, location and beautiful Elua Beach. To say that the start of 2016 was not busy for Wailea Elua would be an understatement. There were no closes by this point of the year. As of the 22ndd of this month, there have been 6 closes.

An aerial view of Wailea Elua and Elua Beach.

Wailea Ekahi
Wailea Ekahi is the biggest beachfront complex in Wailea. There are 296 units spread over 54 buildings on 35 acres. It has studio units through two bedrooms in a variety of floor plans. Prices range from the $600,000s for studios all the way up to just under $2,000,000 for two bedrooms close to the beach. Owners like the location, the green belt that goes through the middle of the property, the beachfront pool area and Keawakapu Beach. Ekahi saw decent market activity in 2016 with 5 sales in just under 5 months. There has been double that amount of activity with 10 sales reported this year as of May 22nd.

The popular beachfront pool at Wailea Ekahi.

Wailea Beach Villas
Wailea Beach Villas is home to the highest priced vacation rentable condos in Wailea. The property has 9 buildings on just over 10 acres. Wailea Beach Villas has larger 2 and 3 bedroom floor plans with some units having as much as 2,900 square feet of living space. Prices range from the low $2,000,000s to over $9,000,000. Owners like the bigger floor plans, amenities, newer construction and central location within Wailea. It is situated right behind the shops of Wailea and next to the Grand Wailea. It only had one sale during the first 5 months of 2016. There have been 4 sales to date this year.

Kihei Condo Sales

One of the pools at Wailea Beach Villas.

Kamaole Sands

When I first started in real estate, I met with a vacation rental manager to discuss popular Kihei vacation rentals. Kamaole Sands was the first condo he mentioned. Kamaole Sands has 440 units spread over 10 buildings on 15 acres. It has one, two and a handful of three bedroom floor plans. Prices range from the mid $300,000s up to the $700,000s. Condos located on the “inner circle” green space and condos closer to the ocean sell at a higher premium. Owners appreciate the large green space running through the center of the complex that features a pool, fountains and tropical landscaping. It is located across the street from Kamaole Beach Park III. It is a big complex and it typically has higher occupancy. Over the last few years, there has been an abundance of inventory and relatively few buyers. In 2016, there were just 5 units sold through the first 5 months of the year. This year, there was a clear market shift. Sales increased over 300%, with 16 closes for the year as of May 22, 2017.

An Aerial shot of Kamaole Sands shows the central green belt, pool area and Kamaole Beach Park III across the street.

Maui Banyan
If Kamaole Sands was first on the list of condos mentioned when I talked to the vacation rental manager, Maui Banyan was mentioned shortly thereafter. There are 256 units spread over 8 buildings on 8.6 acres. There are one and two bedroom floor plans. The popular two bedrooms have a lock off that allow the units to be rented as a studio and one bedroom. Prices range from the $low $400,000s up to the high $600,000s. View and high quality remodels tend to distinguish the higher priced properties. The lock off option, two nice pools, the location across from Kamaole II Beach Park and proximity to shops and restaurants are typically some of the first things that owners mention about the property. In the first five months of 2016, there were only 3 sales. As of the 22nd of May, there have been 11 sales reported for the year to date. That is an impressive 366% increase in activity.

One of the buildings at Maui Banyan

Maui Vista
Maui Vista offers one of the lower entry points into the South Kihei vacation rental condo market. The complex has 280 units spread over three buildings on 8.82 acres. Each building has its own pool and set of tennis courts. There are both one and two bedroom floor plans. Prices range from the high $200,000s for fixer units up to the mid to upper $400,000s for two bedrooms. Maui Vista offers good amenities and close proximity to shops and restaurants. It is a block from Charley Young Beach Park. Maui Vista has seen a little more activity over the last couple of years compared to places like Maui Banyan and Kamaole Sands. It had 7 sales through the first five months of 2016. That said, it was another place that experienced a healthy jump in activity. As of May 22nd, there have been 16 sales reported this year.

One of the three buildings at Maui Vista

Why the surge this year?
While the overall Maui real estate market experienced fairly strong years in 2015 and 2016, the vacation rental condo markets in Wailea and Kihei were not seeing the same strong levels of activity. Inventories were high and sales volumes were low. A significant factor in the slower sales over the last couple of years was a lack of demand from Canada. The period between 2007 and 2013 was an era of stronger Canadian Currency. With the Looney at or near par with the U.S. dollar, Canadians were flocking to South Maui. They remained pretty consistent buyers through the recession. The slip in oil prices in 2014 pushed down the Canadian dollar and a significant pool of buyers shrank considerably.

While that explains why sales have been lower the previous couple of years, I don’t think that speaks to why we are seeing the increase this year. The Canadian dollar is still well below par with the U.S. dollar. We have seen some Canadian buyers start to come back, but it isn’t enough to juice the market to the extent that we have with this year’s sales increases. I did my best to look at the geographic composition of buyers this year in some of the Kihei and Wailea complexes over the last five years. I say that I did my best in that more recent sales within the last month may not show the geographic origin of the buyer yet. With some of the older sales, the condos may have already resold preventing me from seeing where the previous owner resided full time. In Kamaole Sands, just 1 out of the 16 buyers this year is Canadian. By comparison, in 2013, 3 out of 10 were Canadian and 2 out of 4 units sold in 2012 were Canadian buyers. Maui Vista had a few more Canadian buyers this year with 3 out of the 16 sold. That is still well below the 4 out of 7 and 4 out of 10 Canadian buyers we saw at Maui Vista in 2012 and 2013 respectively. The one place where we did see a little more Canadian activity this year was among the higher priced Wailea condos. At Wailea Elua 2 out of 6 buyers were Canadian, and 1 out of 4 buyers were Canadian at both Polo Beach and Wailea Beach Villas.

If the Canadians played only a small part in the resurgence, what were the other factors at play that drove the sales increase? I can’t say definitively, but I would suggest there were a few factors at play. The strength of our feeder markets play a part. Real estate markets in the Western United States remain strong. Buyers coming from strong real estate markets may be empowered both psychologically and financially to purchase a second home on Maui. The stock market continues to achieve near record highs. Strong stock returns may enable buyers to make a discretionary second home purchase. The last factor is pure speculation on my part, but I wonder if the growing strength of the Airbnb brand might also play a role. With Airbnb doing more and more advertising, maybe just maybe that is planting the bug in some people’s ear to consider a vacation rental condo purchase. The last factor that enabled the upsurge is more tangible. We had supply to sell. Home sales volumes are down this year on island, but not due to a lack of demand. There just isn’t enough inventory for buyers particularly in the price ranges below $1,000,000. There was plenty of inventory in the condo market after the previous two to three slow years. In Kihei, there are also some pretty good values. Places like Kamaole Sands are still selling for prices a fair amount below the last market peak.

While the market has absorbed some of the inventory during the first five months of the year, there is still a good selection of condos available to sustain healthy activity in the South Maui condo market. I would suspect that we will continue to see stronger sales this year unless something in the overall economic picture cuts back demand. Contact the Maui Real Estate Team if you are considering a vacation rental condo purchase on Maui. We would welcome the chance to talk to you about some of the options on the market that might fit your needs. You can also search MauiRealEstate.com for the full inventory of Kihei Condos for Sale and Wailea Condos for Sale.

Pete Jalbert

Maui Real Estate Blog

The Year in Numbers, The 2015 Maui Real Estate Statistics

Before we head into February, I wanted to take a quick look back at the 2015 Maui Real Estate market. This is a review of sales volumes, median prices and other notable numbers. I also wanted to address a few questions that arose in my own mind while compiling the statistics. Without further ado, here are the 2015 statistics.

This chart compares the volume of homes, condos and lots sold in Maui County during 2014 and 2015.

Maui Sales Volume, Median Prices and Total Dollar Volume
There were 1090 homes sold on Maui during 2015 with a median sales price of $580,000. The total dollar volume of homes sold in 2015 was $931,646,757. There were 942 homes sold in 2014 with a median price of $570,000. The 2014 total dollar volume was $825,770,160. That means we saw almost a 16% increase in sales volume, just under a 2% increase in median price and a 13% increase in dollar volume when comparing 2015 to 2014.

There were 1,199 condos sold in Maui County during 2015 with a median sales price of $410,000. The total dollar volume of condos sold was $763,806,071. The 2014 condo totals were 1,201 sales with a median price of $414,750. The 2014 total dollar volume was $755,031,268. That means sales volume dropped two tenths of a percent, median price dropped just over one percent and the total dollar volume rose one percent in 2015.

There were 154 land sales in Maui County in 2015 with a median sales price of $447,650. The total dollar volume of land sold was $136,353,541. The 2014 sales figures for land were 166 sales and a median price of $520,000. The total dollar of land sold in 2014 was $119,330,455. That is just over a 7% drop in volume, a 14% drop in median price and a 14% increase in the total dollar volume.

Notable Numbers from the 2015 Maui Real Estate Sales

  • The highest priced home to sell on Maui during 2015 closed for $41,775,000. This was by far and away the highest ever priced paid for a home on Maui. The subject property consists of 6,737 square foot house on 4.23 acres in Makena. More than a few eye brows were raised by a sale that was priced well above other comparable properties in the area. The property was not listed at the time that it sold.
  • That was one of 56 homes to sell for more than $2,000,000 during 2015. The 56 homes sold over $2,000,000 was down by 14% from 65 sold in 2014.
  • The Makena and Wailea area were busiest part of the island for sales over $2,000,000 with 13 total closes.
  • There were 17 beach or oceanfront homes that sold in Maui County during 2015. That was a 29% decrease from the 24 oceanfront sales in 2014.
  • On the other end of the spectrum, the lowest priced home to sell in Maui County closed for $94,750. That home is located in the Maunaloa Village area of Molokai. The lowest priced home to sell on the island of Maui closed for $210,000. The three bedroom, one bath home in Wailuku was situated on a tiny 2,370 square foot lot.
  • The highest priced condo to sell on Maui during 2015 closed for $8,500,000. The beachfront, three bedroom unit at Wailea Beach Villas has over 2,900 square feet of living space.
  • That was one of 91 condos sold for over $1,500,000 during 2015. That exceeded the 83 high end condo sold in 2014 by almost 10%.
  • The Honua Kai Resort saw the most high end condo sales activity with 25 closes over $1,500,000. Montage Kapalua Bay was notable with 9 sales over $3,950,000.
  • The lowest priced condo to sell closed for $20,000. That was a 1 bedroom, 1 bath unit at Harbor Lights in Kahului.
  • The highest priced land transaction to close in 2015 sold for $10,800,000. That was for a half acre lot in the Maluaka Homesites area of the Makena Golf and Beach Club.
  • That was one of 6 land sales in this neighborhood for $7,800,000 or more.
  • There were 25 total land transactions of $1,000,000 or more in Maui County during 2015. That was up slightly from 24 sales over $1,000,000 in 2014.
  • The lowest priced lot to sell in Maui County closed for $20,000 for a 5,351 square foot lot on Molokai. The lowest priced lot to sell on Maui proper closed for 26,000. That was a leasehold lot in the Hawaiian Home Lands in Kula.
  • There were 168 bank owned or REO transactions that closed in Maui County during 2015. That was up from the 116 bank owned sales in 2014. That is almost a 45% increase in bank owned sales.
  • There were 49 successful short sales that closed in 2015. That is down 49% from the 97 short sale transactions in 2014.
  • Of the properties that closed in 2015, 36% were reported to have been cash sales. That is down from 2014 when 42% of the sales were said to have been cash transactions.

Some Questions and Answers About the Numbers
While reviewing the numbers above, a lot of questions came up in my mind. In the paragraphs below, I wanted to address some of these questions and give my thoughts on potential answers.

What drove the increased home sales activity this year?
When looking at the numbers above, homes were the only property type to outperform the 2014 numbers. What drove the increase in sales? There were a couple of factors that came into play. I believe a lot of the activity was driven by on island buyers. Island rents have soared over the last few years. Lower interest rates made the buy vs. rent argument that much more compelling. The threat of increased rates in the near term added to buyer urgency. Evidence of the increased demand from local buyers could be found in the big bump in activity in Central Maui. Home sales in that part of the island were up 33% over last year. The Upcountry area also saw a bump with Pukalani, Kula and Makawao sales up 28,31 and 7% respectively. These are communities that tend to draw on island vs second home buyers. A couple of strong years for tourism helped put local buyers in a better position to afford their purchase.

If sales activity was so strong, why did the median home price only increase 2%?
The first thing to note when answering this question is that changes in median price are not a direct reflection of changes in property values. Median price is also driven by shifts in where sales activity occurs. More high end sales can push up the median sales price while more low end sales can push down the median price. While values increased quite a bit more than 2% in many parts of the market, that was offset by a shift in where sales were occurring. There was a 14% decrease in sales over $2,000,000. As mentioned in the paragraph above, we were also seeing higher levels of activity in more affordable communities around the island. These shifts in market activity helped to offset stronger appreciation in some of the lower and middle priced communities on island.

As a follow up question, one might ask exactly how much Maui home values increased in 2015? That is a really tough question to answer. First and foremost, the rates of appreciation varied largely by price point and location. Homes at or below the median saw the most appreciation due to simple supply and demand. These price points had a much larger pool of buyers and supply was relatively limited. Higher end homes have much more inventory and a much smaller pool of buyers. As a result, upward price pressure has been far more limited.

Why did the condo market see a dip in activity?
If home sales were so strong, why were condo sales down? Condo sales are driven more by off island buyers. I would say the weakening Canadian Dollar played a big part in the decrease in condo sales activity. Maui has seen a significant number of Canadian Condo Buyers since about 2007. That was the first year that the Canadian Dollar was on par with the U.S. dollar. The emergence of Canadian buyers in 2007 helped to buoy the Maui market while a lot of mainland markets were already starting to see big decreases in sales and pricing. They continued to be buyers through the downturn and into the start of the recovery. Around 2013, the Canadian dollar started to dip below par and more substantial decreases occurred in 2014 and 2015. At the time of this post, the Canadian dollar is currently worth 72 cents in American dollars. Less buying power means fewer Canadian buyers. It doesn’t help that a lot of the previous Canadian buyers were coming from Alberta. The weakening Canadian dollar is a reflection of weakening oil prices. The drop in oil prices is a double whammy for buyers from the oil rich province of Alberta.

Final Thoughts
I know tomorrow is the first of February, but I still plan on putting out more posts specific to how different communities around the island performed during 2015. Those posts will also include some thoughts on what we might expect to see in those communities during 2016. Feel free to contact The Maui Real Estate Team if you have any questions on the numbers above, or if you need assistance buying or selling property on Maui. We welcome the opportunity to be of assistance.

Pete Jalbert

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 July 2015 Maui Real Estate Statistics

It’s the first week of August and that means it is time to take a look at how the Maui Real Estate market performed during the month of July. It was a busy month of sales on island as the numbers below will show. Our sneak peek at the July stats looks at sales volume, median prices, notable sales, and pending sales. We also give a few thoughts on what stood out in the July sales activity, and what we think is going on in the market. Without further ado, here are the July numbers.

This chart compares the real estate sales volumes in Maui County during July 2014 and July 2015.

July Maui Real Estate Sales Volumes and Medians
By my count, there were 128 homes sold in July with a median price of $590,000. Last July, there were 99 homes sold with a median price of $568,000. That calculates to a 29% increase in sales volume and roughly a 4% increase in median price.

There were 93 condos sold in Maui last month with a median sales price of $399,000. In July of 2014, there were 83 condos sold at a median price of $375,000. That represents a 12% increase in sales volume and a 6% increase in median price.

There were 13 lots sold in Maui during July with a median sales price of $250,000. There were 9 lots sold last July with a median sales price of $550,000. That is an increase in sales volume of 44% and a decrease in median price of 55%.

Other Notable Numbers from the July Maui Real Estate Sales
While compiling the sales volume and median price, I came across a few more notable numbers that I thought were worth sharing.

  • The 128 homes sold in July was the highest total number of homes sold in Maui County during any single month since the downturn.
  • The highest priced home that sold last month was a residential condominium located in the Maluhia at Wailea subdivision. This 4 bedroom/4 bath home with 5,121 square feet of living space sold for $6,900,000.
  • The Maluhia sale was one of 6 home sales over $2,000,000. The other sales included two more properties in Wailea, two homes in Ka’anapali and a home in Maui Meadows.
  • The highest priced condo to sell in July was located in the Wailea Beach Villas. The three bedroom, three bath, direct oceanfront condo sold for $8,500,000.
  • It was a relatively quiet month for luxury condo sales with only one other unit sold for more than $1,500,000. That condo was located at Ka’anapali Alii.
  • The highest priced land sale was $10,800,000 for a .47 acre lot in the Maluaka Subdivision of the Makena Golf and Beach Club. I believe this is the first Makena Golf and Beach Club sale reported in the MLS.
  • There were a total of 19 bank owned or REO transactions that closed in July. That compares to 11 bank owned sales in July of 2014.
  • There were 8 short sale transactions that closed successfully in July. There were 7 short sales that closed successfully last July.

Some Quick Thoughts on the July 2015 Maui Real Estate Sales Activity
July was a busy and interesting month for the Maui Real Estate market. There are a few different items from the stats that are worth discussion. The most noteworthy number was the number of home sales in the month. As I mentioned above, this was the busiest month for home sales since the real estate market crashed back in 2008. Not only that, it was the busiest month by a pretty healthy margin. What is driving this increased activity? If I were to guess at a primary driver, I would imagine that it is buyers trying to get into the market before interest rates increase. With rates expected to increase in the fall, we are likely to see heightened activity over the coming months. I imagine we will see a lag in activity once more substantive rate increases occur. There are two reasons why I am expecting this lag. First, buyers who require financing will have less buying power. Second, a boost in sales activity now tends to come at the expense of sales activity later. This happened when there were tax incentives for first time home buyers during the economic stimulus.

The dip in median sales price for land is notable. This shift is not attributable to a decrease in values. Instead it is a reflection of buyers at the lower price points of the market seeking out lower priced land options with the stock of lower priced homes steadily dwindling.

Sticking to land for a moment, the $10,800,000 sale at the Makena Golf and Beach club is worth a second mention. This is the most expensive cost per square foot sale of residential land in Maui history. The Makena Golf and Beach Club is set to become the most high end community on Maui. It will be interesting to watch sales within this new development over the coming years.

Shifting to the condo market, there were a couple of items that I thought were worth a mention. First, this is the second straight month where the 2015 sales exceeded the totals for 2014. Things look promising for that trend to continue based on the pending sales. On the other side of the spectrum, this is the second month in a row where high end condo sales have been down. I am not so sure that this is a trend as much as it is just variability in the market. That said, it will be worth keeping an eye on the luxury condo market over the coming months.

Pending Sales in July
We like to keep track on the number of properties that go pending in a particular month on our blog. Not only were sales strong last month, it was a pretty good month for pending sales.

This chard compares the number of properties that went under contract in Maui County during July of 2014 and July of 2015

Pending home, condo and land sales all increased last month compared to July of 2014. Again, I would attribute a good portion of this increased activity to buyer’s trying to take advantage of lower interest rates.

What Does This All Mean for Maui Buyers and Sellers?
Buyers looking at properties at or below the median sales prices for Maui will find that the market remains competitive. Well priced properties in this price range are quick to sell. Buyers shopping in this range should get pre-approved prior to their search if they require financing. When a property comes on that meets their needs, being slow to act could cost you an opportunity. Sellers will find that this is an interesting market. While there is increased sales activity, I am reticent to call this a true seller’s market. There is varying level of activity depending on geography and price points. Overpriced properties are sitting at almost all price points. These variable market conditions only serve to increase the importance of quality representation. Contact The Maui Real Estate Team if you are interested in exploring the Maui Real Estate Market. We would welcome the chance to sit down with you and learn more about your real estate needs.

Pete Jalbert

Maui Real Estate Blog

Sneak Peek at the April 2015 Maui Real Estate Statistics

Friday was Lei Day in Hawaii. The first of May is a celebration of the Hawaiian Lei and Hawaiian culture in general. The passing of the first of the month also means that it is time to take a look back on the April Maui Real Estate Statistics. Our sneak peek at the April Maui Real Estate stats includes information on sales volumes, median prices, notable sales numbers, pending sales activity as well as a few thoughts on the stats and what they mean for buyers and sellers. These numbers were compiled on May 2nd so there may be a few sales reported after we publish this post. If there are any substantial changes, we will make note in the comments. Without further ado, here are the April numbers.

April Maui Real Estate Sales Volumes and Median Prices

This chart compares the Real Estate Sales Volumes on Maui during April 2014 and April 2015

By my count, there were 84 home sales that have been reported thus far for April of 2015 with a median sales price of $574,625. In April of 2014, there were also 84 homes sold at a median price of $583,000. That is a 1.5% decrease in median prices with volume unchanged when comparing the two Aprils.

There have been 103 condo sales reported to date for April of 2015 with a median sales price of $405,000. That is significant decrease in volume from April 2014 when there were 136 sales with a median sales price $403,500. That calculates to a 24% decrease in activity and a less than 1% increase in median price.

There were 12 land sales last month with a median price of $417,500. Last April, there were 19 sales with a median price of $510,000. That represents a 37% decrease in sales activity and an 18% decrease in median price.

Other Notable Numbers from The April Maui Real Estate Sales Activity
While compiling the numbers above, there were a few other notable numbers from the April Sales activity that are worth sharing.

  • The highest priced home sale last month was $9,750,000 for a 39.7 acre estate in Haiku. The home is known in the community as the Baldwin Estate after one of its previous owners. The property includes two parcels of land and a main house with 10 bedrooms, 10.5 bathrooms and over 9,600 square feet of living space. In addition to the main house, there are multiple outbuildings, a pool area, tennis court and sumptuously landscaped grounds. This was the highest ever sales price for a home in the community of Haiku.
  • The Baldwin House was one of five home sales over $2,000,000 in April. There were 2 sales in Ka’anapali, a sale in Wailea and a home on Keawakapu Beach in Kihei. The value of the $7,700,000 Keawakapu sale was almost exclusively in the land.
  • In addition to the sales reported above, there are rumors of a sale in the Makena area for $41,750,000. That would be a new record high for Maui. This has not been published on the MLS and the details are sketchy. We will provide updates if we learn anything new.
  • The highest priced condo transaction in April was for a 3 bed, 3.5 bath unit at Wailea Beach Villas. It closed for $6,100,000.
  • While overall condo sales were down, the market over $1,500,000 remained strong. The Wailea Beach Villas transaction was one of 9 sales over $1,500,000 in April. The other transactions included 2 at Honua Kai, 2 at Makena Surf, a Hoolei, a Montage, a Palms at Manele, and a Ka’anapali Ali’i.
  • It was notable that there were no land sales over $1,000,000 last month. The high sale was $718,291 for 4.54 acres on the ocean in the Paukukalo area of Wailuku.
  • There were 9 bank owned (REO) sales on Maui sold via Realtors last month. That is the same number as April of 2014.
  • There were 4 successful short sale transactions last month. Last April, there were 10 short sale transactions that were completed successfully.

Some Quick Thoughts on the April Sales Activity
Looking at the numbers above, this was a stinker of a month for condo sales activity. This was the slowest April for condos sales since April of 2009. It clearly wasn’t due to the top of the market. The 9 sales above $1,500,000 was higher than the 6 sales in that price range during 2014. Below, $1,500,000, there was a decrease in activity at all price points. Condo sales under $300,000 were down from last April by 27.5%. Condo sales between $300,000 and $800,000 were down from last April by 28%. Sales between $800,000 and $1,500,000 were down from last April by 24%.

I don’t have any great quantitative data that points out why these different market segments were down. My guess is that the under $300,000 market is driven in part by decreased inventory. There are fewer condos under $200,000 available and fewer vacation rental condos available under $300,000. As you get up into the next price brackets, I suspect we are feeling the impact of decreased activity from Canadian buyers. With the Canadian dollar down significantly from two years ago, we are seeing fewer Canadian buyers. We are also seeing some sellers failing to adjust to the market. Activity has been down, but there are still a number of sellers trying to push the envelope on pricing with asking prices way above recent comparable sales.

Land numbers were down even more significantly on a percentage basis than condo sales, but those numbers tend to appear more dramatic due to a small sample size. I would argue that this month’s drop is a reflection of monthly variability than any sort of substantive change in market conditions. That said, the land market on Maui remains a lot slower than it was during the last real estate boom.

It is important to note that sales are a lagging indicator. Since the average Maui Real Estate transaction takes somewhere between 30 and 60 days to close, sales activity does not speak to more current buyer demand. That is one of the reasons why we like to keep an eye on pending sales activity in a month.

Pending Maui Home Sales

This chart compares the number of properties that went under contract in April of 2014 and April of 2015 in Maui, County Hawaii.

A grim month of condo sales is partially offset by a better month of pending condo sales. March pending sales for condos were also pretty good so I would expect that we may see an uptick in condo sales for May. Land and homes also saw solid months for pending sales activity. It looks like our last month of peak season was a pretty busy one for buyers.

What Does This Mean for Buyers and Sellers?
The Maui Real Estate market remains schizophrenic. There are strong parts and there are soft parts. Buyers will find that well priced properties priced at or below the median sales price are the most competitive. Those types of properties tend to go quickly and they can attract multiple offers. Well priced properties above the median sales price may also attract heavy buyer interest. Buyers who require financing should get pre-approved prior to their search so that they can better define their budgets, and they can show financial qualifications to sellers. Sellers need to continue to look closely at market activity for their particular neighborhood, community and price point. Overpriced properties are sitting in this market. Pricing above market can cost you money in the long run. It is worth sitting down with an agent to determine a go to market strategy and price. Contact The Maui Real Estate Team today to talk to an agent to discuss your real estate needs. We look forward to being of assistance.

Pete Jalbert

Maui Real Estate Blog

Sneak Peek at the January 2015 Maui Real Estate Statistics

I have to admit, the hardest part of writing my monthly stats posts is usually writing the opening paragraph. I am skipping the prose this month and cutting right to the numbers. Without further ado, here is our sneak peek at the January 2015 Maui Real Estate Stats.

January Maui Real Estate Sales Volumes and Median Prices

This chart compares real estate sales volumes in Maui County During January of 2014 and January of 2015.

There were 74 homes sold in January with a median price of $576,000. In January of 2014, there were 64 homes sold with a median price of $691,500. That is a 16% increase in volume and a 17% decrease in median price.

There were 83 condos sold at a median price $378,000 in January of 2015. Last January, there were 94 sales at a median price of $441,000. That is a 12% drop in activity and a 14% drop in median price.

There were 11 land sales in January in Maui County with a median price of $700,000. There were 13 sales last January with a median price of $370,000. That is a 15% drop in activity and an 89% increase in median price.

While compiling the sales volumes and median prices, I came across some other notable numbers from January’s Maui Real Estate Sales Activity.

  • The highest priced home sale in January was $3,500,000 for a Residential Condominium in the Launiupoko subdivision South of Lahaina. That luxury home featured 3,675 square feet of living space, big views, a pool and 8.5 acres of land.
  • The Launiupoko sale was one of three homes sold for over $2,000,000 in January. There was one more big sale in Launiupoko with the third home located in Ka’anapali Golf Estates.
  • The highest priced condo to close in January was located in the Wailea Beach Villas. The 3 bedoom, 3.5 bath condo with 2,889 square feet of living space closed for $3,800,000.
  • That was one of four condos that sold for over $1,500,000 during the first month of 2015. The other units were located at Honua Kai, Wailea Ekahi and Sugar Cove in Spreckelsville.
  • The highest priced paid for a parcel of land in January was $2,500,000 for 133 acres located off of Baldwin Avenue between Paia and Makawao. This ocean view acreage has the potential for further subdivision.
  • That was one of three land sales over $1,000,000. The other two were located in Pukalani and Launiupoko .
  • There were 9 REO or bank owned transactions that closed in January. That is up from the 4 bank owned transactions in January of 2014.
  • There were 6 short sale transactions that were completed successfully in January. That is down from the 10 short sales in January of 2014.

A Few Comments on the December Stats
There are a few items from the statistics that merit additional commentary. In the December stats, condo activity made a comeback after seeing six consecutive months of lower sales than the year prior. I was anxious to see if we might see successive months of improved condo sales, but that was not to be the case. It will be interesting to see watch buyer demand for condos through the season. There are some positive signs as the January pending sales will show below, but there are also some headwinds in place. Canadians have been active condo buyers for quite a while, but the much weaker Canadian dollar may put a damper on the number of condo buyers from North of the Border.

The number of luxury property sales also seems to be relatively low for January. The three homes sold for over $2,000,000 are down quite a bit from the eight sold last January. The four condo sales over $1,500,000 are down from the seven sales last January. This will be something else to keep an eye on going forward. With a few luxury developments coming to market in the Wailea and Makena area this year, we may be seeing some buyers deferring their buying decisions.

The lower number of high end sales in January is likely one of the drivers for the decrease in median price compared to last year. This is a good reminder that changes in median price are not exclusively a reflection of changes in property values. Home and condo prices continue to rise despite the lower medians. Land prices are also rising but nowhere close to the 89% change in median. Land median price is particularly vulnerable to big fluctuations due to the small sample size of properties for sale.

January Pending Real Estate Sales
With the holidays marking the official start of Maui’s busy season for Real Estate, January is the first full month of our buyer’s season. We are able to get some sense of how our buyer’s season is starting by taking a look at the January pending sales. The chart below compares the number of properties that went under contract in January of 2015 to the number that went under contract in 2014.

This chart compares the number of properties for sale that went under contract in January 2014 with those that went under contract in January 2015

The chart above shows improved performance in all three property types. I don’t want to go overboard on the significance of these numbers as we tend to see a lot of variability in sales month to month, but this is a generally positive sign for real estate activity during the start of this buyer’s season.

What Does it all Mean for Buyers and Sellers?
While our stats posts tend to focus on the island as a whole, the reality is that Maui is made up of many smaller markets. We see varying levels of supply and demand based on price point, community and even neighborhoods. The Maui Real Estate Team would welcome the opportunity to sit down with buyers and sellers to discuss market conditions specific to your real estate interests. Contact The Maui Real Estate Team for a free consultation so we can discuss your real estate needs.

Pete Jalbert