Is the real estate market returning to normal? We'll fill you in on that and more, but first the other news in Hawaii and on Maui specifically is...
Sports - Hawaii wins the Little League World Series. Film at 11.
Cuisine - The first Chick-fil-A opened on Maui. The blessing was held on September 1 and they are donating $25,000 to the Maui Food Bank. The notice in The Maui News said the owners will be supporting other charity events and giving back to the community.
Visitors - The first humpback whale of the year was spotted in South Maui last week! It is pretty early, so there may not be another spotting for another month or so, but it marks the start of our favorite season.
Now, what is happening in this crazy real estate market?
It seems the press has all but pronounced the real estate market as dead. That is certainly not the case on Maui for single family homes. Although the sales trend since March is clearly moving in a downward direction, it's not dying, it's just getting back to normal.
Normal! How can you say that?!?
A little recent history is useful. I think most of you will agree that 2019 was the last "normal" year we had. Throughout the first 8 months of 2019 there were 708 homes sold. Throughout the first 8 months of 2022 there have been 743 homes sold. There have been 5% more homes sold during a time when interest rates more than doubled, and we have 66% less inventory, and prices are much higher than in the normal times. Also, the average number of sales per month for the first 8 months of 2019 was 88.5. Look at the average number of sales for the last 3 months of this year. It looks like home sales are on the path to normal.
Condo sales in 2022 are also up over the norm for 2019, however, the number of sales per month for this year dropped significantly, like a proverbial rock, in July. It is difficult to see how condo sales can keep a normal pace of about 130 sales per month when inventory is about half of what it was in 2019 and prices have risen a whopping 65%.
Make no mistake, it is still a sellers' market. Inventory hit bottom in November of 2021 when there were just 163 homes for sale on Maui. In April of this year there were just 165 homes for sale. In August, the number of homes for sale was up 100 homes over that low inventory mark. Yeah!
Well, maybe not "yeah!" In August of 2019, the normal year, there were 459 homes for sale. That was also a sellers' market because the inventory during that time was 4.5 months. A balanced market is 6 months of inventory. We are back up to 3 months of inventory on Maui.
And just for fun, during August of 2008, when the real estate market and everything else crashed, the number of homes for sale was 1,176. What a time!
For condos it is also a sellers' market. Even with inventories up over the last 3 months we still have less than 2 months of condos for sale. Just to give you an idea how different the market is today, in August of 2019, when there were 156 condos sold, there were 459 for sale. Even then, there was just 4 months of inventory.
SELLING PRICES: average and median sold prices
The median selling price for a home dropped below $1,000,000 for the first time since October of last year. In fact, the median price for this August was lower than August of 2021. However, the median selling price year-to-date is still up 15.1% over 2021 and 50% over 2019.
You can look to the luxury market to find the reason for the price decline in August. The luxury market, homes prices $3,000,000 and up, peaked during April and May this year. There were 16 luxury home sales in April followed by 15 in May. The average selling price for a luxury home in May was $7,575,000. And, of the 16 homes sold in April, all but one were sold for cash.
Condos are a different story. Prices and sales are up this month. Inventory is down. More than half, 53 of 103 of the sales, were cash sales.
Overall the median price for a condo is up 20% from the same period last year. The areas with the biggest gains include Lahaina, up 48%, Kaanapali, up 50%, and a bit of a surprise, Molokai, up 51.6% with 38 sales.
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 email@example.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.