Maui Real Estate Blog

Maui Market Musings Volume XIX

It’s been a few weeks since our last Maui Market Musings. With that in mind, this post delves into the numbers that help cast a light on current Maui market conditions. Since our last post, interests rates surged higher again putting additional pressure on affordability for some buyers. This post looks at what impacts if any higher rates are having on the Maui market. We also look at current inventory levels by price point and community. Other subjects for discussion include cancellations, price reductions and the recent market response to new listings. This is a longer read so you may want to grab your favorite caffeinated beverage before proceeding further. It is not advisable to operate heavy equipment after reading.

Interest Rates

It’s hard not to lead with interest rates when discussing the state of the market. Rates continued their climb since our last update. While they fluctuate daily, they’ve been somewhere between 6.5% and just over 7% over the last few weeks. Needless, to say, we are a long way from the sub 3% interest rates we saw during periods of 2021. For those hoping that this increase is going to be short lived, the recent comments of Fed Chair Jerome Powell suggest that is unlikely to be the case. Powell said higher rates are needed to bring about a “correction” and balance to the housing market. While the Fed doesn’t directly control mortgage rates, they can exert a strong influence with changes to the Federal Funds rate.

Higher rates (even rates lower than current rates) were already impacting real estate markets around the country. Values are starting to retreat in many markets, particularly in some of the frothiest markets of the last couple of years.

So what kind of impact are we seeing on Maui from higher rates? There are a couple of numbers that we look at in this musings that might reflect the impact of higher rates. Pending sales is one with decreased affordability likely to impact the number of buyers. Price decreases is another metric that would or should reflect sellers adjusting to decreased buyer demand. Keep reading to see what those numbers look like recently on Maui.

Maui Home Inventory

7/31/228/31/229/30/22
ActivePendingActivePendingActivePending
<$750,000111411117 (-4)14 (+3)
$750,000-$999,9992562314421 (-10)46 (+2)
$1,000,000-$1,499,9996534582845 (-13)33 (+5)
$1,500,000-$1,999,9994119461344 (-2)17 (+4)
$2,000,000-$2,999,9993119361233 (-3)12
$3,000,000-$4,999,999259321135 (+3)11
$5,000,000-$9,999,99924726527 (+1)6 (+1)
$10,000,000-$19,999,999120110110
$20,000,000+51502 (-3)1 (+1)
Totals239156256124225 (-31)140 (+16)
Maui active and pending home listings by price point on the last day of the month from July, August and September 2022
7/31/228/31/229/30/22
ActivePendingActivePendingActivePending
Haiku221120724 (+4)7
Hana41829 (+1)1 (-1)
Ka’anapali107104103 (-1)
Kahului132111257 (-4)26 (+1)
Kapalua514140 (-1)
Kihei4814441635 (-9)16
Kula1916241022 (-2)11 (+1)
Lahaina181423721 (-2)10 (+3)
Makawao149151113 (-2)11
Napili/Kahana/Hono…1061449 (-5)7 (+3)
Pukalani76856 (-2)7 (+2)
Spreckelsville/Paia10215310 (-5)4 (+1)
Wailea/Makena15516410 (-6)8 (+4)
Wailuku3935412236 (-5)26 (+4)
A comparison of active and pending home listings by community for the last days of the month from July-September 2022. It does not include all communities on Maui.

End of September Home Inventory Review

The information above is provided with the usual framework. The home inventory data by price point includes all of the island of Maui, but excludes the islands of Molokai and Lanai. The district information is limited to the districts with the most activity.

  • The inventory of active homes fell 12.2% between the last day of August and the last day of September.
  • Active inventory decreased in all price ranges below $3,000,000. There was a modest increase in inventory between $3,000,000 and $10,000,000, no change between $10,000,000 and $19,999,999, and a decrease in inventory above $20,000,000.
  • Pending sales activity increased 12.9% over last month! This is a surprising reverse of recent trends. It is an especially big surprise with the recent mortgage rate increases.
  • The biggest increase in pending sales occurred below $2,000,000. Above that price range the number of pending sales was either steady or increased by one. No price ranges experienced a decrease in pending sales activity. It is worth noting that the $10,000,000 to $19,999,999 range had no pending sales as of the end of August and still has no pending sales.
  • Looking at the different communities around the island, only two communities saw an increase in inventory. Haiku and Hana both saw modest increases in active listings. Anecdotally, it seems like some sellers in these windward communities try to get homes on to the market before the start of the rainy season later in the fall. I haven’t taken the plunge to determine if there is any quantitative evidence to support that claim.
  • After seeing big growth in inventory in late Spring and early Summer, Kihei saw the biggest decrease in active inventory for the second month in a row. Notably, the total number of pending sales in Kihei did not change. With that in mind, I decided to look a little closer at the Kihei market activity. While Kihei added 8 new pending sales this month, 7 sales closed, 8 listings cancelled and 2 expired. Only 4 new listings came to market. Based on those numbers, the reason for the decrease in inventory is multi-faceted. The cancellations could be a sign of seller capitulation (more on that below) or just sellers taking a break. We shall see.
  • Wailea and Wailuku are the two communities that saw the biggest increase in pending sales with 4 net new pendings. Wailea’s increase is a little more notable due to the percentage increase in pending sales. It’s worth mentioning that 4 of the 5 overall new pending sales in Wailea and Makena reduced prices before going under contract. There’s something to be said for listening to market feedback and adjusting price.

Maui Condo Inventory

7/31/20228/31/20229/30/2022
ActivePendingActivePendingActivePending
<$250,000181613 (-3)
$250,000-$499,9991123141711 (-3)16 (-1)
$500,000-$749,9994339344328 (-6)40 (-3)
$750,000-$999,999444333433333 (-10)
$1,000,000-$1,499,9993031293119 (-10)36 (+5)
$1,500,000-$1,999,9993033243518 (-6)34 (-1)
$2,000,000-$2,999,9992036223814 (-8)43 (+5)
$3,000,000-$4,999,9991218121910 (-2)17 (-2)
$5,000,000-$9,999,999103817 (-1)0 (-1)
$10,000,000+404040
Totals205234181233145 (-36)222 (-11)
A comparison of end of the month active and pending condo sales by price point from July through September of 2022.
7/31/20228/31/20229/30/2022
ActivePendingActivePendingActivePending
Ka’anapali2413251617 (-8)14 (-3)
Kahului283734 (-3)
Kapalua101011610 (-1)4 (-2)
Kihei6760506348 (-2)61 (-2)
Lahaina1689105 (-4)7 (-3)
Ma’alaea56364 (+1)4 (-2)
Napili/Kahana/Hono4034452529 (-16)30 (+5)
Wailea2582248619 (-5)86
Wailuku14139148 (-1)12 (-2)
Active and Pending Condo inventory by district in Maui during July-September of 2022. This does not include all districts.

End of September Condo Inventory Review

Again, the tables above come with the usual framework for our end of month inventory. The table by price point includes all condos on Maui, but it does not include condos on the islands of Molokai or Lanai. The table with districts is limited to the communities with the most activity. Pending sales at La’i Loa at Wailea Hills skew the data in Wailea and the $1,500,000-$5,000,000 price ranges. There are 75 pending sales in that development based on contracts penned in 2020 and the first quarter of 2021. Pending sales in La’i Loa won’t start to close until sometime in 2023. Paradise Ridge Estates in Kihei also skews the data albeit to a lesser extent. There are 18 pending sales with that development based on contracts penned between 2018 and the first quarter of 2022. Overall, 41.89% of current pending sales are long term new developer contracts.

  • The number of active condo listings at the end of September is 19.89% lower than at the end of August.
  • Active inventory decreased in seven out of ten price ranges in the table above. Net inventory was unchanged in the remaining 3 ranges.
  • Pending condo sales dropped 5.2% compared to the end of August. Is this a reflection of reduced inventory, reduced demand or both? It’s hard to say. That said, I did get a surprising number of e-mails last month from fellow Realtors seeking out condo inventory for buyers struggling to find what they want.
  • Pending sales dropped in seven of ten price ranges. Pending sales increased between $1,000,000-$1,499,999 and $2,000,000 and $2,999,999.
  • Ma’alaea is the only community where inventory increased last month albeit with just one more active listing than at the end of August. Kahului’s inventory is unchanged.
  • Napili, Kahana and Honokowai experienced the biggest decrease in inventory with 16 fewer listings at the end of this month. It was also the only community where pending sales increased. The eighteen new pending sales shows pretty healthy activity. It seems that the increase in pending sales is the biggest driver for the decrease in active listings in this market, but cancelled listings were also a factor. Seven sellers pulled their listings off the market.

Cancelled Listings

September is a transitional month on Maui. The summer tourism season is over and we are still a few months from our peak winter season. Anecdotally, I always thought of this as a month where some sellers will opt to take a pause from selling their home only to relist when it gets closer to winter tourism season. With the sharp decrease in active listings this month, I wanted to look closer at cancelled and expired listings. Is September actually a bigger month for cancellations historically? If so, how does this year compare to previous years? Is there anything that can be gleaned from this September’s high cancellations?

20222021201920182017
January2723483755
February219414334
March1815393658
April1917373977
May1322484089
June1916312753
July1722403058
August2716254462
September40 (1)28 (2)39 (t6)50 (1)41 (11)
OctoberTBD16374760
NovemberTBD30364760
DecemberTBD20432945
Monthly cancelled and expired home listings in 2022, 2021, 2019, 2018 and 2017. I note how September ranks each year in the table.
20222021201920182017
January1955274255
February1354381534
March1254274158
April1435433877
May1521543789
June1120372653
July1116234358
August2019212762
September29 (1)13 (11)43 (t2)44 (3)41 (11)
OctoberTBD15374960
NovemberTBD15406560
DecemberTBD11304145
Monthly cancelled and expired real estate listings during 2022, 2021, 2019, 2018 and 2017

Before discussing the numbers above, it is worth noting that there is some noise when it comes to cancelled listings. An agent changing brokerages or one brokerage buying another can inflate cancelled listings. The change in brokerages results in cancelled listings immediately replaced by new listings as old listing contracts are cancelled and new contracts created. I noticed some noise in this month’s cancelled home listings. Hoku’ula, a new development Upcountry, cancelled their MLS listings last month and put them back on the market as new listings at a higher price.

With that framework, let’s address the first question that I posed above. Is September a bigger month historically for cancellations? It appears to be one of the biggest months for canceled home listings albeit with some notable exceptions in the chart above. For condos, it is a little more extreme. Some years it is near the top and others near the bottom with no clear cut reason for the variability.

So what does that say about this year? Even without those five Hoku’ula cancellations, September would still be the highest month for home cancellation for the year to date. September is also leading for cancelled condo listings despite rather limited inventory. It’s hard to say definitively if this is strictly seasonal or if any of those cancellations are due to seller capitulation. That said, it would make sense if we start to see some sellers retreat from the market for non-seasonal reasons. Sellers who were fishing for ultra high prices, don’t need to sell or need to borrow at higher rates to buy a new place could all have reason to pull their listing under current conditions.

Price Reductions

Recent increases in interest rates are generating more price reductions nationally. Sellers are reacting to the decreased affordability posed by higher rates. What about the Maui market? Are we seeing similar trends? I looked at price reductions for active inventory on September 29th.

As of the 29th, 95 out of 224 active listings or 42.41% of all properties reduced their price one or more times. As of September 2nd, that numbers was 42.97%. On August 15th, it was 39.67%. While price reductions are up since the early summer, the more recent decrease in price reductions is somewhat surprising in light of the recent increases in rates.

On the condo front, 36 out of 144 active listings reduced their price one or more times. That calculates to 25% of active inventory. That is down from 27.84% on September 2nd and 29.62% of all listings on August 15th.

With inventory shrinking, perhaps sellers are feeling emboldened to stick to their guns on pricing. The higher level of cash and or low inventory levels seem to be making this market less responsive to interest rate changes thus far.

How Quickly Are New Listings Going Under Contract?

Another metric we continue to watch in the musings is how quickly things are going under contract. Specifically, what percentage of listings are going under contract within 10 days or less. We started tracking this in mid-February when the number was right around 56%. That was pretty much the peak of our winter frenzy. For properties that were listed between September 12th and 19th, 34% of all listings went under contract within 10 days. That is actually up from 29.79% between August 10th and 17th.

For home listings, 32.14% of new listings between September 12th and September 19th went under contract within 10 days or less. By comparison, 38.1% of all homes listed between 9/12/21 and 9/19/21 went under contract in 10 days or less. For a pre-covid comparison, 41.18% of all homes listed between 9/12/19 and 9/19/19 went under contract within 10 days or less. It is worth mentioning that 41% is a much higher percentage than other weeks we’ve looked at in 2019. For example, only 19.04% of homes listed between 9/27/2019 and 10/3/2019 went under contract in 10 days or less.

For condo listings, 36.36% of all new listings went under contract within 10 days between September 12th and 19th. Last year, an eye popping 67.74% of condos listed between 9/12 and 9/19 were under contract in ten days or less. In 2019, 27.27% of all condos listed between 9/12 and 9/19 went under contract within 10 days or less.

Overall, the market is way less frenzied than last year. However, properties are going under contract faster than in a “normal” Maui market. There are definitely fewer buyers, but there are enough buyers out there for the limited supply that over one third of the inventory is going under contract quickly.

A Few Closing Thoughts on the State of the Maui Market

The numbers compiled above paint a picture of a more resilient Maui market than one might expect. We actually saw fewer price reductions for homes and condos while pending home sales increased! Not exactly the market response one would predict when interest rates increase to their highest point in 15 or more years. It appears at this point that limited inventory is still having a significant impact on the market despite the rising borrowing costs.

Will that sustain itself through the rest of the year and into early 2023? I was suprised by this month so who knows what the future will hold. It’s likely that the market has yet to feel the full weight of higher interest rates. Add in signs of a slowing economy and our market is facing additional headwinds. Ultimately, the Maui market moving forward will be a balancing act between the impact of higher rates and supply constraints. Conditions well vary around Maui by both price point, location and property type.

With interest rates likely to remain elevated into the immediate future, more real estate economists are anticipating price corrections. Reading beyond the headlines, economists expect variability in market corrections across the country. Rates will be a market driver, as will the state of the economy and local inventory. It’s important not to base market decisions on national headlines, but instead on relevant local data. We plan to continue with our Musings and community market updates so Maui buyers and sellers have the data to make informed decisions.

A Little Maui Beauty to Brighten Your Day

Contact The Maui Real Estate Team

Questions about the post above? Wondering about conditions in a specific part of the Maui Market? Need assistance buying or selling a property on Maui? Contact The Maui Real Estate Team for assistance. One of our experienced and savvy agents would welcome the chance to sit down with you to discuss your real estate needs.

Pete Jalbert

Maui Real Estate Blog

Maui Market Musings Volume XVII

This is our seventeenth Maui Market Musings. This edition continues to focus on the metrics that give us the best indication of current market conditions. Those three metrics are inventory, price reductions and how quickly properties are going under contract. Discretion was the better part of valor and I am going to hold off on my Kapalua market update for either the next musings or a stand alone post. I imagine people have more to do over the holiday weekend than reading a 3,500 word manuscript on the Maui Real Estate Market. Without further ado…

End of Month Inventory of Maui Single Family Homes

6/30/227/31/228/31/22
ActivePendingActivePendingActivePending
<$750,00061611141111 (-3)
$750,000-$999,9993263256231 (+6)44 (-18)
$1,000,000-$1,499,9994337653458 (-7)28 (-6)
$1,500,000-$1,999,9994422411946 (+5)13 (-6)
$2,000,000-$2,999,9993415311936 (+5)12 (-7)
$3,000,000-$4.999,999271025932 (+7)11 (+2)
$5,000,000-$9,999,99923824726 (+2)5 (-2)
$10,000,000-$19,999,99913012011 (-1)0
$20,000,000+415150
Totals241169239156256 (+17)124 (-32)
Maui active and pending home listings by price point on the last day of the month from June, July and August 2022
6/30/227/31/228/31/22
ActivePendingActivePendingActivePending
Haiku2013221120 (-2)7 (-4)
Hana42418 (+4)2 (+1)
Ka’anapali117107104 (-3)
Kahului827132111 (-2)25 (+4)
Kapalua53514 (-1)1
Kihei4522481444 (-4)16 (+2)
Kula2513191624 (+4)10 (-6)
Lahaina2018181423 (+5)7 (-7)
Makawao131214915 (+1) 11 (+2)
Napili/Kahana/Hono…12310614 (+4)4 (-2)
Pukalani127768 (+1)5 (-1)
Spreckelsville/Paia11210215 (+5)3 (+1)
Wailea/Makena13415516 (+1)4 (-1)
Wailuku3933393541 (+2)22 (-13)
A comparison of active and pending home listings by community for the last days of the month from June-August 2022. It does not include all communities on Maui.

End of August Home Inventory Review

The information above is provided with the usual framework. The home inventory data by price point includes all of the island of Maui, but excludes the islands of Molokai and Lanai. The district information is limited to the districts with the most activity.

  • The inventory of active home listings on Maui actually increased approximately 7% since the last day of July. This comes on the heels of a decrease in active listings in July.
  • Active inventory decreased in only two price ranges.
  • Pending sales dipped again. Pending listings are 21% lower than the end of July and 27% below the end of June.
  • Pending sales increased in only the $3,000,000 to $4,999,999 price range.
  • Looking at the different price ranges, the $750,000-$999,999 price point stands out. Through the market boom of the last couple of years, you could make an argument that this was among the most competitive price points. Needless to say, this is a very different market now. The increase in interest rates reduced affordability for local buyers, and many investors seem to be sitting on the sidelines. As of today, 56% of the active listings in the range reduced their asking price at least once. Sellers are needing to adjust their price to the new realities of the market.
  • Looking at the different communities around the island, the month to month shifts in the trajectory of inventory are notable. A number of places where inventory increased between June and July, decreased between July and August and vice versa. I would suspect we might continue to see this pattern moving forward.
  • Kihei home inventory is notable for it’s month to month decrease after steady and significant growth in active listings over the previous months.
  • Resort market inventory saw limited changes in active inventory. Ka’anapali and Kapalua both have one fewer active listings while Wailea has one more.

End of August Maui Condo Inventory

6/30/227/31/2228/31/22
ActivePendingActivePendingActivePending
<$250,000281816 (-2)
$250,000-$499,9991925112314 (+3)17 (-6)
$500,000-$749,9993140433934 (-9)43 (+4)
$750,000-$999,9994446444333 (-11)43
$1,000,000-$1,499,9992930303129 (-1)31
$1,500,000-$1,999,9992834303324 (-6)35 (+2)
$2,000,000-$2,999,9992036203622 (+2)38 (+2)
$3,000,000-$4,999,999112512181219 (+1)
$5,000,000-$9,999,9991131038 (-2)1 (-2)
$10,000,000+304040
Totals199247205234181 (-24)233 (-1)
A comparison of end of the month active and pending condo sales by price point from June through August of 2022.
6/30/20227/31/20228/31/2022
ActivePendingActivePendingActivePending
Ka’anapali2315241325 (+1)16 (+3)
Kahului43283 (+1)7 (-1)
Kapalua129101011 (+1)6 (-4)
Kihei5574676050 (-17)63 (+3)
Lahaina1651689 (-7)10 (+2)
Ma’alaea55563 (-2)6
Napili/Kahana/Hono4834403445 (+5)25 (-9)
Wailea 2385258224 (-1)86 (+4)
Wailuku121214139 (-5)14 (+1)
Active and Pending Condo inventory by district in Maui during June-August of 2022. This does not include all districts.

End of August Condo Inventory Review

Again, the tables above come with the usual framework for our end of month inventory. The table by price point includes all condos on Maui, but it does not include condos on the islands of Molokai or Lanai. The table with districts is limited to the communities with the most activity. Pending sales at La’i Loa at Wailea Hills skew the data in Wailea and the $1,500,000-$5,000,000 price ranges. There are 75 pending sales in that development based on contracts penned in 2020 and the first quarter of 2021. Pending sales in La’i Loa won’t start to close until sometime in 2023. Paradise Ridge Estates in Kihei also skews the data albeit to a lesser extent. There are 18 pending sales with that development based on contracts penned between 2018 and the first quarter of 2022. Those should start closing in the not too distant future.

  • After steadily increasing over the last few months, active condo listings at the end of August dropped 12% from the end of July.
  • Pending condo sales were virtually unchanged with only one fewer pending sale at the end of August compared to the end of July.
  • Looking at the data by price range, active inventory only increased between $250,000-$499,000 and between $2,000,000 and $2,999,999. The biggest drops in active inventory occurred between $500,000 and $999,999 followed by $1,500,000 to $1,999,999.
  • Kihei continues to be one of the more dynamic communities when it comes to inventory. Much like Kihei Home inventory, Kihei Condo inventory dropped significantly since the end of July. That comes on the heels of seeing the largest increase over the months prior. Pendings increased as well. Without doing a really thorough comparison of the month to month inventory, it’s hard to say if this is variability or sellers adjusting their pricing and buyers responding.
  • The Napili, Kahana and Honokowai condo inventory took the opposite trajectory from Kihei with pending sales dipping substantially and active listings increasing on the month.
  • The change between the end of the month active inventory in the resort markets was nominal. Wailea’s active inventory increased by 1 and both Kapalua and Ka’anapali decreased by 1. Pendings increased in both Ka’anapali and Wailea while the Kapalua pending sales dipped.

One final thing worth noting about home and condo inventory, September 1 marks something of a seasonal shift on Maui. Labor day is the end of our summer tourist season. Traditionally, real estate activity on island slows a little in the early fall. This is a time when some sellers take a break from the market. Eleven home and condo listings either cancelled or expired on September 1 after the numbers for the charts above were compiled. We also tend to see a little less in the way of new inventory. One would think that would be the case this year, but there are fewer certainties in this day and age.

Checking in On Price Reductions

Nationally, there is some discussions of price reductions starting to level off after steady growth over the last few months? What about Maui? Looking at the inventory as of September 2nd, 42.97% of all active home listings reduced their price one or more times. On August 15th, 39.67% of active homes reduced their price. On July 4th, that number stood at 34.03%.

In the condo market, 27.84% of all active listings reduced their price. That is actually a decrease from 29.62% on August 15th. For further context, 24.63% of the active condo listings had a reduced asking price on July 4th.

It’s worth noting, that some parts of the market have more price reductions than other. There is a fair amount of variability in the market by district and price point. One example being homes in the $750,000-$999,999 price range which I mentioned earlier.

How Quickly Are Things Going Under Contract?

Another metric that gives a pretty good sense of current demand and market conditions is the rate at which properties go under contract. Specifically, we look at what percentage of properties go under contract in ten days or less. We started tracking this in February when market conditions were particularly frenzied. At the time, 56% of all properties went under contract within 10 days. Of the listings that came to market between August 10th and August 17th, 29.79% went under contract within 10 days. That’s actually up a little from the last period we tracked between July 25th and August 1st when 22.45% went under contract within 10 days or less of coming to market.

Looking specifically at homes, 30.43% of the new listings between August 10th and 17th went under contract in 10 days or less. For comparison’s sake, between August 10-17, 2021, 50% of new inventory went under contract in 10 days or less. For a pre-covid reference point, it was 15.15% of new home listings between August 10th – August 17th, 2019 . I do want to mention that this seems to be an anomalously low week. Other recent 2019 comparisons came in around 25%.

For condos, 29.17% of the new listings between August 10th and August 17th went under contract in ten days or less. During the same time span of 2021 and 2019 respectively, the numbers came in at 58.33% and 30.43%.

Overall, we are well below last year’s frenzy. While we may have fewer buyers and sellers, the overall absorption of new properties is similar to what we experienced before Covid.

Interest Rates

One other variable relevant to market conditions is interest rates. Recent movement in the bond market pushed interest rates on the 30 year fixed mortgage back up over 6%. This is the first time mortgages hit that rate since June. From recent discussions with mortgage brokers, many borrowers are opting for 10 year ARMs to lower monthly payments. That said, regardless of the mortgage product borrowing costs are significantly higher now than they were 12 or even 6 months ago. That is going to have a big impact on affordability.

Some Musings Eye Candy From Maui’s Sandy Shores

Contact The Maui Real Estate Team

Questions, comments or feedback? Contact The Maui Real Estate Team to discuss the latest market musings or if you need assistance buying or selling Maui Real Estate. Our experienced team of agents is well suited to assist buyers and sellers in the current dynamic market conditions. We look forward to hearing from you and discussing your real estate needs.

Pete Jalbert

Maui Real Estate Blog

Maui Market Musings Volume XV

Welcome to the 15th edition of our market musings. The last musings was a little more of a backwards looking post as we reviewed notable numbers from the June Stats and took a deep dive into the land market during the first half of the year. This edition focuses on statistics that might be better suited to addressing current market conditions. We also take a longer look at the Wailea and Makena markets. We review the first six months of sales activity and take a look at current market conditions and the market outlook. There is a lot to digest in this post so you may want to be suitably caffeinated before proceeding.

Inventory

While June was a month of substantive increases in inventory, thus far the month of July has seen more limited change. The inventory of single family homes is actually lower now than it was on June 30th. At that time, there were 241 active listings. As of July 23rd, the inventory decreased 3% to 234 active listings.

For the condo market, the inventory of active listings increased modestly. On June 30th, the number of active listings was 199. As of July 23rd, the inventory increased 7.5% to 214 active listings.

Maui’s single family home inventory trends appear to be diverging from the rest of the country when it comes to inventory. That said, we are seeing variability in our market place. Inventory and levels of activity vary by price point and community. We should have an updated break down of inventory trends by price point shortly after the first of the month.

Price Reductions

As of July 23rd, 35.04% of all active listings reduced their price at least once. That is up modestly from July 4th when 34.03% of all active home listings reduced asking price.

For condos, 27.57% of all active condos reduced their price as of July 23rd. That is up from 24.63% of condos on July 4th.

We are little bit ahead of the national average when it comes to price reductions, but the number of price reductions appears to be increasing at a slower rate than national markets.

It is interesting to see our rate of price reductions increasing slowly. Prior to the Covid boom, Maui was always a place where sellers tended to be slower to reduce price. Longer days on market were more common. One question we find ourselves asking a lot around the office is what a new real estate normal will look like on island moving forward? Will we go back to typical Maui seller behavior pre-covid or will seller behavior more closely resemble mainland markets? It may take some time to determine the answer to that question.

Quick Sales

Another metric we started tracking earlier in the year is the percentage or properties that go under contract within 10 days of coming to the market. Of the homes and condos listed between July 1st and July 8th, 31.91% went under contract within 10 days of coming to market. That is actually up from June 14th-21st when only 25.37% of listings went under contract within 10 days of coming to market. That said, this is also the first time this year when the percentage of homes going under contract within 10 days was lower than the same period of 2019.

It is also worth noting that there is difference between the home and condo market. Of the homes listed between July 1st and July 8th, 23.53% went under contract within 10 days of coming to market. Of the homes listed during the same seven day period of 2019, 25.81% went under contract within 10 days. The condo market continues to see properties go under contract at a brisker pace. Of the condos listed between July 1st and July 8th, 36.67% went under contract within 10 days. That is just ahead of condos listed during the same seven days of 2019 when 36.11% went under contract within 10 days

Some Quick Thoughts on Current Conditions

It’s a strange market out there. Buyer demand is well below what we saw during 2021 and earlier this year with far fewer properties under contract. That said, inventory levels remain well below normal in most communities around the island. It’s likely that the lack of inventory is one reason why we aren’t seeing more price reductions.

It seems as if there is a little bit stronger demand in the condo market than the single family home market judging by the higher percentage of properties going under contract within 10 days. That comes despite a little more condo inventory coming to market.

Buyers will find conditions less competitive than earlier this year. However, well priced properties in areas and price points with low demand can still generate multiple offers. Overall, sellers can expect longer days on market and fewer buyers. Sellers should be particularly mindful of market conditions specific to their community and price point when pricing their property. It’s also worth remembering that negotiation and give and take is a lot more likely today than it was six months ago.

Wailea and Makena Market Overview

This is the first of a handful of features we will be doing in our market musings looking at specific communities on the island. Today, we are focusing on the resort markets of Wailea and Makena. Its worth noting that I used the term markets plural. While our MLS lumps the two areas together, the two communities have differences that make them unique. Wailea is significantly more developed with large hotels, a shopping center and a lot more neighborhoods and condo complexes. While expensive, the entry point for Wailea is much lower than Makena. Makena is smaller, less developed and has the highest concentration of high priced homes on the island.

Wailea Home Sales

This is a look back at single family home sale activity in Wailea during the first six months of 2022. These are some of the most notable numbers from that time.

  • Maui Realtors reported 17 homes sold in the Wailea Resort in the first half of the year. That is down 43% from the 30 sales reported during the first six months of 2021.
  • Inventory constraints played a significant part in the reduced sales. Decreased demand may be another factor in the second quarter of the year, but it is hard to say definitively.
  • Seven of seventeen sales closed for over asking price. Ten of seventeen sold for asking price or above. Demand was strong for the limited inventory available.
  • Nine of the seventeen sales were reported to be all cash transactions.
  • The median and average price of the homes sold in the first six months of the year is $2,800,000 and $3,478,441 respectively. This is actually down from last year when the median and average price of $3,475,000 and $3,973,168.
  • To be clear, the value of homes in Wailea did not depreciate this year. This shift in medians and averages stems from a difference in the composition of inventory sold. The chart below shows the difference between the first halves of 2021 and 2022. While there were still a fair number of sub-$2,000,000 sales in 2021, there was also a much higher volume of transactions for $4,000,000 and above in 2021. This stems in part from the much lower inventory of homes above $4,000,000 in Wailea this year.
This chart compares sales volume by price point in Wailea during the first half of 2021 and the first half of 2022.
Sales Volume by Price Point in Wailea during the first half of 2021 and 2022. All values on the bottom Axis are in millions.
  • The lowest priced home to sell during the first half of the year in Wailea closed for $2,270,000. That buyer purchased a 3 bedroom, 4 bath home with 2,562 square feet of living space and a pool in the Wailea Kai subdivision.
  • The highest priced Wailea sale during the first half of the year closed for $8,750,000. The home in Wailea Highlands includes 4 bedrooms, 7 baths and 8,657 square feet of living space on just under a half acre.
  • Wailea Golf Vistas experienced the most sales activity with 5 transactions. Wailea Pualani saw the second most sales with 4 transactions.

Wailea Condo Sales

The numbers below are some of the most noteworthy from the first six months of condo sales in Wailea.

  • Maui Realtors reported 77 condo sales in Wailea during the first half of the year. That is down 51% from the 157 sales reported during January-June of 2021.
  • Again, scarcity was a big factor in the decrease in sales. At one point in the first quarter, active Wailea inventory dipped to 6 condos. Some of the difference between the two years can also be attributed to new developer sales in Makali’i. The 2021 sales were boosted by 20 closes in Makalii based on contracts signed 2-3 years prior.
  • Of the 77 sales, 26 or 33.77% sold for over asking price. An impressive 54 out of 77 sales or 70.13% of all transactions closed for asking price or above. Again, this points to strong demand and competition for the limited supply.
  • Maui Realtors reported that 48 out of 77 or 62% of closed transactions were cash purchases.
  • The median and average prices of condos sold in Wailea came in at $1,630,000 and $2,408,720 respectively. The median price increased 20.91% and the average price increased 26.56%. These numbers reflect not only increasing values, but also a greater proportion of high priced transactions.
  • The lowest priced Wailea condo sale during the first part of the year closed for $650,000. That was for a studio unit in Wailea Ekahi.
  • The highest priced condo to sell during the first half of 2022 is located in Wailea Beach Villas. The ground floor unit in the D building closed for $12,500,000. The 3 bedroom, 3.5 bathroom unit includes 2,889 square feet of living space and a private plunge pool.
  • Wailea Ekahi and the Palms at Wailea had the most sales activity of any complex in Wailea Resort to start the year with 14 sales each.

Makena Home Sales

  • Maui Realtors reported 7 home sales in the Makena area during the first half of 2022. That is the same number as what was reported during the first half of 2021.
  • Two of the seven sales closed for over asking price. None of the homes sold for above asking. As you get to these price points, competition decreases and negotiation is more common.
  • The median sales price for the 7 Makena homes sold is $17,200,000. The average sales price came in at $18,825,564. That is a 72% increase in median sales price over last year’s $10,000,000 sale. It is a 35.94% increase over last year’s average sales price of $13,848,071.
  • This year’s low sale came in Makena came in at a $12,875,000. The oceanfront home in Makena Place includes 4 bedrooms, 4.5 bathrooms and 4,304 square feet of living space.
  • The highest priced sale in Makena and the highest sale on Maui for the year to date closed for $26,490,700. That estate includes 8 bedrooms, 8 bathrooms, 10,464 square feet of living space plus a pool house on an acre across the street from the ocean.
  • In terms of activity within subdivisions, two homes closed in Makena Place and two homes closed in One Palauea Bay.

Makena Condo Sales

  • Maui Realtors reported 9 condo sales in Makena during the first 6 months of 2022. That is down 36% from last year’s first half tally of 14 sales.
  • Two of the nine sales sold for full price. No sales closed for above asking price.
  • The median and average prices of the 9 condos sold are $4,000,000 and $4,950,645 respectively. Median increased 42.98% over last year’s median of $2,797,500. The average price increased 26.89% over last year’s average of $3,901,500.
  • The lowest priced condo transaction in Makena closed for $3,250,000 for a 2 bedroom, 2.5 bathroom 2,745 square foot unit at Na Hale O Makena.
  • The highest priced condo transaction in Makena during the first six months of the year closed for $11,256,000. That was a Molokini Residence at the Makena Golf and Beach Club with 5 bedrooms, 5.5 bathrooms and 4,430 square feet of living space.
  • Makena Surf saw the most sales activity during the first half of the year with 4 closes.

Wailea and Makena Market Outlook

Of course all of the sales referenced above reflect past market demand. The million dollar question, or twenty million dollar question in the case of some Makena residences, is what can we expect for the second half of the year? Surprising market behavior over the last two years makes any sort of prognostication a challenge and current economic uncertainty makes it that much harder. That said, it is worth at least touching on both the supply and demand side of the equation.

Wailea and Makena Inventory

On the supply side, there is still some variability by location and property type. There are currently 8 active home listings in Wailea with 4 pending. That is a pretty limited supply considering sales and current pending. It is worth noting that of that supply, a couple of sellers are reaching for some pretty big numbers for their respective neighborhoods. While record highs are normal of late, some of the prices are well above previous neighborhood highs. It is also worth noting that only 3 of 6 subdivisions have active inventory, and 5 of 8 listings are in Wailea Pualani.

There are currently 24 active condo listings in Wailea with 8 pending sales. A quick side note, the pending number does not include the 75 pending new developer sales at La’i Loa at Wailea Hills. This is up quite a bit from the 6 active listings on February 1. That said, it is still less than 2 months supply. Again, when honing in on certain condo complexes the inventory is particularly limited. There are six condo complexes with just 1 active listing and 5 condo complexes with no active inventory. It is also worth considering that 3 of the active listings are seeking prices well above all time highs in their complex. There are a number of other sellers seeking new high prices for their respective location or floor plan in their development.

There are currently 5 active home listings and 1 pending sale in Makena. That’s almost 5 months of inventory based on the first half of the year, but it is worth noting that the 7 sales during the first halves of 2021 and 2022 is pretty extraordinary activity. That makes the 5 active listings a healthy inventory for prospective buyers with the considerable means necessary to shop in this part of the island.

The Makena condo market inventory is literally zero. If you are looking for a place in one of the three condo developments or the Makena Golf and Beach Club, it is a waiting game.

The big unknown is what type of new inventory we may see through the end of the year. Inventory growth in July thus far is negligible.

What about Wailea and Makena Demand?

With Makena and Wailea predominantly second home markets, what type of demand will see from second home buyers in a shifting market? The amount of cash involved with transactions makes the market less sensitive, but not completely immune to increases in mortgage rates. Nationally, second home demand is down according to Redfin reports. What about some of the current market indicators we’ve used for the general market?

Of the eight properties listed in the area this month, two went under contract in less than 10 days or 25%. That is just a hair better than the overall Maui market. Of the current Wailea condo inventory, 29% of active listings reduced their asking price. For Wailea Homes, 28.57% of active listings reduced their price. For Makena Homes, 60% or 3 of 5 listings reduced their price. The Wailea numbers are below what we are seeing for price reductions island wide. The one caveat I might add is that historically, resort market listings are slower to adjust price. The Makena number is high, but it also is worth mentioning that pricing properties in the $10,000,000 plus range comes with its own set of challenges. These are large, very unique custom homes not as well suited to comparative valuations.

Monthly new pending home sales for all the years between 2017 and 2022 except 2020.

One last thing to mention is seasonality. Looking at the chart above, you can see that there is a general seasonality to the market in Wailea Home Sales with more properties going under contract during the first half of the year than the second. The same is true for Wailea condos. Makena is a little more random due to its small sample size. If the market follows typical behavior, we should expect less sales activity this year.

Based on all of the above, the Wailea and Makena markets should see less activity for the remainder of the year due to the combination of market trends, seasonality and limited supply. Barring a massive influx of supply and/or a significant worsening of the current economic situation, the limited supply should keep prices elevated.

You can search through the current inventory of Wailea and Makena Homes for Sale and Wailea and Makena Condos for Sale on our site.

A Little Maui Beauty to Brighten This Post

Contact The Maui Real Estate Team

Congratulations if you made it to the end of this post. It was a long one! It also must mean you are pretty interested in the Maui market. Feel free to Contact The Maui Real Estate Team with questions or for assistance buying or selling property on Maui. We would welcome the chance to be of assistance.

Pete Jalbert

Maui Real Estate Blog

Wailea Real Estate Market Update October 2021

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

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

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

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

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

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

Notable Numbers From the 2021 Wailea Condo Market

  • Maui Realtors reported 232 condos sold in Wailea between January 1, 2021 and September 22nd. That is a 362.5% increase over the 64 sold during the same period of 2020.
  • The median price of the 232 condos sold is $1,398,000. The average price is $1,910,153. That is 15.3% and 12.2% higher than last year’s median and average respectively.
  • The highest priced condo sale for the year to date closed for $14,000,000. This Wailea Beach Villas condo features 3 bedrooms, 3.5 bathrooms, almost 3,000 square feet of living space and a direct beachfront location.
  • The lowest priced Wailea condo sale for the year to date closed for $647,000. This is a studio unit at Wailea Ekahi.
  • I did a double take when looking at the data for the lowest priced condo sales in Wailea. I saw two closes at Wailea Point for $375,000 and $425,000 respectively. That is a shockingly low price for one of the more premium developments in Wailea. Closer examination revealed that the two seemingly low priced condo sales were for boat garages in the development.
  • According to MLS statistics, Makali’i was the busiest condo for sales thus far this year. It is worth noting that the majority of the 47 closes were new developer sales. These new developer sales were based on pre-construction contracts penned two to three years ago.
  • While closes at Makali’i juiced this year’s total sales volume based on older contracts, it is worth noting that quite a few properties went under contract in 2021 that won’t close until at least 2023. La’i Loa at Wailea Hills is the newest condo development in Wailea. Sales began in the spring of 2020. A roll out right at the start of Covid-19 blunted momentum. That said, it picked up steam in the fall of 2020. Strong demand in the first few months of 2021 resulted in the reservation of all 75 units by this spring.
  • Maui Realtors reported the most resales at Wailea Ekahi and Grand Champions. Both developments stand at 25 sales for the year to date.
  • Of the 232 sales, MLS records show 129 were cash transactions. That is 55.6% of the total sales. That is up from 47.9% over the same period last year.
  • Competition also increased significantly in the Wailea condo market. Of all of the closed transactions, 35 closed for over asking price. Over the same period of 2020, not a single transaction closed for over asking price.
The Wailea Point Condos saw more sales activity thus far this year than any other comparable span over the last 20 plus years.
An aerial shot of the Wailea Point condos flanked by the Four Season and Fairmont Kealani. Wailea Point saw more sales activity for the year to date than any comparable period over the last 20 plus years.

Thoughts on and Outlook for the Wailea Condo Market

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

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

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

Contact The Maui Real Estate Team

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

Pete Jalbert

Maui Real Estate Blog

Beautiful Home in Wailea Kai

The Wailea Resort is renowned for its beaches. Golden sand, clear waters and great conditions for swimming and snorkeling are a significant part of what has made the resort world famous. If you are looking for a single family home close to the beach , Wailea Kai puts you closer to the sand than any other subdivision in the resort. Keawakapu beach is 3/4 of a mile of sand perfect for swimming, walking or just enjoying Maui’s natural beauty. We have always liked Wailea Kai for this reason. That is why we are so excited to bring this great Wailea Kai home to market.

Keawakapu Beach is located across the street from Wailea Kai

This Wailea Kai home offers a lot more than just a good location. A 49 foot lap pool, over 1,000 square feet of lanai and deck space and a sunset/stargazing deck ensure that you will enjoy your time at home as much as you enjoy your time at the beach. There are a lot of other amenities and features above and beyond the aforementioned outdoor spaces.

The front elevation of 69 Pukolu in the Wailea Kai Subdivision

The entry to 69 Pukolu has an etched glass doorway

Etched glass doors make for a beautiful entrance to the home. When you walk through the front doors, you enter a soaring great room. The indoor/outdoor livability of the home becomes readily apparent with the living room’s pocket sliding doors that open the to the lanai. The main floor also includes the master bedroom suite, an office area, dining nook, powder room and the kitchen. The kitchen has granite counters, a top of the line convection oven, oversized refrigerator and other stainless steel appliances.

a pocket slider opens up from the living room to the covered lanai of this Wailea Kai Home

The kitchen of a home in Wailea Kai

The downstairs of the home includes three more bedrooms, a bathroom, another living room and a large storage room. The downstairs opens to the pool deck.

The pool and lanai area of this Wailea Kai Home

The 49 foot pool was built in 2014. Resistance jets add to your workout as you swim laps. That said, the pool is great for more than just laps. A large bench on the side of the pool is a perfect place to soak and cool off on a warm South Maui day.

Sunset from the rooftop deck of 69 Pukolu in Wailea Kai

The roof top deck literally and figuratively caps the home. It is a great place to take in the sunset and watch the stars emerge as day turns to night on another great Maui day.

This wonderful Wailea Kai home is offered for $1,650,000.  This home sold in 2019. Contact The Maui Real Estate Team for assistance with other homes in Wailea Kai.

Pete Jalbert

Maui Real Estate Blog

Wailea and Makena 2014 Year End Review and 2015 Outlook

After looking at the North Shore communities of Paia and Spreckelsville, we decided to head to South Maui for a look at the Wailea and Makena Real Estate markets. This is an overview of how this market performed in 2014 and what we may expect in 2015. Wailea is Maui’s most renowned resort community thanks in part to its beautiful beaches, three golf courses and luxury hotels and spas. Makena is the more understated of the two communities, but is arguably more exclusive with some of the island’s most expensive real estate. These are the notable numbers from the 2014 Wailea and Makena Real Estate Sales activity, a few thoughts on the 2014 market, followed by our thoughts on what to expect in these luxury communities during 2015.

This chart compares the real estate sales volumes for homes, condos and land in Wailea and Makena during 2013 and 2014

There were 32 homes sold in Wailea and Makena in 2014 with a median price of $1,892,000. In 2013, there were 29 homes sold with a median price of $2,750,000. That is a 10% increase in activity and a 31% decrease in median price.

There were 92 condos sold in Wailea and Makena in 2014 with a median price of $1,021,250. In 2013, there were 122 condos sold at a median price of $1,105,000. That is approximately a 25% drop in volume and an 8% drop in median price.

There were 7 land transactions in Wailea and Makena in 2014 with a median price of $1,550,000. There were 12 land sales in 2013 at a median price of $1,150,000. This is a 42% drop in sales activity and a 35% increase in median.

Notable Numbers from the 2014 Wailea and Makena Real Estate Market
While compiling the numbers above, I came across a few other numbers that were worth sharing.

  • Of the 32 homes sold, 7 were in Makena.
  • The high sale price for a home was $9,300,000 for an Oceanfront home in One Makena Place. This is the second year in a row that the highest priced sale was located in this gated enclave.
  • The Makena Place transaction was one of 15 sales over $2,000,000 and 6 sales over $5,000,000 that closed during 2014. In 2013, there were 14 sales over $2,000,000 and 7 sales over $5,000,000.
  • There was one sale under $1,000,000 in all of Wailea and Makena during 2014. The Wailea Kai home with three bedrooms, three baths and 1,766 square feet of living space sold for $890,000.
  • Wailea Fairway Estates was the subdivision in Wailea with the most sales activity with 6 closes in 2014.
  • The highest priced condo sold in Wailea and Makena during 2014 was one of the Villas at the Andaz Residences. This 3 bedroom, 4 bath condominium sold for $5,495,000.
  • The Andaz Condo was one of 26 condos that sold for $1,500,000 or more during 2014. There were 36 condo sales over $1,500,000 in 2013.
  • Grand Champions was the condo complex with the highest number of sales in 2014 with 12 total sales.
  • Only 2 of the condos sold were in Makena. Both of the condos that closed were at Na Hale O Makena.
  • There were 5 condo sales under $500,000 in 2014. In 2013, there were 2 condo sales under $500,000.
  • There were 5 REO or bank owned properties that closed in Wailea during 2014. That was the same as the 2013 REO sales totals for the area.

Thoughts on The Wailea and Makena Real Estate Market During 2014
There are a few things worth discussing from the 2014 Wailea and Makena Sales numbers. The dip in condo sales is certainly noteworthy. There was a decrease in condo sales island wide, but the 25% drop in Wailea outpaced the 11% drop throughout Maui County. It is especially interesting considering the fact that condos sales over $1,500,000 were up 9% around the island. There are no obvious reasons for the decrease in activity that jump out at me. With that in mind, I broke down the sales further to see if any plausible explanations appeared.

The first thought that came to mind was that there may have been a decrease in activity at the lower end of the market due to a contraction of inventory. That was something we were seeing in other geographic areas around the island. Looking at condo sales under $1,000,000 in Wailea, there was a 25% drop in total sales compared to 2013. However, when you look at condos sold between $1,000,000 and $1,999,000, there was a 38% drop in activity compared to the previous year. When you look at condos priced over $2,000,000, there was a 20% drop in activity compared to 2013. While it is possible the dip in activity below $1,000,000 may still be related to the contraction of inventory, what would explain the drop in activity in other parts of the market? It can’t claim to have definitive answers, but I have a couple of thoughts.

The dip in buyer activity in the $1,000,000 to $1,999,999 range may be a case of buyers deferring their purchase. There are a few different condo project that are expected to come to market in the Wailea market soon. Keala O Wailea and Makali’i at Wailea were both supposed to start pre-construction sales during the second half of 2014. Delays have pushed the initial sales sometime into 2015. There may be some buyers who opted to wait with the hopes of purchasing in one of the new developments verses purchasing at existing complexes like Kai Malu.

While the drop in sales was not as pronounced above $2,000,000, the dip was surprising nonetheless. There are a couple of factors at play that may have curtailed high end sales. Again, there may be competition from new developments. Makali’i may be causing some buyers to defer their purchase. At even higher price points, the Makena Golf and Beach Club may be causing some buyers to defer their purchases. The other factor at play is the draw of Montage in Kapalua. Traditionally, Wailea Buyers have been Wailea Buyers and Kapalua Buyers have been Kapalua Buyers. Even though they are both high end resorts on Maui, they tend to draw their own distinct clientele due to the unique personality of the resorts. When you look at the sales that have occurred at Montage, you are seeing quite a few buyers represented by Wailea area Realtors. It would appear that Montage is a property that has appeal to some traditional Wailea buyers.

The Wailea and Makena home market did not experience the same dip in activity as the condo market with sales exceeding 2013 totals. The dip in median home price does not reflect a decrease in values. It points to a shift in market activity with fewer high end sales and a few more homes sold in the $1,000,000-$2,000,000 range compared to 2013.

Activity in the the Wailea and Makena land market reflected the Maui Land market overall which saw a decrease in sales during 2014. The lack of sales wasn’t for lack of inventory. It is a question of where that inventory is positioned in the market. There was a lack of lower priced lots for sale. It also appears that the Ridge at Wailea, Wailea’s newest land development, may be priced above what the market is willing to support. There has only been one sale in the development since it came to market almost a year ago.

Wailea and Makena 2015 Real Estate Market Outlook
In our 2014 outlook, we anticipated that the Wailea and Makena Markets would be heavily impacted by the influence of new condo developments such as Makali’i at Wailea and Keala O Wailea. While some buyers may have deferred their purchases waiting for new developments scheduled to market, none of the new developments actually came up for sale. While we still don’t have definitive go to market dates for those two projects, the Makena Golf and Beach Club is starting to come on the market. This new development should have a big impact on the Maui Luxury market.

The Discovery Land Company’s Makena Golf and Beach Club is a significant new development. The area was in the initial stages of development during the last real estate boom only for the property to go into foreclosure during the downturn. The Wailea Beach and Golf Resort hotel, two golf courses and a total of 1,800 acres of land were purchased by consortium of AREA Property Partners, Trinity Investments and Stanford Carr Development LLC. The ownership group has chosen Discovery Land Company to spearhead a major redevelopment of the area that will occur in phases. Malauaka Estates is the first part of the development to hit the market. Maluaka Estates consists of eight oceanfront home sites with price tags ranging from $9 to $12 Million. Two of the Eight lots that hit the Maui Multiple Listings Service in the last month, and both are already under contract.

The existing Makena Beach and Golf Resort Hotel is being converted from a 310 room hotel into the Makai Residences. The Makai Residences will include 50 private residences ranging in size from 2,500 feet to 5,600 feet. Prices will range from roughly $6-$20 million range. The highest priced units will be far and away the highest priced condos sold to date on Maui.

In addition to the Makai Residences and Maluaka Estates, this phase of the Makena Golf and Beach Club will include the Kula Villas, Spa Hales and the Beach Cottages. The nine Beach Cottages will have 4 bedrooms, 4.5 baths and roughly 3,400 square feet of living space. Prices are anticipated to range from $9.5-$12 million. The 12 Kula Villas will be 3 or 4 bedrooms with sizes ranging from 2,950 to 3,900 square feet. Pricing is as of yet to be determined. The 5 Spa Hales are the smallest offerings in the resort to date. They will be two bedrooms and are likely to have the lowest entry point into the first phase of the Makena Golf and Beach Club.

Discovery also plans to create a a small village with a general store, restaurants, post office, retail space and a resort hotel. All residents will also be members of the Beach Club and have access to a variety of resort amenities.

The Makena Golf and Beach Club will be nothing short of the most significant new luxury development on the island since the creation of the Wailea and Kapalua Resorts. By all indications, the entry level price points will be significantly higher than either of those developments. It is tough to say what the impact will be on the rest of the Wailea and Makena market. The high price points will limit the impact on the lower priced properties in Wailea, while I suspect it may draw some buyers who would have otherwise been looking at some of the existing ultra luxury homes and condos within Wailea. This development also has the potential to attract buyers from some of the ultra high end resort communities on neighboring islands such as Kuki’o on the Big Island.

While we have spoken about the supply side of the market for 2015, we haven’t talked too much about demand. As it stands it appears that current economic conditions should favor a strong year for sales in Wailea and Makena. We may see a little less demand out of Canadian buyers due to the decrease in value of the Canadian Dollar.

You can check out the current inventory of Wailea and Makena Homes for Sale and Makena and Wailea Condos for Sale on MauiRealEstate.com You can also contact The Maui Real Estate Team if you are interested in buying or selling property in Wailea or Makena. .

Pete Jalbert