This is our seventeenth Maui Market Musings. This edition continues to focus on the metrics that give us the best indication of current market conditions. Those three metrics are inventory, price reductions and how quickly properties are going under contract. Discretion was the better part of valor and I am going to hold off on my Kapalua market update for either the next musings or a stand alone post. I imagine people have more to do over the holiday weekend than reading a 3,500 word manuscript on the Maui Real Estate Market. Without further ado…
End of Month Inventory of Maui Single Family Homes
| 6/30/22 | 7/31/22 | 8/31/22 | ||||
| Active | Pending | Active | Pending | Active | Pending | |
| <$750,000 | 6 | 16 | 11 | 14 | 11 | 11 (-3) |
| $750,000-$999,999 | 32 | 63 | 25 | 62 | 31 (+6) | 44 (-18) |
| $1,000,000-$1,499,999 | 43 | 37 | 65 | 34 | 58 (-7) | 28 (-6) |
| $1,500,000-$1,999,999 | 44 | 22 | 41 | 19 | 46 (+5) | 13 (-6) |
| $2,000,000-$2,999,999 | 34 | 15 | 31 | 19 | 36 (+5) | 12 (-7) |
| $3,000,000-$4.999,999 | 27 | 10 | 25 | 9 | 32 (+7) | 11 (+2) |
| $5,000,000-$9,999,999 | 23 | 8 | 24 | 7 | 26 (+2) | 5 (-2) |
| $10,000,000-$19,999,999 | 13 | 0 | 12 | 0 | 11 (-1) | 0 |
| $20,000,000+ | 4 | 1 | 5 | 1 | 5 | 0 |
| Totals | 241 | 169 | 239 | 156 | 256 (+17) | 124 (-32) |
| 6/30/22 | 7/31/22 | 8/31/22 | ||||
| Active | Pending | Active | Pending | Active | Pending | |
| Haiku | 20 | 13 | 22 | 11 | 20 (-2) | 7 (-4) |
| Hana | 4 | 2 | 4 | 1 | 8 (+4) | 2 (+1) |
| Ka’anapali | 11 | 7 | 10 | 7 | 10 | 4 (-3) |
| Kahului | 8 | 27 | 13 | 21 | 11 (-2) | 25 (+4) |
| Kapalua | 5 | 3 | 5 | 1 | 4 (-1) | 1 |
| Kihei | 45 | 22 | 48 | 14 | 44 (-4) | 16 (+2) |
| Kula | 25 | 13 | 19 | 16 | 24 (+4) | 10 (-6) |
| Lahaina | 20 | 18 | 18 | 14 | 23 (+5) | 7 (-7) |
| Makawao | 13 | 12 | 14 | 9 | 15 (+1) | 11 (+2) |
| Napili/Kahana/Hono… | 12 | 3 | 10 | 6 | 14 (+4) | 4 (-2) |
| Pukalani | 12 | 7 | 7 | 6 | 8 (+1) | 5 (-1) |
| Spreckelsville/Paia | 11 | 2 | 10 | 2 | 15 (+5) | 3 (+1) |
| Wailea/Makena | 13 | 4 | 15 | 5 | 16 (+1) | 4 (-1) |
| Wailuku | 39 | 33 | 39 | 35 | 41 (+2) | 22 (-13) |
End of August Home Inventory Review
The information above is provided with the usual framework. The home inventory data by price point includes all of the island of Maui, but excludes the islands of Molokai and Lanai. The district information is limited to the districts with the most activity.
- The inventory of active home listings on Maui actually increased approximately 7% since the last day of July. This comes on the heels of a decrease in active listings in July.
- Active inventory decreased in only two price ranges.
- Pending sales dipped again. Pending listings are 21% lower than the end of July and 27% below the end of June.
- Pending sales increased in only the $3,000,000 to $4,999,999 price range.
- Looking at the different price ranges, the $750,000-$999,999 price point stands out. Through the market boom of the last couple of years, you could make an argument that this was among the most competitive price points. Needless to say, this is a very different market now. The increase in interest rates reduced affordability for local buyers, and many investors seem to be sitting on the sidelines. As of today, 56% of the active listings in the range reduced their asking price at least once. Sellers are needing to adjust their price to the new realities of the market.
- Looking at the different communities around the island, the month to month shifts in the trajectory of inventory are notable. A number of places where inventory increased between June and July, decreased between July and August and vice versa. I would suspect we might continue to see this pattern moving forward.
- Kihei home inventory is notable for it’s month to month decrease after steady and significant growth in active listings over the previous months.
- Resort market inventory saw limited changes in active inventory. Ka’anapali and Kapalua both have one fewer active listings while Wailea has one more.
End of August Maui Condo Inventory
| 6/30/22 | 7/31/222 | 8/31/22 | ||||
| Active | Pending | Active | Pending | Active | Pending | |
| <$250,000 | 2 | 8 | 1 | 8 | 1 | 6 (-2) |
| $250,000-$499,999 | 19 | 25 | 11 | 23 | 14 (+3) | 17 (-6) |
| $500,000-$749,999 | 31 | 40 | 43 | 39 | 34 (-9) | 43 (+4) |
| $750,000-$999,999 | 44 | 46 | 44 | 43 | 33 (-11) | 43 |
| $1,000,000-$1,499,999 | 29 | 30 | 30 | 31 | 29 (-1) | 31 |
| $1,500,000-$1,999,999 | 28 | 34 | 30 | 33 | 24 (-6) | 35 (+2) |
| $2,000,000-$2,999,999 | 20 | 36 | 20 | 36 | 22 (+2) | 38 (+2) |
| $3,000,000-$4,999,999 | 11 | 25 | 12 | 18 | 12 | 19 (+1) |
| $5,000,000-$9,999,999 | 11 | 3 | 10 | 3 | 8 (-2) | 1 (-2) |
| $10,000,000+ | 3 | 0 | 4 | 0 | 4 | 0 |
| Totals | 199 | 247 | 205 | 234 | 181 (-24) | 233 (-1) |
| 6/30/2022 | 7/31/2022 | 8/31/2022 | ||||
| Active | Pending | Active | Pending | Active | Pending | |
| Ka’anapali | 23 | 15 | 24 | 13 | 25 (+1) | 16 (+3) |
| Kahului | 4 | 3 | 2 | 8 | 3 (+1) | 7 (-1) |
| Kapalua | 12 | 9 | 10 | 10 | 11 (+1) | 6 (-4) |
| Kihei | 55 | 74 | 67 | 60 | 50 (-17) | 63 (+3) |
| Lahaina | 16 | 5 | 16 | 8 | 9 (-7) | 10 (+2) |
| Ma’alaea | 5 | 5 | 5 | 6 | 3 (-2) | 6 |
| Napili/Kahana/Hono | 48 | 34 | 40 | 34 | 45 (+5) | 25 (-9) |
| Wailea | 23 | 85 | 25 | 82 | 24 (-1) | 86 (+4) |
| Wailuku | 12 | 12 | 14 | 13 | 9 (-5) | 14 (+1) |
End of August Condo Inventory Review
Again, the tables above come with the usual framework for our end of month inventory. The table by price point includes all condos on Maui, but it does not include condos on the islands of Molokai or Lanai. The table with districts is limited to the communities with the most activity. Pending sales at La’i Loa at Wailea Hills skew the data in Wailea and the $1,500,000-$5,000,000 price ranges. There are 75 pending sales in that development based on contracts penned in 2020 and the first quarter of 2021. Pending sales in La’i Loa won’t start to close until sometime in 2023. Paradise Ridge Estates in Kihei also skews the data albeit to a lesser extent. There are 18 pending sales with that development based on contracts penned between 2018 and the first quarter of 2022. Those should start closing in the not too distant future.
- After steadily increasing over the last few months, active condo listings at the end of August dropped 12% from the end of July.
- Pending condo sales were virtually unchanged with only one fewer pending sale at the end of August compared to the end of July.
- Looking at the data by price range, active inventory only increased between $250,000-$499,000 and between $2,000,000 and $2,999,999. The biggest drops in active inventory occurred between $500,000 and $999,999 followed by $1,500,000 to $1,999,999.
- Kihei continues to be one of the more dynamic communities when it comes to inventory. Much like Kihei Home inventory, Kihei Condo inventory dropped significantly since the end of July. That comes on the heels of seeing the largest increase over the months prior. Pendings increased as well. Without doing a really thorough comparison of the month to month inventory, it’s hard to say if this is variability or sellers adjusting their pricing and buyers responding.
- The Napili, Kahana and Honokowai condo inventory took the opposite trajectory from Kihei with pending sales dipping substantially and active listings increasing on the month.
- The change between the end of the month active inventory in the resort markets was nominal. Wailea’s active inventory increased by 1 and both Kapalua and Ka’anapali decreased by 1. Pendings increased in both Ka’anapali and Wailea while the Kapalua pending sales dipped.
One final thing worth noting about home and condo inventory, September 1 marks something of a seasonal shift on Maui. Labor day is the end of our summer tourist season. Traditionally, real estate activity on island slows a little in the early fall. This is a time when some sellers take a break from the market. Eleven home and condo listings either cancelled or expired on September 1 after the numbers for the charts above were compiled. We also tend to see a little less in the way of new inventory. One would think that would be the case this year, but there are fewer certainties in this day and age.
Checking in On Price Reductions
Nationally, there is some discussions of price reductions starting to level off after steady growth over the last few months? What about Maui? Looking at the inventory as of September 2nd, 42.97% of all active home listings reduced their price one or more times. On August 15th, 39.67% of active homes reduced their price. On July 4th, that number stood at 34.03%.
In the condo market, 27.84% of all active listings reduced their price. That is actually a decrease from 29.62% on August 15th. For further context, 24.63% of the active condo listings had a reduced asking price on July 4th.
It’s worth noting, that some parts of the market have more price reductions than other. There is a fair amount of variability in the market by district and price point. One example being homes in the $750,000-$999,999 price range which I mentioned earlier.
How Quickly Are Things Going Under Contract?
Another metric that gives a pretty good sense of current demand and market conditions is the rate at which properties go under contract. Specifically, we look at what percentage of properties go under contract in ten days or less. We started tracking this in February when market conditions were particularly frenzied. At the time, 56% of all properties went under contract within 10 days. Of the listings that came to market between August 10th and August 17th, 29.79% went under contract within 10 days. That’s actually up a little from the last period we tracked between July 25th and August 1st when 22.45% went under contract within 10 days or less of coming to market.
Looking specifically at homes, 30.43% of the new listings between August 10th and 17th went under contract in 10 days or less. For comparison’s sake, between August 10-17, 2021, 50% of new inventory went under contract in 10 days or less. For a pre-covid reference point, it was 15.15% of new home listings between August 10th – August 17th, 2019 . I do want to mention that this seems to be an anomalously low week. Other recent 2019 comparisons came in around 25%.
For condos, 29.17% of the new listings between August 10th and August 17th went under contract in ten days or less. During the same time span of 2021 and 2019 respectively, the numbers came in at 58.33% and 30.43%.
Overall, we are well below last year’s frenzy. While we may have fewer buyers and sellers, the overall absorption of new properties is similar to what we experienced before Covid.
Interest Rates
One other variable relevant to market conditions is interest rates. Recent movement in the bond market pushed interest rates on the 30 year fixed mortgage back up over 6%. This is the first time mortgages hit that rate since June. From recent discussions with mortgage brokers, many borrowers are opting for 10 year ARMs to lower monthly payments. That said, regardless of the mortgage product borrowing costs are significantly higher now than they were 12 or even 6 months ago. That is going to have a big impact on affordability.
Some Musings Eye Candy From Maui’s Sandy Shores
Contact The Maui Real Estate Team
Questions, comments or feedback? Contact The Maui Real Estate Team to discuss the latest market musings or if you need assistance buying or selling Maui Real Estate. Our experienced team of agents is well suited to assist buyers and sellers in the current dynamic market conditions. We look forward to hearing from you and discussing your real estate needs.
