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Sales are the number of properties that actually closed escrow. These properties likely went under contract anywhere from 2 to 8 weeks before closing.
Home sales for September were surprisingly strong with 107 homes sold. Why so surprising? That's the highest number of sales in any single month since September of last year. Additionally, inventory is extraordinarily low.
Condo sales, with 84 closings, are also pretty strong, especially for September. Since the Hawaii quarantine started, condo sales have been slow, but they seem to have leveled off and sales are consistent.With our "opening" later this month, most of us are hoping, optimistically, that we will see some of that pent up demand demonstrate itself in the form of more condo sales.
Pending sales represent 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.
After reaching a high of 608 properties under contract in February of this year, we saw the COVID collapse in April when, just 2 months later, pendings fell 46% to a measly 327.
This month pendings broke 500 again. For homes there are 219 under contract, and 116 of those are on homes priced under $800,000. It seems like almost anything priced under $800,000 is going under contract.
The story for condos is similar. In February there were 306 under contract. By March pendings had dropped more than 50% and stayed down for 2 months in a row. The drop was due to many of those under contract being closed, and we had a fair number of buyers cancel, which also lowered the pending number. At the same time, buyers became cautious and we didn't see a lot of new contracts. Since May, we've seen consistent increase in new condo contracts.
Inventory tells us how many units are available for sale in each category.
Last month we reported that inventory is the biggest challenge we have in home sales. Inventory has declined steadily since December of 2018 when it peaked at 508 homes for sale. This month inventory fell again. We now have barely 3 months of inventory, indicating a solid seller's market. For homes priced at the median selling price and under, the numbers are even more striking. At the current rate of sales we have enough homes to last barely more than 1 month!
Condo inventory has gone the other way. February was our low point for condo inventory with 444 units for sale. That was a little over 3 months of inventory at the time, indicating a solid seller's market. That all changed in March and April. At that time we saw inventory start to rise. Sales peaked at 156 in March. In April it looked like the bottom was dropping out, when sales dropped to just 185.
Today, we have enough condo inventory for almost 9 months. That indicates a buyer's market, but most sellers aren't acting like it's a buyers market. At least not yet. Although we've seen sellers lower their initial listing prices and some are dropping prices at certain properties, examples being Aina Nalu in Lahaina, and Kamaole Sands in Kihei, most sellers are hanging in there and not accepting or settling for lower offers. I believe that many are seeing the October 15 opening as a ray of sunshine. We'll see.
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 median selling price for homes has held steady in the high $700's for the last 3 months. With the lack of inventory and continued low interest rates, I don't see the median price coming down in the near future.
The median selling price for condos did drop off significantly compared to the previous month. August's median was $591,000, but September came in at only $497,500. The median asking price for those that sold was only $499,000, so there wasn't much discounting off the asking price. More than half of the condos that sold are zoned for short term rental. However, those also sold for over the median asking price. The majority of the lower priced sales were in complexes that do not or are not allowed to have short term rentals.
Days of Market: (avg-sold listings)
The days on market (DOM) is the number of days property has been on the market until close of escrow.
We usually don't comment too much about days on market. But this month, there was a huge drop in the days on market for those homes and condos that sold, especially for condos. Why the change? I'm not 100% sure, but 41% of the condo sales were cash or 1031 exchange properties. Some closed in as little as 15 days. That's fast here on Maui. but, if you don't have to wait for lenders conditions and appraisals, you can move a lot faster.
This is interesting, we'll keep an eye on this to see if it's a one-time thing or if it is the beginning of a trend.
Thanks for reading. Also, check out our weekly report, the Maui Real Estate Market Report. It keeps you current on Maui's real estate, economic and lifestyle trend every weekend.