The Latest From Our Blog

This is where you can find out more about what's new at Aloha Group Maui - new homes for sale, new condos for sale, video tours, 3D tours, price adjustments, open houses, our community involvement, and Maui fun!

 

April 12, 2022

Maui Real Estate Advisor ~ April Real Estate Statistics

Is Maui's real estate market crashing or cruising?

As most people who are even tangentially following real estate prices know, the value of your investment(s) literally started to skyrocket in late 2020. In 2021 real estate prices continued to climb, and now 3 months into 2022, people are wondering what is happening, and what can we expect to happen?

For months clients and some folks outside the real estate industry have questioned just how long prices can increase and even raised the specter of the ever dreaded "bubble'. They cite fears like increasing interest rates and potential foreclosures.

The law of supply and demand is alive and well on Maui, and across the US for that matter, but let's focus on Maui. We have less than 2 months' worth of single-family home inventory and less than one month of condo inventory. That means that it is still a strong seller's market. We are currently seeing multiple offers on our listings and are competing against multiple offers with our buyers, with no slowdown in sight.

Interest rates are up. According to Freddie Mac, the conventional fixed rate for March was 4.17%. The rate for the same month in 2019 was 4.27%. The rate did drop in 2020 and 2021, but we are still at historically low rates. Just for some perspective, the average rate back in 2006 and 6.41%. Additionally, about 40% of the sales on Maui are cash sales and don't have a direct effect on what the buyer can afford.

Why are we not going to have a bubble? The bubble that was created leading up to the Great Recession had 2 factors that we don't have today: over-supple and easy credit. Getting back to supply and demand, it was a buyers' market from 2007, when supply was 9.6 months inventory, through 2010 which reported 8.5 months inventory. Credit was also being given away for very little down and no real credit checks. Anyone who has applied for a loan in the last few years can attest those lenders are being quite strict these days.

So, we have:

  • No bubble likely
  • Historically low inventory
  • Still historically low interest rates

To give you a little more perspective, we've compared the most recent trend for the 6 months ending in March 2022, to the same 6-month period ending last year, 2021, to see if we can spot any trends.

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SALES:

Sales are the number of properties that actually closed escrow. These properties likely went under contract anywhere from 2 to 8 weeks before closing.

The sales of single-family homes on Maui for the last 6 months have fluctuated from a low of 85 in February to a high of 118 in December, and we averaged 101 sales per month over that time frame. For the same 6-month period ending in March of 2021, we averaged 103 sales per month. That is a difference of just under 2% year over year.

In March we had 181 condo sales. That was the highest number of condo sales in a one-month period since August of 2021 with 186 sales. August of 2021 was also the end of a summertime surge that consisted of 5 straight months of 200+ condo sales per month. However, for the 6 months just ended compared to the same 6 months in 2021, we averaged 6 sales per month higher this year.

Why is this important? These sales levels have persisted in spite of a consistent lack of sustained inventory and steadily increasing prices. Some folks are talking about a shift in the market. We don't see that in a comparison of year over year sales.

What are we seeing in the other key data point?

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PENDING SALES:

Pending sales represent the properties that are under contract but have not yet closed. Pendings are the pipeline that tell us how many sales are likely to happen in the next couple of months.

A comparison of the average number of pending home sales per month for the same 6 months in 2021 vs. 2022 is similar to the comparison of sales noted above. The average number of homes under contract in a month for those 6 months leading up to March 2021 was 237, in March of 2022 it was 210. That is a decline of 11% year over year.

However, March of 2021 had the highest number of home sales in a single month on Maui ever. After that home sales declined slowly until December and have rebounded slightly so far this year.

For the past 6 months ending in March 2022, compared to the same period in 2021, there was a significant increase in the average monthly number of pending condo sales from 237 to 351. However, the tale is in the trend.

For the 6 months ending in March of 2021, the number of condo pendings skyrocketed from 218 in October, to 456 in March. However, we saw condo pendings begin to drop last April all the way through September which ended with 295. Since October, condo sales have come back over to 300 per month and finished in March with 368 units.

A few recent Aloha Group Maui pending sales.

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INVENTORY:

Inventory tells us how many units are available for sale in each category.

Inventory is always the story. It is half of the equation of the most basic economic law: supply and demand. The trend in inventory is a mirror image of the trend for sales and pending sales, reversed.

The home inventory dropped like a rock from 320 homes in October 2020 to just 206 in March of 2021. That is an unprecedented 36% decline in the number of homes for sale. March 2021 was the first month we dropped below 2 months of home inventory. We haven't been over 2 months' worth of homes for sale since.

Condo inventory has been even more dramatic. The number of condos for sale during that time dropped from 733 in October to only 348 at the end of March. That's a 53% drop. Wow! We saw that 6 months run start with a balanced market of 6 month inventory in October of 2020 and jet into a seller's market with one and a half months of inventory last month. 

In March 2022 with 181 sales and 141 condos for sale, we have about 3 weeks of inventory.

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SELLING PRICES: Average and median sold prices

We look at Average and Median prices in all categories. A lot of people like to know the average price; however, we tend to use median for most of our analysis, because the median is less likely to be skewed by outliers of a few very high priced or very low priced sales.

The trend line for home prices rose over the 6-month snapshots we've been reviewing. The median selling price for a home in March of 2021 was $975,000. The average of the monthly medians for the 6-month period was $909,500. But wait, there's more. The median selling price in September of 2020 was $779,500 and the next month the median was $880,000. That was an increase of over $100K! Selling prices rose almost another $100,000 during the next 6-month period. Just imagine what it was like for buyers who were preapproved for a loan at $800,000 during that time.

This March the median selling price was up to $1,128,396. As of today, there were only 22 homes on Maui priced under $1,000,000.

As with other data points, condos are more dramatic. For the 6 months ending in March of 2021, the median was just under $582,000 and oddly, the median selling price for the month 6 months earlier was $581,000. The prices even dropped a little for the next 5 months, but in March of 2021, the median price went to $645,000.

It has gone nowhere but up since then. The median selling price for March this year hit an even $800,000. Interestingly, if you look at the trend you can see that October's median was a fairly pedestrian $672,500 and stayed in the low $700's through February.

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DAYS ON MARKET: avg-sold listings

The days on market (DOM) is the number of days a property has been on the market until close of escrow.

What can we say? The average days on market continues its downward trend.

It remains to be seen what affects inflation will have on the real estate market. It's been going on for months with little change in the market. Also, Russia's assault on Ukraine could have a negative effect on inflation and the supply chain. Let's hope for the sake of the Ukrainian people and the rest of the world that nightmare ends soon.

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Get more information and details

To get more information on property and trends, you can search all properties listed for sale at www.AlohaGroupMaui.com.  If you can’t find what you’re looking for there, send us an email to lee@alohapotts.com, and we’ll do our best to get an answer for you.  As we get more requests for information, we’ll add new sections to the website, newsletter or both.

 

About Aloha Group Maui

Aloha Group Maui was founded by L. Lee Potts, MBA, REALTOR® R(B) and Barbara S. Potts, MBA, REALTOR® R(B) and former California CPA. Our team consists of talented professionals; Cheri Miller R(S), Suni Novotny R(S), Keri Nicholson R(S), Myra Plant R(S), Anthony Freda R(S), Courtney Stice, R(S), Kathy Becklin, R(B), and Tony Brown R(B). We are businesspeople, and we treat our clients with the same care and service attitude that we would like to receive when we do business.  We are in business for pleasure and profit.  We expect that most of our clients will enjoy the property they own in Maui (pleasure), and it would be nice for everyone if your property performs well for you (profit).  Real estate can be highly speculative, and profits are never guaranteed.  So if you are buying property in Maui, it’s a good idea to surround yourself with a professional team.

 

Lee Potts is the former President of an international software company and former Marketing VP of a publicly traded franchise organization.  Lee and Barbara are both licensed under Keller Williams Realty Maui.  

 

Barbara Potts was a CPA with Ernst and Young before joining Apple Computer back when both Steve’s were there (Jobs and Woz).  She was also Director of Strategic Marketing for Grass Valley Group, a division of Tektronix, and a business broker in California.

 

Copyright 2022 L. Lee Potts

Statistical information in this newsletter is based on actual sales information reported to the Realtors Association of Maui, Inc.  While this information is deemed reliable, it is not guaranteed.  This newsletter is for informational purposes only and not intended as advice for investment or any other purposes.  Real estate is considered to be highly volatile, and purchasers and sellers of real estate should always seek expert outside advice before investing.  

 

April 11, 2022

Aina Nalu News ~ Q1 2022

Aina Nalu News

Presented by Aloha Group Maui

Issue 66, Q1 - 2022

Here we are in 2022! What a ride the past two years have been, and speaking of, if you've driven on the island in the past month or so, you know that things seem to be back to normal! The mask mandate on Maui ended March 25, and it looks like the airline mask mandate is set to expire on April 18. We suspect that will bring a few more visitors to the island.

Inventory is still the hot topic on Maui, or lack thereof as the case may be, and Aina Nalu is no exception. As soon as a unit hits the market, it is shortly under contract, usually with multiple offers that have been above asking price in many instances. Units are selling for record prices.

There are 3 units that are still pending, with one that closed at quarter's end.

As you can see, prices have increased considerably. The best comparison is probably between I201 in Q1 2022 and I203 in Q1 2021, a difference of $240,000 in just a year!

As for the real estate market overall on Maui, the inventory level is still at historically low levels, but at least it hasn't declined in the last few months. On the other hand, the market is still hot for properties in desirable areas, such as Aina Nalu. 

From January 1 to March 31 there were 10 listings and 6 closed sales. There were 0 cancelled listings, and 0 expired listings at the end of the quarter. There were 0 active listings and 4 pending sales at the end of the quarter.

 For more details on current Maui real estate prices and sales, go to the Maui Real Estate Advisor for all the stats. 

March 24, 2022

Daily Dose of Vitamin Sea ~ March 24, 2022

Update from Maui ~ your daily dose of "vitamin sea"

Aloha!

We are looking forward to tomorrow at midnight when the mask mandate is lifted! It finally feels like we're taking small steps in getting back to normal and we are excited to be able to see everyone's smiles again!

That being said, we also certainly respect those that feel safer still wearing a mask. COVID numbers are way down, and the trend seems to continue to head that direction, but we all know how quickly things can change again!

We hope everyone is well and that wherever you are, the weather is starting to feel like Spring!
We had the opportunity to go on a sunset sail a few nights ago as a team, and as always it was spectacular. The sails were up, the sun was setting on one side and the moon was rising on the other. Did I mention the whales?!? It was just about perfect.

As always, we would love to answer any questions, or just catch up. Feel free to call or email us anytime!
 
"The sun is setting in a burnt orange sky; the cliffs are black silhouettes; the sea, liquid silver."
~ Laura Treacy Bentley
Posted in Community, Maui Fun
March 4, 2022

Daily Dose of Vitamin Sea ~ March 4, 2022

Update from Maui ~ your daily dose of "vitamin sea"

Aloha!

March has started off with a bang!

First, Governor Ige announced that the Safe Travels program will end effective March 25, 2022. No word on whether or not Hawaii will be lifting the indoor mask mandate, but things are moving in the right direction! 

Second, for only the second time in 40 years, a Maui high school team has won the Division II State Basketball Championships (Lahainaluna won in 1982). Congratulations to Maui Preparatory Academy for their first ever team state championship in an undefeated 17-0 season!
And lastly, the whales are still here. That is cause to celebrate every month of whale season!!
Check out the peck slaps around minute 4!
On the real estate front, things are still pretty hot here on Maui. We have seen a whole spectrum of emotions; from the joyful celebration of getting an offer accepted to the disappointment of yet another offer being rejected. We are so thankful to a part of whatever real estate journey you are or have been on, but wanted to offer some tips, and maybe some hope, to those that are still looking for their piece of paradise.

6 Insider Tips for Winning Real Estate Offers in 2022 

As always, we would love to answer any questions, or just catch up. Feel free to call or email us anytime!
 
"The future is like a daytime moon, a diffident but faithful companion, so elegant as to be almost invisible, an inconspicuous marvel."
~ Robert Grudin
Posted in Community, Maui Fun
Feb. 24, 2022

Maui Real Estate Advisor ~ February Real Estate Statistics

The real estate market is HOT, but sales are sagging.

We'll talk about that in a minute. First, what's happening on Maui?

COVID Mandates

Most COVID mandates are likely ending soon. Lt. Governor Josh Green, reported that he and other state leaders are "cautiously optimistic" that most COVID-19 mandates could be lifted by the end of next month. He cited an 83% drop in cases for Hawaii. He said the Safe Travels program is set to expire on March 25.

New Affordable Housing Project

A new 752 unit affordable housing project is being proposed. It would be in Waiehu, near Wailuku. It would include a mix of multi-family and single-family homes.

In addition, Developer Mike Atherton is hoping to break ground on a new housing development in Waikapu that would be a mix of affordable homes and larger rural lots. 213 of the homes in the 500 home development would be slated as affordable housing. Read more about this long awaited housing project

Whale Mania

February is the height of whale season here on Maui. And, just in case you're missing them, here are a few links to our whale watches.

January Whale Watch

Whale Season on Maui 1.0

And a favorite from a friend a few years ago.

A Close Encounter with a Humpback Calf

25 Mile West Maui Bike and Hike Trail Proposed

MauiNow reports there is a lot of interest in plans to create a 25-mile bike and walking trail. The trail will run form Ukumehame to Lipoa Point in West Maui. Several organizations, including the Maui Metropolitan Planning Organization, the County of Maui, and Alta Planning and Design are collaborating. 

Now let's do the numbers.

 

SALES:

Sales are the number of properties that actually closed escrow. These properties likely went under contract anywhere form 2 to 8 weeks before closing.

Home sales sagging in January, dropped 23% from December. Low inventory, steadily increasing pries, and competition have kept some buyers from getting the home they wanted. Ninety percent of the homes listed for sale today are priced over $1,000,000 and most are on the market less than 14 days.

Condo sales also dropped in January, just over 9%. It also appears that pricing and inventory may be stabilizing a bit. The inventory level is still at historically low levels, but at least they didn't decline during the month. On the other hand, the market is still hot for well-priced properties in desirable locations.

If you are thinking of buying, you might be interested in our new blog post, 6 Insider Tops for Winning Real Estate in 2022.

 

PENDING SALES:

Pending sales represent the properties that are under contract but have not yet closed. Pendings are the pipeline that tell us how many sales are likely to happen in the next couple of months.

While actual closed sales for homes dropped in January, as did inventory, the number of homes going under contract increased over 6%. As we see new listing come to market, we also see that they go under contract in less than 2 weeks in most cases. That indicates that the buyers are ready and are acting quickly.

The number of condos under contract remained steady in January, as did inventory. However, the number of condos pending is still more than two and a half times the number of condos for sale. And the 346 condos pending right now are the second highest number of pending sales in the last 6 months.

 

INVENTORY:

Inventory tells us how many units are available for sale in each category.

The number of homes for sale dropped slightly, just over 3%, in January. January was also the sixth month in a row the there were less than 200 homes for sale. The 177 homes for sale amounts to less than 2 months of inventory. However, for buyers shopping at the median price point of $1,160,000 or less, the supply is much lower than the demand.

The supply of condos for sale remained virtually flat at 138 condos. This is actually the highest inventory level in the last 6 months. Wow! How does that compare to January of 2021, a mere year ago? Way back 12 months ago there were 577 condos for sale. 

 

SELLING PRICE: average and median sold prices

We look at Average and Median prices in all categories. A lot of people like to know the average price; however, we tend to use median for most of our analysis, because the median is less likely to be skewed by outliers of a few very high priced or very low priced sales.

The average selling price for homes rose over 7% to just under $1.7 million. Even with that jump, it is still far lower than the 6 month high of just under $2 million established back in November of 2021.

The median price rose over 5% for the month reaching $1,160,000. The median selling price, which we believe is a better measure of how the market is trending, has risen steadily after a drop off in September. The difference is the median home price from January 2021 to January 2022 is 17%.

The average selling price for a Maui condo dropped 15% compared to last month. However, it is still almost $1 million and the median rose slightly. So, there might be some stabilization in condo pricing, however, when there are still more condos selling every month, demand, than the amount of active inventory, supply, there will still be upward pressure on prices.

DAYS ON MARKET: arg-sold listings

The days on market (DOM) is the number of days a property has been on the market until close of escrow.

Although the stats indicated that the number of days on market for homes have increased there may be an explanation that isn't really market related. Several homes in new developments closed. Since the buyers were under contract well before the homes were finished, the days on market are showing well over 300 days. There was also a house that had been on the market for 1,085 days. Those have an effect on the average.

DOM for condos went the other way, dropping to under 100 days. That might indicate a lot of cash closings since cash sales can close more quickly than financed offers. And, about 45% of last month's sales were cash sales.

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Get more information and details

To get more information on property and trends, you can search all properties listed for sale at www.AlohaGroupMaui.com.  If you can’t find what you’re looking for there, send us an email to lee@alohapotts.com, and we’ll do our best to get an answer for you.  As we get more requests for information, we’ll add new sections to the website, newsletter or both.

 

About Aloha Group Maui

Aloha Group Maui was founded by L. Lee Potts, MBA, REALTOR® R(B) and Barbara S. Potts, MBA, REALTOR® R(B) and former California CPA. Our team consists of talented professionals; Cheri Miller R(S), Suni Novotny R(S), Keri Nicholson R(S), Myra Plant R(S), Anthony Freda R(S), Courtney Stice, R(S), Kathy Becklin, R(B), and Tony Brown R(B). We are businesspeople, and we treat our clients with the same care and service attitude that we would like to receive when we do business.  We are in business for pleasure and profit.  We expect that most of our clients will enjoy the property they own in Maui (pleasure), and it would be nice for everyone if your property performs well for you (profit).  Real estate can be highly speculative, and profits are never guaranteed.  So if you are buying property in Maui, it’s a good idea to surround yourself with a professional team.

 

Lee Potts is the former President of an international software company and former Marketing VP of a publicly traded franchise organization.  Lee and Barbara are both licensed under Keller Williams Realty Maui.  

 

Barbara Potts was a CPA with Ernst and Young before joining Apple Computer back when both Steve’s were there (Jobs and Woz).  She was also Director of Strategic Marketing for Grass Valley Group, a division of Tektronix, and a business broker in California.

 

Copyright 2022 L. Lee Potts

Statistical information in this newsletter is based on actual sales information reported to the Realtors Association of Maui, Inc.  While this information is deemed reliable, it is not guaranteed.  This newsletter is for informational purposes only and not intended as advice for investment or any other purposes.  Real estate is considered to be highly volatile, and purchasers and sellers of real estate should always seek expert outside advice before investing.  

 

Feb. 14, 2022

6 Insider Tips for Winning Real Estate Offers in 2022

Tactics from the trenches from Aloha Group Maui.

Getting the property you want under contract is job #1. That puts you in control and gives you options and time. 

If you are hearing from friends and the media that there is "no inventory", they are wrong! There were a record number of real estate sales last year on Maui and 2022 is off to a red hot start. 

Question: How could there possibly be a record number of sales if there was no inventory? 

Answer: That couldn't happen

The fact is, there is inventory, it just doesn't sit on the market very long, and sometimes it never even gets to the market in the MLS.

So, how do you win in a competitive market? Here are 5 insider tips from one of the most successful real estate teams in Hawaii.

1. Be first 

Today, real estate is a team sport and this is no time to be shy. Be PREPARED, be BOLD, and be FAST. Remember, the market is moving faster. That means if you are getting a loan to buy a property, be pre-qualified, and have your proof of cash for your down payment ready to show the seller.

If you happen to spot a new property before your agent notifies you - call immediately. Yes, we look at the new listings many times a day, but you could still be the first to spot something you like.

Get your offer in as quickly as possible, first if you can. As listing agents, when we receive more than one offer on a property, we give extra consideration to the first offer that comes in. It shows that the buyer is serious and their agent is on top of it. In a hot market, neither sellers nor their agents want to waste time with potential buyers who appear to just be testing the waters.

If you are afraid of being first, remember the story of the early bird and the worms.

 

2. Pricing

Afraid of making an offer over the asking price? Lean on your agent and the data, and be prepared to make an offer over asking price if it's warranted and you really want the property.

How much over asking price do you need to go? Good question. It varies based on the desirablity of the neighborhood or condo complex and property condition. It might surprise you to find out that on average, about half of the properties are selling for over asking price. If the property you want is in the half that are going over asking, you can expect the selling price to be 1% to 9% over the asking price.

Your agent can give you guidance based on comparable sales and what she/he can tell you about their sense of the trend for that type of property in your desired area. If you like the property, probably someone else will too, and they will likely offer over asking. So, it's wise to quickly pick a number that you are comfortable with.

If you afraid of overpaying, take comfort in the fact that prices are still on an upward trajectory, and the price you pay today will likely be lower than the price for the same property next month.

 

3. Escalation clause

What is an escalation clause? If you are really, really afraid of overpaying but you really, really want the property, the escalation clause may help you to hedge your bet.

The Escalation Clause language is "Buyer is aware and understands that there are or could be multiple offers on this property. Should Seller receive a bona fide offer prior to the acceptance of this contract at a net offer price (excluding any seller concession to the buyer) higher than this offer Buyer hereby agrees to increase his offer price to an amount equal to $XXXX more than the highest competing offer, up to a maximum offer price of $XXXX. Seller agrees to provide the buyer with a copy of any such offer for verification."

These are commonly used in today's market. Do they work? Sometimes. An escalation clause is better than nothing, but if you really want that property, it's smarter to make your highest and best offer first.

 

4. Cash is King 

If you can find a way to pay cash it makes your offer stronger. When a seller receives 2 offers that are identical except one is cash and the other is financed, they are likely to go with the cash offer because there is more certainty it will close. We have had several clients find ways to pay cash by getting a home equity line of credit (HELOC), getting short term funds from retirement accounts and some lenders have programs that allow you to get prequalified for an immediate cash out refinance for those who have enough cash but prefer not to tie it all up in one place.

 

5. Appraisal

If you are getting financing, your lender will require an appraisal, and will only make the loan to you if the property appraises for the full amount of your offered price. 

You may have heard of situations where buyers "waive" the appraisal. Well, they don't really "waive" the appraisal. They agree to come in with enough additional cash, the difference between the contract price and the appraisal price, to get the lender to approve and fund the loan.

Typical Appraisal language would be - "The buyer agrees that should the property appraise for less than the price offered and agreed to, the buyer will put down enough additional cash for the down payment to secure the financing detailed in this contract." 

If that sounds too scary, you can limit the amount of additional cash you are willing to bring in to get your loan.

This is an important clause because appraisers use sold comparable properties from history. While they can do minor adjustments for the rising market, appraisals are often lower than sold prices.

If you are still afraid of overpaying based on just the appraisal, the price trend is probably protecting you. And the house that doesn't appraise today will likely appraise in another couple of months.

A bonus tip if you are getting a loan is to use a Maui based lender. Getting a loan for a property on Maui is just like getting a loan anywhere else in the U.S., only different. There are nuances that out of state and sometimes even off-island lenders miss. When that happens, the loan falls through and the deal goes south. A local lender with a good reputation is going to give the seller's agent more confidence that the loan will go through and gives your offer a better chance of being accepted.

 

6. "AS-IS"

In about 90% of the offers we see an AS-IS Condition Addendum which is used to tell the seller that you intend to purchase the property in the condition it is currently in.

Why would we recommend you agree to purchase AS-IS? What if there is something wrong with the property? In Hawaii, the Purchase Contract is very buyer-friendly, and our AS-IS does not eliminate any of your rights or options. You can still do your inspections, you can still review all pertinent real estate documents, you can still do anything you would do in the normal process with the AS-IS, including your right to terminate the contract and get your deposits back under any of the 7 to 9 applicable contingencies in the Purchase Contract.

What you are telling the seller is that you are not going to nickel and dime them with issues; my favorite example being from an inspection report where the inspector noted that one of the kitchen drawers did not glide smoothly. However, true big issues, such as safety issues, the roof, plumbing, electrical, and the like are still on the table. 

Your agent and brokers are skilled at crafting and presenting offers. As noted, the Hawaii Purchase contract is very buyer-friendly with contingencies to help protect you once you get under contract. Your #1 job is to get the property under contract. We'll be right beside you all the way.

 

For more information click on the links below.

For updated market conditions

For our buying process

For 4 Things You Need to Know Before Investing in a Condo on Maui

If you are Canadian...

Jan. 20, 2022

Maui Real Estate Advisor ~ January Real Estate Statistics and More!

And the COVID weirdness continues, but we are still optimistic. Welcome 2022!

Last year at this time we got off to a more optimistic start on Maui. Our COVID numbers were way down, there was a vaccine on the horizon, planes were flying, visitors were arriving, and the real estate market survived 2021.

Not only did the real estate market survive, but it was HOT coming into 2021, and by April it was clearly on fire, and inventory was on the decline.

During the final months of 2020, condo inventory exceeded 700 units for sale. In April of 2021, we saw less than half that many condos available on the market. Single family homes for sale had dropped from over 330  at year end 2020 to barely 200 in April 2021. And pending sales in April exceeded an eye popping 900 units. 

By June, Maui was almost back to something approaching a new normal. However, tourists were arriving in droves, rental cars were almost non-existent, restaurants and bars were limited to 50% capacity with the 6 foot distancing rule, and tour operators, also at 50% capacity, were maxed out.

Visitors who couldn't go to their favorite restaurants or attractions were cranky. Locals, who had had the islands to themselves, were overwhelmed by the new crowds, and that made them cranky. But we all were making it through and remained optimistic.

And then came Delta, and I don't mean the airline. A lot of us were very concerned about another potential shutdown. Thankfully, that didn't happen. State and county officials kept the already existing rules in place. Delta started to drop off and officials started to loosen restrictions. Restaurants were allowed to go to 100% capacity with no 6 foot rule.

Then came Omicron. We have the highest number of COVID cases in Hawaii that we've ever had, and we're still open. Real estate is still rocking and 22 is my lucky number. The whales are here now in large numbers and they are jumping like crazy. 

My crystal ball says we may be through this variant by the end of March, and there won't be any more of them. By April, we'll start to see a little more inventory. Prices will not go down, but we won't see as many bidding wars and multiple offers, which will be a little bit better for buyers, but still good for sellers.

What else is happening in real estate right now? Let's look at the numbers. 

SALES:

Sales are the number of properties that actually closed escrow. These properties likely went under contract anywhere from 2 to 8 weeks before closing.

I thought it might be interesting to look back at the end of 2019, seemingly the end of normal, and compare that to the end of 2021, hopefully not the new normal.

In December of 2019 there were 457 homes for sale and 96 were sold that month. In December of 2021, we had only 183 homes for sale. Which was 60% less inventory, and yet, there were 188 sales, 23% higher.

Condo inventory at the end of 2019 was a healthy 482 units. With the first wave of COVID, condo inventory, unlike single family home inventory, surged to almost 750 units by mid-2020. There were 123 condo sales made in the last month of 2019. With travel restrictions in 2020, condo sales slumped to as low as 51 units one month. However, as travel restrictions eased at the beginning of 2021 sales jumped to record highs, exceeding 200 units per month for several straight months.

PENDING SALES:

Pending sales represent the properties that are under contract but have not yet closed. Pendings are the pipeline that tell us how many sales are likely to happen in the next couple of months.

Pending sales at the end of 2019 were 499 units, including 180 homes and 251 condos. At the end of last year, with home inventory 60% less than 2019 and condo inventory less by 72%, pending sales are up in both segments.

However, we are seeing the number of pending sales declining, most notably for single family homes, where the number has dropped slightly month by month since July.

Condos, however, have remained fairly strong finishing the year with 344 pending, yet there haven't been more than 136 units for sale in any month in the last 6 months.

A few Aloha Group Maui pending sales that were under contract within 3 weeks or less of listing.

INVENTORY:

Inventory tells us how many units are available for sale in each category.

It seems like we have covered inventory pretty well. I will just note that in the not too distant past, inventory for both homes and condos steadily ran in the 450 - 550 range. It will be quite some time before we see that level again.

SELLING PRICES: average and median sold prices

We look at Average and Median prices in all categories. A lot of people like to know the average price; however, we tend to use median for most of our analysis, because the median is less likely to be skewed by outliers of a few very high priced or very low priced sales.

Continuing the 2019 vs 2021 theme, the average selling price for a home back in 2019 was just over $1,000,000 and the median selling price at the end of the year was $740,000.

In the last 6 months of 2021, the average selling price has fluctuated wildly from as low as $1,200,000 up to $1,980,000. The median selling price seems to have settled in at around $1,000,000.

The average selling price for a condo 2 years ago was just over $660,000. In the final months of 2021 the average selling price was over $1,000,000 in 5 of the final 6 months. The median selling prices is up from $514,000 to $700,000.

No matter how you look at it, if you've owned since 2019 or before, you've gained a lot of equity.

DAYS ON MARKET: avg-sold listings

The days on market (DOM) is the number of days a property has been on the market until close of escrow.

In the last few months we've seen some of the lowest days on market ever. This shows us how sales and pending can remain so high, while inventory is so low. There is inventory, but it comes and goes really fast. 

A word about what's ahead.

Demand is still high and interest rates are still near all-time lows. However, increased prices and even the modest interest rate increases we've seen will dampen the enthusiasm of some would-be buyers.

So, does that mean that prices will come down? No.

I don't see any indication of that happening on Maui. On a national basis most of the big names with crystal balls, Fannie Mae, MBA, and so on, think we will still see appreciation in the 4% range.

So, if you are a potential seller, the good news is that you've gained a lot of appreciation and prices aren't likely going down.

If you are a buyer, the good news is that prices aren't increasing as rapidly, interest rates are still near all-time lows and you will likely face less competition when you make an offer. 

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Get more information and details

To get more information on property and trends, you can search all properties listed for sale at www.AlohaGroupMaui.com.  If you can’t find what you’re looking for there, send us an email to lee@alohapotts.com, and we’ll do our best to get an answer for you.  As we get more requests for information, we’ll add new sections to the website, newsletter or both.

 

About Aloha Group Maui

Aloha Group Maui was founded by L. Lee Potts, MBA, REALTOR® R(B) and Barbara S. Potts, MBA, REALTOR® R(B) and former California CPA. Our team consists of talented professionals; Cheri Miller R(S), Beau Dyer R(B), Angie Liu R(S), Suni Novotny R(S), Keri Nicholson R(S), Myra Plant R(S), Paul Goodman R(B), Anthony Freda R(S), Courtney Stice, R(S), Kathy Becklin, R(B), and Tony Brown R(B). We are businesspeople, and we treat our clients with the same care and service attitude that we would like to receive when we do business.  We are in business for pleasure and profit.  We expect that most of our clients will enjoy the property they own in Maui (pleasure), and it would be nice for everyone if your property performs well for you (profit).  Real estate can be highly speculative, and profits are never guaranteed.  So if you are buying property in Maui, it’s a good idea to surround yourself with a professional team.

 

Lee Potts is the former President of an international software company and former Marketing VP of a publicly traded franchise organization.  Lee and Barbara are both licensed under Keller Williams Realty Maui.  

 

Barbara Potts was a CPA with Ernst and Young before joining Apple Computer back when both Steve’s were there (Jobs and Woz).  She was also Director of Strategic Marketing for Grass Valley Group, a division of Tektronix, and a business broker in California.

 

Copyright 2022 L. Lee Potts

Statistical information in this newsletter is based on actual sales information reported to the Realtors Association of Maui, Inc.  While this information is deemed reliable, it is not guaranteed.  This newsletter is for informational purposes only and not intended as advice for investment or any other purposes.  Real estate is considered to be highly volatile, and purchasers and sellers of real estate should always seek expert outside advice before investing.  

Jan. 11, 2022

Aina Nalu News ~ Q4 2021

Aloha from your resident experts!

Did anyone else blink and 2021 was over?!? We were hopeful that it would be a better year, and for real estate it certainly was, perhaps even better than we had expected.

Inventory has picked up a little bit in the last quarter, demand for units at Aina Nalu has remained strong, and prices have only continued to increase.

If there is any doubt that it is a Seller's Market, C204, a 2/2 upstairs unit sold in Quarter 1 for $540,000. In Quarter 4, a 2/2 upstairs unit just a few doors down, closed at $700,000. That is a price difference of $160,000!

As you can see, prices are increasing on all units, not just the 2/2 in a great location. As COVID continues to rear its ugly head in apparently an unending chain of variants, it seems more and more people are looking for some place to escape that can also be used as an investment property. As things remain a little uncertain in short-term rentals on Maui, Aina Nalu will only continue to be in demand.

As for real estate overall on Maui, inventory for condos remained steady through Quarter 4. That is pretty amazing since we're selling that many or more each month.

From October 1 to December 31 there were 11 listings and 6 closed sales. There were 0 cancelled listings, and 0 expired listings at the end of the quarter. There were 2 active listings and 3 pending sales at the end of the quarter.

For more Maui real estate information, check out our Maui Real Estate Advisor.

Jan. 11, 2022

Daily Dose of Vitamin Sea ~ January 10, 2022

Update from Maui ~ your daily dose of "vitamin sea"

Aloha!

Happy Monday! It was the Sentry Tournament of Champions in Kapalua this past weekend. So if you like golf, this was definitely the weekend to be on Maui. The weather was PERFECT, crystal clear skies, sparkling turquoise water, slight breeze and whales jumping. 

Despite this silly Omicron variant, it was a nice break to be outside enjoying "normal" life. It was especially nice to see everyone's smiling faces, you forget sometimes, when you're at Costco with your mask on, that connection is important, even with those you don't know.

Have a fantastic week and we hope to see you all soon!
 
View from around hole 11.
 
View from around town ;) !
Posted in Community, Maui Fun
Dec. 29, 2021

Daily Dose of Vitamin Sea ~ December 29, 2021

Update from Maui ~ your daily dose of "vitamin sea"

Aloha!
Hau'oli Makahiki Hou! (or Happy New Year). We hope everyone enjoyed their Christmas and was able to relax with friends and family. 

As always, stay safe and we would love to hear from you!
 
We went from this, to...
...this!
 
We got to experience the other side of life this holiday season!
 
There are so many beautiful spots to find up North!
Posted in Community, Maui Fun