Aloha, and say hello to a buyers' market. In this month's newsletter, we are going to dig into some of the details about what's hot and what's not in Maui's real estate market. We'll also do a quick update on the Lahaina recovery - there's progress, but it's still not where we want it to be. And, we have a little good news about Maui's visitor industry.
In Hawaii, in Governor Green's latest declaration, it was announced that properties mauka (mountain side) of Front Street that are also outside the erosion zone are being exempted from the SMA (Special Management Area) permitting process. And just in case you are wondering, most of Front Street north of Dickenson - including Fleetwood's, the old Longhi's, the Tommy Bahama's Marlin Grill, and the art galleries - are all in the erosion zone.
Was that really the intent?
This still leaves landowners on both the makai (oceanside) and mauka sides of Front Street in a state of confusion. Many of those property and business owners, including those at Front Street Recovery, want to rebuild. This is a National Historic Site. So, what will happen to all of these landmarks and places we love, like the Pioneer Inn, the Lahaina Yacht Club, and many others? That remains uncertain.
This is still a big deal because getting through the SMA process typically takes one year or longer based on personal experience and conversations with others who have gone through it. This exemption should mean that those planning to rebuild can start sooner. According to a release from Maui's Mayor Bissen, the exemption will affect 103 commercial properties and 533 residential properties, totaling 636 parcels.
Tourism Update
Again, good news, but we are still short of "normal." Tourism isn't fully back, but it is improving. Major short-term vacation rental management companies, including Aston, Kaanapali Shores, Maui Paradise Properties, and My Perfect Stays, are all reporting February occupancy levels in the mid-to-high 80% range. Lower rates, increased marketing, and record-cold temperatures on the mainland probably have something to do with our visitors arriving.
The number of visitors arriving in Maui in January was up 15.8% over January 2024. However, it is still down 13% from our last normal year, 2019.
Real Estate: It Ain't Nothing but Slow
How slow is it? Let's do the numbers.
Condos
It seems like supply and demand is always the story in Maui's real estate market. For condos, we've been in a buyer's market for a few months now.
Sales
Every month, we slide deeper into this buyer's market. In the last month, 50 condos were sold. Since October, we have reached 60 sales in only one month - back in November. In December, there were only 48 sales. We typically think of January through April as our high season. In January 2024, there were 92 condos sold. So, seeing just 50 sales close in February is a real indicator of how slowly this market is moving.
Inventory
The supply side of our equation has doubled in the last year. February 2024 ended with 408 condos for sale. At the beginning of this month, we had 839 condos for sale. The combined effect is that we have almost 17 months of inventory. We haven't seen anything like this since the Great Recession.
Even a blind man on a desert island can see that with this much supply and this little demand, prices will drop. Right? Wrong again.
Selling Prices
After watching median selling prices drop from $990,000 in September all the way down to $675,000 in January, prices shot up again to $945,000 in February.
We see a similar trend in average selling prices. It seemed that the average was stabilizing at around $1.1. million, give or take. The average selling price in January was $1,059,000 but then rocketed up to $1.358 million in February.
In February, there were 323 price changes for condos currently for sale. Of these, only 8 increased their asking price. All the rest lowered their prices.
For condos on Maui, there were 197 price changes - 192 of which were reductions. From the asking price at the time of sale, sellers got 94.5% of their asking price. However, from the original asking price, they got 92%
About 60% of the sales were condos that allow short-term rentals.
West Maui is a little different. There were only 16 sales in February. It has been worse - back in 2009 - but that's still pretty slim pickings.
Only two of those sales were in complexes that do not all short-term rentals. Of the 14 sales in properties that do allow short-term rentals:
- 10 were in hotel-zoned properties
- 4 were in apartment-zoned properties legally allowed to rent short-term
Pending Sales
Pending condo sales held steady with 87 pendings in February, compared to 89 in January. However, if we look at February last year, there were 179 pendings. Over the year, the number of pending sales has dropped - almost in half.
Single-Family Homes
The single-family home market has somewhat mirrored condominiums
- Sales dropped below 50 houses for the first time since November 2023
- Inventory peaked above 400 homes for the first time since May 2020
On the bright side, pending home sales rose above 100 again in February.
Other good news for sellers:
- The average selling price rose to almost $1.9 million again
- The median selling price also rose to nearly $1.4 million
The district with the most February sales was a bit of a surprise:
- Upcountry had 13 sales, edging out Central Maui, which had 12 sales
- The lowest median selling price was still in Central Maui, but there were also some good buys in Makawao
Surprisingly, the fewest home sales were in:
- South Maui - 5 sales (median price: $1.33 million)
- West Maui - 6 sales (median price: $3.4 million)
Conclusion
Most national real estate analysts predict a continued slow market. Interest rates are expected to remain in the high sixes to low sevens, so there is no relief there.
I believe condo prices will continue to decline, while home prices will likely remain stable - but at levels unaffordable for most full-time Maui residents.
What's the Solution?
- Invest in infrastructure
- Let builders build homes
- Encourage development
- Bring back visitors (AKA tourists)
That's my take on Maui, Lahaina, and the real estate market here on the greatest island in the world.
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.
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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), Anthony Freda R(S), Kathy Becklin, R(B), Becky Sparling, R(S), 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 2025 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.
