Mid-Year 2019 Sales Statistics
#1 question in real estate is..."How's the market?" The answer is, it depends on what market you're talking about?
What I seem to be hearing from most of the national sources is that a correction is overdue. It is not particularly clear what a "correction" is or what it means. If it is supposed to mean that prices are going to drop, I don't see that happening, at least not on Maui.
Why not? It's the most basic economic law in the book, supply and demand. The National Association of Realtors tells us that a "balanced' market has about 6 months of inventory. The inventory on Maui right now is about 4.8 months of homes for sale and only 3.9 months of condos for sale.
And, as you can see from the chart above, inventory (supply) has been shrinking since 2010. Mid-year 2010 there were about 1,700 condos for sale. Halfway through this year, at the end of June, we had just 476 condos for sale.
New listings for single family homes are actually up for the year with a 5.5% increase over 2018. However, demonstrating the demand side of law, the inventory of homes for sale is down 17% since January.
To illustrate the importance of which market we're talking about, of the 88 homes sold in June, 44 were sold for the median selling price of $750,000 or less. Currently, there are 91 homes on the market priced at $750,000 or less. So, for those hoping to buy a home at the more "affordable" end of the price range, there is barely 2 months of inventory available.
There is no indication of a price correction coming in the mid-price or low range of Maui's market for either homes or condos. Sales in both categories are dropping due to the aforementioned lack of inventory, and a large group of the population is being priced out of the market.
If you are thinking of selling, there is no time like the present. If you thinking of buying, I don't see prices coming down, but interest rates are still excellent. Remember, every 1% increase in interest rates reduces your buying power by 10%. Sharpen your pencil and keep looking for whatever will work to get you into the market.
Condos - Area and Regional Highlights
At mid-year the hot spot for condo sales by a wide margin was Kihei with 318 sales for the first half of the year. If you add the Wailea/Makena sales in with Kihei, it brings Maui's South Side up to 401 sales for the year, far outpacing Maui's West Side, which had only 289 sales during the same period.
For Kihei, the number of sales this year is almost identical to last year. Both the average and median selling prices are up significantly at 9% and 8% respectively.
Wailea/Makena has really dropped off. The number of sales is down over 35%. The average selling price is flat, but the median is up by 8% indicating a bit more activity at the higher end of the market.
On Maui's West Side, Kaanapali is the only area showing a decline in sales year-over-year. Inventory in Kaanapali is down. On the other hand, sales are up in the Kapalua, Lahaina, and the Napili/Kahana/Honokowai areas.
Napili/Kahana/Honokowai sales are up by almost 10%. A plethora of sales at the leasehold complex of West Maui Trades helped to depress the average selling price by 5%. However, the median selling price was stable with a 1% increase overall.
Sales in Maui's Central District, Kahului and Wailuku, dropped by over 20% as supply continues to shrink in Maui's most affordable place to live.
Wailuku had 68 sales, down by 23%. There are currently just 9 condos on the market in Wailuku. As you might expect the average selling price is up 22% and the median has skyrocketed well over 36%.
One final area of note is Maalaea. Sales at the second windiest harbor in the world dropped by 30%. But it wasn't because of the wind. Maalaea is really a nice spot, there just isn't much for sale there. The average price is up 11%
Single family home - Area and Regional Highlights
The area with the highest number of single family home sales was Wailuku. Kahului, the other city in the Central District had the 3rd most sales on Maui, making Central Maui the dominant district for home sales. Sales in Wailuku were down 7.5% with the average selling price up 7% and the median up just 2%. With a monthly average of 20 sales and only 48 homes for sale, there is just over 2 months supply in Wailuku.
Kahului sales were off by 24.5%, and both the average and median prices were down slightly. At the current pace of sales, Kahului has just enough inventory for 2.5 months.
With 83 sales, Kihei had the second most sales of any area. Sales were off by 6% with the average price down by 1.5%, but the median was up 19%. With 35 homes on the market, Kihei has enough homes to last for almost 3 months.
On the West Side, Lahaina sales are off by almost 6%, with selling prices down an average of 12.7% and the median price down 6% to $800,000. That said, there is exactly 1 (one) house for sale in the Lahaina area for less than $800,000. That house, by the way, is pretty much just a teardown.
In Kaanapali, sales are down by 43%. The average and median sales prices are virtually flat.
In Napili/Kahana/Honokowai areas, sales are up 20% with the average selling price also up 20%. The median was actually down 2%. Why was there such a difference? The average was skewed by a single sale of $9,000,000. Sadly, that was not my sale.
Kapalua sales are up with 11 sales this year compared to just 8 last year. The average selling price is off by a whopping 47% and the median is down 23%.
Other areas of interest include Haiku, where sales are down 10.5% and the median selling price is up by 6%.
In Kula, sales and the average selling prices are completely flat. However, the median price is up almost 11%.
Pukalani, also considered Upcountry, had a sales increase of 76.5%! The average selling price is up 14% to $766,530 and the median is up 5% to $724,000. They have enough inventory for 4 months.
Like its Upcountry neighbor, Makawao, also had a nice jump in sales of 42%. The median selling price was up just 3% to $680,000.
Be sure to visit us online at AlohaGroupMaui.com
A hui ho!
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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. 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.