Aloha!

It's been an interesting week or so in economics for the U.S. As most expected, the debt ceiling crisis was averted, but the politicians still managed to freak out some of the markets, at least a little bit, before they got it done. The federal jobs report came in and reported there were more new jobs than expected, and higher unemployment than expected. The Fed hinted they may skip raising the fed interest rate in June. The stock market was up, and bonds were down.

Why do we care? Because it affects mortgage rates and, according to lenders we work with, rates dropped slightly toward the end of the week. Yay!

Taken together, those things affect consumer confidence. And since Maui's economic lifeblood depends on consumers confidently coming to Maui and consuming, it's important, or certainly should be, to anyone who owns a business, is employed, or collects taxes here on Maui.

And how's that working out right now? Well, the most recent information we have is the visitor spending data from April. Maui Now reported that visitor spending in April was up 36% over the same period back in the "normal" days of 2019. Interestingly, kind of like that confusing jobs report, the number of visitors to Maui in April this year was down compared to 2019, but they spent more.

I'm pretty sure a lot of those visitors, as well as a lot of folks who live here full time, would like to be spending money on Maui real estate. However, the new supply is not keeping up with demand. So...let's do the numbers.

SALES:

Sales are the number of properties that actually closed escrow. These properties likely went under contract anywhere from 20 to 8 weeks before closing.

The number of homes sold in May rose nicely to 74 closed sales. That is the highest number of sales closed in a single month this year. Given the other data, that's a little confusing. Home inventory, homes available for sale, has steadily declined since January. During the same period, pending sales, homes going under contract, have increased. It's kind of like the jobs report, confusing.

Condo sales were flat month over month. With inventory holding steady in the 2-month range, keeping sales in the high eighties is amazing and demonstrates how strong the Maui market for condos is, particularly vacation rentable condos. From a buyer's perspective, it seems like there is "nothing" for sale, but the actual number of sales tells a different story. Condos come on the market for sale and get sold quickly.

INVENTORY:

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

Inventory may not be the whole story, but it plays a huge role. The number of homes for sale has declined every month this year. In May, homes for sale dropped another 3%. That drop, along with increased sales, pushed our months of inventory back down to just 3 months. What is inexplicable is that pending sales for homes have risen fairly consistently this year from 103 in January to 135 in May, the highest number this year. That means that the number of homes that actually close in June should remain near that high May level.

Condo inventory actually had a little bit of a bump, rising 4% and giving us 200 condos for sale. With pending sales also rising slightly, we could see the current level of sales remain steady for another couple of months.

With 200 condos on the market, there actually is something for sale, but with 88 or 89 sales per month you can see that condos are selling quickly when they hit the market. That is consistent with last month's comment that condo sales will likely begin to slow down in late summer or early fall, unless we see more inventory come to market.

PENDING SALES:

A couple of Aloha Group Maui's current pending sales.

SELLING PRICES: average and median sold price

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 or very low priced sales.

Selling prices are not confusing. Given the high number of sales to the inventory level you would expect that prices would continue to increase, and you wouldn't be wrong. The average selling price for a single family home grew 19% over April's price and topped the $2 million mark for the second time this year.

The median selling price climbed 14% to $1,271,500. That is a new record high median price for Maui and could hold at that level for a while. The median asking price for the current 137 homes under contract, pending, is $1,273,000. Those are the homes that will be closing in the next couple of months. Also, the median asking price for a home on Maui is just under $2.2 million, and there are only 55 homes for sale priced at $1.75 million or lower.

While condo sales and prices remain strong, they did not set new records for selling prices. The average selling price for a condo dropped 11% to $982,904, dipping below $1 million for the first time this year.

The median selling price was also down by 5% to $835,000. However, since condos under contract that will be closing in the next couple of months have a median price of $1.4M it is reaonsalbe to expect that the median selling price will continue to rise in upcoming months.

We are happy to announce that we are returning to presenting our Real Estate Planning Seminars. In addition to Building Wealth and Creating a Legacy through 1031 Exchanges, we have added Senior Living Options, Planning for the Future and Beyond and, later this year, we plan to add a seminar for Trustees. We plan to make these or portions of them available online for those won can't make it to the live seminar. For more information, go to the Real Estate Planner tab on our website.

Save the date! Our next in-person 1031 Exchange Seminar will be held Thursday, August 10, we will provide more information on location and time as the date gets closer. If you would like to learn about a 1031 Exchange now, see below to watch a previously recorded version of our seminar.

If you have any questions about what is happening on Maui or any real estate questions, we'd love to hear from you.

A Hui Hou!

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), Heather Zidell, R(S), Magdalena Odonnell R(S), Sarah Twitchell 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 2023 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.  

Aloha,

It's May on Maui, and it's probably May where you are too. On Maui, May brings graduations, the beginning of wedding season, and, for us, the definite end of whale season. Although whales were reported being seen as late as last week, sadly, they will be on their way back to Alaska now. 

May is also considered to be one of our "shoulder" seasons. It is a space in time between our winter travelers who are here to escape from those cold places on the mainland, like the west coast, and summer visitors who come to enjoy Maui when the kids get out of school for the summer. 

In the olden days, the winter and the summer were both "high" seasons for Maui. No, not that high:). It meant there are a lot of travelers here. The hotels and condos, as well as the restaurants and the tourist activities were full. The shoulder season time meant there were fewer guests, higher vacancies, and Maui got a bit of a break.

These days, in the time of Al (don't get me started), the hotels and airlines have figured out how to adjust prices to lure price sensitive and bargain savvy travelers to the island. So, the island is still packed, and shoulder season is about as busy as any other season.

For those of us who live here, every day in May is just like every other day, another day is paradise.

____________________________________

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.

After an encouraging increase in March sales, home sales fell back to what the market and economic factors are dictating to be the current normal. There were 56 homes sold in May, which according to the Maui MLS means we have 4 months of inventory. However, with the median asking price for a home on Maui at $2.1 million and the median actual selling price at just $1.1 million, we might see the number of sales continue to decline. 

And when did you ever think you would hear someone say that a house would cost just $1.1 million?!?

For comparison's sake, the last time the number of sales was consistently as low as the beginning of this year, was the first few months of 2009. Back then the median selling price for a home was $567,000, and there were over 1,100 homes for sale. 

Condos also had an encouraging sales spike in March, but, as with homes, slid backwards in April. However, there were still 89 sales during the month, which is the second highest number of condo sales in any month so far this year. Pending sales have been holding pretty steady for a few months now, and inventory, although very low, has also been fairly steady. There is also a good match between the median selling price for condos, we we may see the same level of sales for a while. At least until we run out of condos for sale. 

Click here to see condos for sale on Maui.

____________________________________

INVENTORY:

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

The 241 homes for sale on Maui on May 1, is the lowest number of homes for sale this year. The highest number for sale wasn't much higher at 271 homes in both January and February. the 241 homes for sale translates into 4 months of inventory, which is still a seller's market. The current number of new listings is also down 37% compared to the same time last year. That would be another indication that home sales will remain low.

Click here to see homes for sale on Maui.

Condo inventory dropped below 200 units once again. That gives us just a tad over 2 months of inventory for sale, and with new listings down more than 43% from last year, it's hard to see sales continuing at the pace of the last 2 months. So, that thing I said about sales continuing at the same level - never mind. We can expect that sales will fall back to the 60 to 70 units we saw earlier this year. 

____________________________________

SELLING PRICES: average and median sold price

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 a home dropped $246,000 from March to April, coming in at $1,735,500. However, though the first 4 months of 2023 selling prices on Maui are still up 5.6%. If that seems like a "Maui thing", CoreLogic, a national real estate date company, reported that the average home price nationally was up 1% in the first quarter of 2023. The median price for a house in the USA at the end of April was $388,800.

The median selling price for a home on Maui dropped $78,500 month over month but remained above $1.1. million. There are currently 42 homes for sale in Maui County priced at $1.1 or below. The 3 lowest priced homes are all on the island of Molokai. The highest priced home on Maui is in Kapalua, priced at $41,900,000, and it has been on the market for 221 days.

The average selling price for a condo fell $56,000 month over month but remained above $1.1. million. The median selling price for condos is up 8.7% and the median price is up 7.2% this year as compared to last year. 

Click here to see what YOUR property is worth.

____________________________________

DAYS ON MARKET:

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

We don't usually report much on this data point unless there is an anomaly, and last month there was. In March the DOM for condos shot up to 260 days for condos sold. However, not to worry, April's DOM was back down to 115.

And since we brought it up... The average DOM for condos for sale has gotten out of the 80's. In 2021 the "normal" days on market was more like 140 days.

June starts our next busy season for real estate on Maui, that's just around the corner. If you would like to see all of the condo listings on Maui, click here, or home listings on Maui, click here. If you would like to know what your property is worth on Maui, or anywhere in the U.S., click here to get a FREE online estimate of value.

A Hui Hou!

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), Heather Zidell, R(S), Magdalena Odonnell R(S), Sarah Twitchell 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 2023 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.  

Aloha,

If you own property on Maui, you should have received your property tax assessment by now. Hopefully, you were sitting down (preferably somewhere like pictured above!) when you opened it. Anyone with even a passing interest in Maui real estate knows that prices have increased dramatically in the past few years. However, you might not have noticed that the assessed values did not increase much. The assessed value of one of my condos increased just 2.2% between 2020 and 2022. The market value was up about 50%.

The good news is that the assessed value is up only, if I can say "only", 31.5% in 2023. But even looking at the situation through rose colored glasses doesn't take the sting out of the chunk you new tax bill will take out of your household budget or the hit on the ROI for you investment properties. Price appreciation has slowed on Maui, as you will see in this report, but don't be surprised if your assessed value increase for next year is in the double digits again.

Interest rates have been a hot topic in real estate since they started escalating at the beginning of 2022 when the rate for a 30-year mortgage was at 3.2% according to Freddie Mac. By November, that rate was over 7%.

However, Sam Khater, Vice President of Freddie Mac said, "Turbulence in the financial markets is putting downward pressure on mortgage rates." That's good news, and rates have been coming down. Last week, according to Freddie, the 30 year fixed rates was 6.28%. Some of our Maui lenders are advertising 6% for conforming loans and 5.5% for Jumbo loans. We are even seeing condo-tel rates under 6% again.

And then there is the banking news, the Fed and an economy that keep sending mixed signals, but we can dig into that another time.

So much for the buzzy picture on the economic trends, what are the real estate trends on Maui?

______________________________________________________________________________

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.

Home sales rose to their highest level in 6 months with 72 sales. That was a 64% increase in month-over-month sales; however, sales are still down 30% as compared to March of last year. And last month's bump up may just be a blip on the radar. That's because leading indicators on the trend line such as pending sales and inventory both declined or remained flat for the month.

Condo sales had a big month with 119 sales. We haven't seen that many sales in one month since July of 2022. The 119 sales represent an 80% increase over the prior month, but it is still 35% below the same month in 2022. Pending sales for condos dropped significantly. Inventory was flat, and a long as it's not declining, I think we'll take that as a win.

______________________________________________________________________________

Pending Sales:

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

______________________________________________________________________________

INVENTORY:

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

The number of homes for sale dropped 6%, compared to the previous month. While 248 homes for sale is the lowest number in the last 6 months, the trend line is fairly flat going all the way back to July. And it's likely to stay that way as only 75 additional homes, new listings, came to market during the month and there were 72 sales. That keeps our monthly supply of inventory at about 3.5, so it is still a seller's market. 

Condo inventory remained at 210 condos for sale, the same as last month. There were 107 new listings added to the market, but there were 119 sales. So, unless there are significantly more new listings in April, we are likely to see the inventory get even tighter. With less than 2 months of inventory it is still clearly a seller's market for condos. 

______________________________________________________________________________

SELLING PRICES: average and median sold price

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 a Maui home shot back to almost $2,000,000. According to statistics published by the Realtors Association of Maui, that is up 9% over March of 2022 and 16.7% for 2023 year-to-date over 2022.

The median home selling price rose 11% from last month. It is also up 1.9% from last March. At $1,150,000 the median selling price for 2023 so far this year, is unchanged from 2022.

while both the average and median selling prices for condos were down compared to last month, they are still up for the year-to-date. Three months into 2022, the median selling price was $750,000 compared to $800,000 this year according to the Realtors Association on Maui.

______________________________________________________________________________

DAYS ON MARKET:

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

Days on market in one trend that seems to be running counter to all of the other trends. The average days on the market for a home to sell jumped 32% for the month form 102 days to 135 days. Part of that increase was due to 6 homes that finally sold after being on the market for more than 340 days. One of those homes has actually been on and off the market since 2004, when it was priced at $20,000,000. It sold in March for $20,750,000.

The days on market for condos to sell was also up, and by a crazy amount. By the count in the MLS the average time on market for a condo to sell was 260 days. What!!! Well, mystery solved. There were several closings at new condo developments that put condos under contract as far back as 2018 that just closed last month. That most definitely skews the average.

It does seem that it is taking longer, especially for single family homes, to sell. I'm hearing the same thing from my fellow brokers. I can tell you that historically we agents can usually feel changes in the market before they show up in the numbers.

The fact is that prices on Maui are continuing to rise. You might wonder what is keeping them on the rise? There are a few key factors. The supply of both condos and homes is so very low, and it is hard to envision that changing anytime soon. The economy remains stubbornly strong despite the Fed's best efforts to slow it down. Buyers seem to have mentally adjusted to  today's interest rates. And interest rates don't seem to affect 40%-45% of our buyers, as that is the percentage of buyers for homes and condos respectively who paid cash for their purchase last month.

See you next month.

Its always good to end with a sunset!

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), Heather Zidell, R(S), Magdalena Odonnell R(S), Sarah Twitchell 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 2023 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.