Welcome to our 25th edition of the Maui Market Musings. This latest edition focuses on the market activity during March, and the resulting levels of inventory at the end of the month. Being that these are long posts, I will skip the pleasantries and cut straight to the numbers.
March Market Activity
The tables below show new Inventory, new pending sales and closed transactions for the month of March. The previous five years are shown for additional context. One thing to note, we started adding these charts just a few months ago. This is the first time the charts will start capturing data from the very start of when the pandemic started to influence the market. The influence will be particularly pronounced with next month’s charts.
| March 23 | March 22 | March 21 | March 20 | March 19 | March 18 | |
| Homes | 70 | 119 | 159 | 88 | 161 | 118 |
| Condos | 99 | 188 | 190 | 181 | 157 | 191 |
Maui entered the month of March with a shortage of inventory and it left the month of March with even fewer properties for sale. The 70 homes listed is 41% below last year. The closest March for new inventory in the previous five years is March 2020, and there was still 25% more inventory that month. Keep in mind, listing activity for homes dropped to next to nothing in the second half of March 2020 as stay at home orders went out and tourism closed.
The 99 new condos that came on the market in March is 47% below last March. The next closest recent March was in 2019. The 157 condos listed that month is 59% higher than this month. As a side note, March 2020 was a big month for condo listings. While people were reticent to list their homes, many opted to list their now vacant vacation rental condos.
March New Pending Sales
| March 23 | March 22 | March 21 | March 20 | March 19 | March 18 | |
| Homes | 70 | 100 | 144 | 60 | 106 | 112 |
| Condos | 85 | 169 | 284 | 57 | 149 | 204 |
While new listing activity is slow, buyer demand also remains slow. New home pendings came in 30% lower than last year. They are 34% lower than March of 2019. They only exceed March of 2020 when pending sales dwindled to a trickle in the second half of the month. There were also quite a few pending sales that cancelled.
March Closed Transactions
| March 23 | March 22 | March 21 | March 20 | March 19 | March 18 | |
| Homes | 72 | 98 | 118 | 82 | 90 | 100 |
| Condos | 115 | 183 | 228 | 157 | 152 | 126 |
The gap in closed home transactions with the previous five years wasn’t quite as extreme. Home sales were about 27% behind last year. They came in 20% and 28% behind March of 2018 and 2019 respectively. They were closest to March of 2020, albeit some of that is due to transactions that either delayed closing or cancelled at the onset of Covid.
The closed condo sales came in 37% behind March of 22. The gap with pre-covid years was not quite as substantial. This March’s numbers came in 24% and 9% below 2019 and 2018 respectively. That 2018 year was particularly slow for condo sales. It is notable that the March 2023 sales received a boost from 14 new developer closes at Paradise Ridge Estates. These closes came from contracts written between 2018 and February of 2021.
End of March Home Inventory
The charts below show active and pending home sales by price point and community on the last day of the month over the last three months.
| 1/31/23 | 2/28/23 | 3/31/23 | ||||
| Active | Pending | Active | Pending | Active | Pending | |
| <$750,000 | 10 | 11 | 10 | 7 | 8 (-2) | 6 (-1) |
| $750,000-$999,999 | 21 | 25 | 30 | 28 | 19 (-11) | 35 (+7) |
| $1,000,000-$1,499,999 | 71 | 30 | 59 | 40 | 47 (-12) | 31 (-9) |
| $1,500,000-$1,999,999 | 33 | 9 | 32 | 7 | 29 (-3) | 11 (+4) |
| $2,000,000-$2,999,999 | 42 | 7 | 37 | 13 | 38 (+1) | 9 (-4) |
| $3,000,000-$4,999,999 | 32 | 10 | 35 | 9 | 36 (+1) | 12 (+3) |
| $5,000,000-$9,999,999 | 27 | 6 | 26 | 9 | 35 (+9) | 8 (-1) |
| $10,000,000-$19,999,999 | 16 | 0 | 13 | 1 | 12 (-1) | 3 (+2) |
| $20,000,000+ | 5 | 1 | 5 | 1 | 6 (+1) | 0 |
| Totals | 257 | 99 | 247 | 115 | 230 (-17) | 115 |
| 1/31/23 | 2/28/23 | 3/31/23 | ||||
| Active | Pending | Active | Pending | Active | Pending | |
| Haiku | 26 | 7 | 27 | 5 | 26 (-1) | 4 (-1) |
| Hana | 9 | 1 | 11 | 1 | 12 (+1) | 1 |
| Ka’anapali | 10 | 5 | 10 | 5 | 9 (-1) | 5 |
| Kahului | 13 | 11 | 18 | 8 | 8 (-10) | 12 (+4) |
| Kapalua | 7 | 1 | 6 | 2 | 10 (+4) | 1 (-1) |
| Kihei | 32 | 17 | 29 | 24 | 24 (-5) | 16 (-8) |
| Kula | 21 | 11 | 14 | 14 | 16 (+2) | 13 (-1) |
| Lahaina | 19 | 9 | 16 | 8 | 16 | 3 (-5) |
| Makawao | 31 | 6 | 27 | 8 | 23 (-4) | 10 (+2) |
| Napili/Kahana/Hono | 13 | 1 | 12 | 2 | 14 (+2) | 3 (+1) |
| Pukalani | 11 | 4 | 7 | 6 | 6 (-1) | 4 (-2) |
| Spreckelsville/Paia | 8 | 1 | 10 | 0 | 9 (-1) | 2 (+2) |
| Wailea | 16 | 3 | 14 | 7 | 15 (+1) | 8 (+1) |
| Wailuku | 30 | 17 | 35 | 21 | 29 (-6) | 29 (+8) |
Five Notable Things About the End of March Home Inventory
- The number of active listings at the end of March dropped 7% compared to the end of February while the number of pending sales remained exactly the same.
- Looking at the inventory by price points, the thing that stands out is the decrease in inventory under $2,000,000. The decrease below $1,000,000 is particularly pronounced. After market activity in this price segment slowed in the fall due to the spike in interest rates, buyers appear to be returning to this segment. Meanwhile, the number of new listings in this price range is particularly limited.
- With two exceptions, the inventory in price ranges above $2,000,000 increased modestly. The exceptions being the $5,000,000-$9,999,999 range and the $10,000,000-$19,999,999. The former experienced a pretty sizable spike in inventory with nine more listings than at the end of February. The inventory in the $10,000,000 price range decreased by 1. Luxury homes in this price range were pretty quiet through the fall and early winter. We are starting to see a little bump in activity in this range with 3 pending sales over the last 2 months.
- Looking at the numbers at a community level, Wailuku and Kahului both saw substantial drops in active listings and increases in pending listings. This is a reflection of the shifts in the market below $1,000,000.
- Kihei continues to see inventory levels decline. At the end of July, there were 68 active listings in Kihei. That number dwindled to 24 at the start of this month. It is important to point out that there is a significant contrast in market conditions by price point in Kihei. As of today, 18 of 25 listings priced at $1,550,000 or below are under contract. Of the 16 listings over that price point, only one is under contract. This is something to keep in mind with the numbers above. We try to provide some granularity on market conditions by breaking down by price point and community. If you are an engaged buyer or seller, it is necessary to break things down by price point and community to get a better sense of market conditions specific to your interests.
End of March Condo Inventory
The charts below provide end of the month active and pending condo inventory by price point and district. It is worth noting that the Wailea pending sales continue to receive a boost from 75 new developer units under contract in La’i Loa at Wailea Hills. These properties went pending between 2020 and the the first quarter of 2021. Priced from just under $1,500,000 all the way up to over $4,000,000, these long term contracts are also skewing the pending sales upwards in this price range.
| 1/31/23 | 2/28/23 | 3/31/23 | ||||
| Active | Pending | Active | Pending | Active | Pending | |
| <$250,000 | 1 | 2 | 2 | 2 | 0 (-2) | 2 |
| $250,000-$499,999 | 14 | 11 | 16 | 14 | 14 (-2) | 10 (-4) |
| $500,000-$749,999 | 49 | 31 | 41 | 42 | 48 (+7) | 27 (-15) |
| $750,000-$999,999 | 39 | 42 | 29 | 45 | 32 (+3) | 31 (-14) |
| $1,000,000-$1,499,999 | 29 | 32 | 33 | 30 | 27 (-6) | 31 (+1) |
| $1,500,000-$1,999,999 | 30 | 35 | 33 | 35 | 24 (-9) | 42 (+7) |
| $2,000,000-$2,999,999 | 17 | 40 | 18 | 41 | 17 (-1) | 38 (-3) |
| $3,000,000-$4,999,999 | 11 | 17 | 12 | 17 | 15 (+3) | 17 |
| $5,000,000-$9,999,999 | 12 | 2 | 13 | 0 | 13 | 2 (+2) |
| $10,000,000+ | 4 | 0 | 5 | 0 | 6 (+1) | 0 |
| Totals | 206 | 212 | 202 | 226 | 196 (-6) | 200 (-26) |
| 1/31/23 | 2/28/23 | 3/31/23 | ||||
| Active | Pending | Active | Pending | Active | Pending | |
| Ka’anapali | 24 | 12 | 27 | 6 | 23 (-4) | 11 (+5) |
| Kahului | 3 | 4 | 3 | 4 | 4 (+1) | 0 |
| Kapalua | 13 | 6 | 14 | 5 | 13 (-1) | 7 (+2) |
| Kihei | 65 | 72 | 52 | 79 | 59 (+7) | 49 (-30) |
| Lahaina | 12 | 9 | 14 | 9 | 17 (+3) | 6 (-3) |
| Ma’alaea | 5 | 7 | 5 | 7 | 5 | 4 (-3) |
| Napili/Kahana/Hono | 50 | 14 | 52 | 21 | 43 (-9) | 25 (+4) |
| Wailea | 26 | 81 | 28 | 85 | 27 (-1) | 89 (+4) |
| Wailuku | 7 | 6 | 7 | 8 | 5 (-2) | 9 (+1) |
Five Notable Things from the End of March Condo Inventory
- The active inventory of condos for sale dropped 3% from the end of February to the end of March. The number of pending sales dropped 9% from February 28th to March 31st. Over half of that dip in pending sales comes from the Paradise Ridge closes mentioned earlier in the blog.
- Changes in month to month active inventory by price point varies quite a bit. Inventory under $500,000 decreased modestly. It increased between $500,000-$1,000,000 and decreased between $1,000,000 and $3,000,000. There was a modest increase in active listings over $5,000,000.
- Pending sales dropped under $1,000,000, rose between $1,000,000 and $2,000,000 and were mixed above that price point. Paradise Ridge Sales accounted for some, but certainly not all of the drop under $1,000,000.
- Looking at month to month changes in the condo inventory by district, the resort communities of Wailea, Ka’anapali and Kapalua followed similar trends. A decrease in active listing from the month prior and a modest increase in pending sales.
- The shift in end of month inventory for Kihei catches the eye. Active inventory increased by seven listings. Pending sales dropped by 30. While a big chunk of that is Paradise Ridge, that is still a pretty substantial drop in pendings.
Some Overall Thoughts on Market Conditions
The Maui Real Estate market continued forward through March under both constrained inventory and reduced demand. The lack of inventory offsets the reduced demand and that is what is sustaining and even increasing prices in some parts of the market. There are couple of things that I touched on with the condo market that probably merit some additional discussion.
I wanted to circle back to the Kihei Condo market as the numbers there were particularly interesting. I discussed how there was a stark contrast in market activity by price point for Kihei Homes. For condos, there is a difference in market activity between vacation rental condos and non-vacation rental condos.
For vacation rentals, supply continues to be one of the biggest limiting factors for market activity. There are quite a few of the more prominent Kihei vacation rental condo developments with very little to no inventory. There are buyers out there who are looking, but can’t find want they want. To be clear, it isn’t all about supply. Quite a few buyers are priced out from the second home vacation rental market, and a number of sellers are still shooting for the moon on pricing.
For the entry level, non-vacation rental condos, affordability issues exert a greater influence on market conditions. Inventory is starting to increase in this market segment with active listings growing in condo developments like Kihei Villages, Southpointe and Keonekai Villages. Buyers are still snatching up condos in these places when priced below $560,000. However, once you get above that price point, there are a substantial number of condos available.
One last note on the condo market, I mentioned the resort market briefly in my discussion on condo inventory. This is another market segment where a lack of inventory is limiting market activity. In Kapalua, there are currently no active listings at Kapalua Bay Villas or The Ridge. In Wailea, the inventory in the vacation rental market is very limited under $1,500,000. Non-vacation rental condos like Keala O Wailea, Makali’i and Kai Malu have no active listings. The only complexes where supply appears to be more plentiful in Wailea is in high end developments like Wailea Point and Wailea Beach Villas.
It will be interesting to see what happens as we move forward in the spring. We are coming to the very end of our peak season. What type of demand will we see moving forward? What will interest rates do? About the only thing I can say with any measure of confidence is that a big influx of inventory remains unlikely. We will continue to keep you posted in future market musings.
