Aloha!

The first half of 2020 has been dramatically impacted by the COVID virus, with activity slowing considerably once the island was "shut down" with no travel, open houses, or non-essential activities. Up until that time, the market was humming right along with demand exceeding supply and prices continuing to inch upward.

Prices seem to still be holding up, but without rental income we're hoping our fellow owners can hold out. Since all rentals ceased in mid-March and showings are virtual only, there have been fewer sales and new listings. There is still buyer interest, but many are "on hold" until quarantine requirements are past or at least until buyers can visit the island again as guests.

Here's the breakdown for units sold in the 1st half of 2020:

The outcome for 2020 remains uncertain. The governor's date for mainland visitors to arrive without a quarantine requirement is elusive as COVID cases are spiking on Oahu and the US mainland.

Currently, we have our office on the ground floor near the gym, however, we've had to temporarily close since the COVID crisis. The office will open as soon as you and our visitors are welcome back to Maui.

During the 1st half of 2020, there were 10 sales. There was 1 property in escrow at the end of the six months. There was 1 expired listing that later came back on the market and sold. There were 2 cancelled listings, one of which is now back on the market. 

For further information on properties at Kaanapali Shores or anywhere on Maui, contact any of the Kaanapali Shores Team at info@kaanapalishoresteam.com. 

Aloha from your resident experts!

For all of the 2nd Quarter of 2020, we have been subject to COVID-19 quarantine and social distancing guidelines, with just a few visitors from other Hawaiian islands in the latter half of June. The town of Lahaina continues to be quiet, with some restaurants reopening for seated dining. There have been very few short-term rentals this quarter, resulting in zero income and continuing owner expenses such as electricity, taxes, insurance and AOAO fees.

This has shifted Aina Nalu's market quite a bit, resulting in unsold listings at the end of the quarter, lower prices and only one unit in escrow at quarter end - a 2 bed, 2 bath unit (C107) that closed escrow on July 6 with a much lower sales price of $505,000.

A one-bedroom unit that was in escrow at the end of the 1st Quarter (J106) fell out of escrow and is still listed at this time with 248 days on the market as of July 7.

Here is a summary of what happened in Q1 2020 vs. Q2 2020:

Units currently listed as of July 7 include:

As you can see, prices have dropped for 2/2 units. Last quarter's sales prices ranged from $575,000 to $599,000. Months with no rental income and continuing economic uncertainty have resulted in some owners liquidating their positions.

Interestingly, overall prices on Maui have not really fallen much at all this quarter, while condo sales have fallen. For more details on current Maui real estate prices and sales, click here MauiRealEstateMarketReport for the latest Maui Real Estate Advisor with all the stats. And watch your inbox for our weekly market update!

From April 1 to June 30, there were 9 listings and 0 closed sales. There were 0 cancelled listings and 0 expired listings at the end of the quarter. There were 8 active listings and 1 pending sale at the end of the quarter.

For further information, contact Lee Potts at lee@alohapotts.com or (808) 276-8776 or Barb Potts at barb@alohapotts.com or (808) 344-5008. 

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Aloha Group Maui is a team headed by L. Lee Potts, MBA, REALTOR® R(B) and Barbara S. Potts, MBA, REALTOR® R(B) and former California CPA. 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 – and we do it with Aloha! 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 Real Estate Professionals.

Lee Potts holds an MBA and was the President of an international software company. He was also the Marketing VP of a publicly traded company and has been investing in real estate since right out of college.

Barbara Potts holds an MBA, was a CPA with Ernst and Young, held a financial management position at Apple, was Director of Strategic Marketing for Grass Valley Group (a division of Tektronix), was a business broker in California, and has always been a real estate investor.

We would be honored to represent you with a purchase, sale or 1031 Exchange of Maui real estate. If you’re in Lahaina Town, stop in and see us - our office is across the street in Dickenson Square, in Suite 212.

Copyright 2020 L. Lee & Barbara S. Potts
Statistical information in this newsletter is based on actual sales information reported to the Realtor’s 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.

Sales:

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

Home sales rebounded from a significant drop in May. While they are still below the average number of sales per month for the beginning of the year, it looks like home sales will get back to pre-COVID levels in the next month or so. Make sure to read about Pendings and Inventory below.

Condo sales rose slightly from the May level, but they are still off 50% from February and almost 60% from March. Kahoma Village and Honua Kai's Luana Gardens accounted for 14% of condo sales. Those condos are new developer offerings and went under contract before building had even started in some cases. That was long before anyone even heard of COVID-19. In fact, one of those units was under contract for 807 days before closing. I wonder if those would have all sold in today's market?

Pending Sales:

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

Pendings had dropped all the way down to 327 in April after topping out at 608 in February. Now we're back up to 442, which is about a 35% bump. The real story is home pendings. This month pending sales of single family homes rose to 204. The average number of pendings in that category for the last 12 months is 196. Real estate slow down? What real estate slow down?

That's easy, the slow down is in condo sales. Although pending sales rose to 174 in June, that is still 29% lower than the average number of condo pendings for the 12 months prior to COVID.

Inventory:

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

If you haven't heard me say this before, I'll say it again. In planning for our business for 2020 I was nervous. I expected sales to be way down. But I thought sales would be way down due to lack of inventory. Well, I was kind of wrong. Here's what I mean.

Based on actual sales and pending sales, home sales look like they are coming back to normal. When COVID hit, we, and the national experts, thought home sales wouldn't be significantly hurt due to the high demand and the lack of supply. The inventory of homes for sale dropped in June to just 396 units. Barbara, AKA "The Boss", has been keeping Maui month end totals on a spreadsheet since July 2013. This month has the lowest number of homes for sale in over 7 years. It's supply and demand, folks!

And you could probably see this coming. Condos are the other side of the coin. This month the number of condos for sale hit 584. That really doesn't sound like that many units, in fact, at the current rate of sales that's only 8 months of supply. With 6 months of inventory being considered a balanced market, 8 months' worth tilts slightly in favor of buyers. However, it is notable that 584 units for sale is the highest number of condos for sale since March 2018.

Selling 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 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 dropped back under the $800,000 mark this month. The average for the previous 12 months was $770,000. So, a median selling price of $757,750 is within the range of normal fluctuations for Maui home prices.

For condos, inventory is up, sales and pending sales are down. Said another way, supply is up, demand is down. So, what would you expect prices to do? If you look at our 6 month chart it would be easy to conclude that prices are on their way down. But April and May had a number of closings in the $2 million plus range at Honua Kai's Luana Gardens, which skews the numbers. If we look at the 12 months pre-COVID we see something quite different. The average of the 112 months pre-COVID is $517,000. So, are prices for condos really drifting down? Maybe, but we'll need to keep watching to say for sure.

Days on Market:

The days on market (DOM) is the number of days a property has been on the market until close of escrow. There have been some modest spikes, but we're not really seeing the DOM fluctuate that much really.

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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 our 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: Angie Liu R(S), Beau Dyer R(B), Cheri Miller R(S), Keri Nicholson R(S), Paul Goodman R(B), Suni Novotny R(S), and Tony Brow R(B). We are business people, 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 on 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 fi you are buying property on Maui, it is 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 with both Steve's were there (Job and Woz). She was also Director of Strategic Marketing for Grass Valley Group, a division of Tektronix, and a business broker in California.

Lee, Barbara and the team are licensed under Keller Williams Realty Maui.