This is the 23rd edition of our Maui Market musings. We started this series of posts just over a year ago. Our goal was to try to look at market statistics that provide a better indication of current market conditions. Sales figures can lag behind current market dynamics. We wanted to focus on supply and current demand in what was a more dynamic market. The market slowed quite a bit over the last year, but market conditions are far from straight forward. Keep reading below to learn more about January market activity, active and pending listings and information on sales price vs. list price.

January Market Activity

What type of market did we see in the past month? How many homes and condos came to market, how many went under contract and how many sold? Data from the previous 5 years provides some context.

New Inventory

	January 23	January 22	January 21	January 20	January 19	January 18
Homes	66	117	104	133	135	134
Condos	113	195	197	164	197	215

Looking at the chart above, new inventory is well below normal. Not just compared to the last couple of years but particularly compared to January in the three years prior to the start of the pandemic. New home inventory is almost 44% below last January and over 50% lower than any January between 2018 and 2020. Condo inventory wasn’t off quite as much. It is 42% lower than last year and anywhere between 30% and 47% lower than January of 2018, 2019 and 2020.

Constrained inventory may be a challenge for a while. The low interest rates of the last couple of years have have potential Sellers that might be looking to step up to a larger home or downsize staying put. Other potential sellers are reticent to list with limited replacement inventory available.

Pending Sales

	January 23	January 22	January 21	January 20	January 19	January 18
Homes	54	90	120	89	98	106
Condos	90	177	243	133	153	162

January typically marks the first full month of our winter buying season. This period that runs from Christmas to mid-April coincides with peak visitor season. After a quiet fall, there was some question as to whether we might see a resumption of normal or at least something closer to normal buyer activity as we enter busy season. Thus far, that does not appear to be the case. Pending home sales are off 40% from last year and anywhere between 39% and 49% below January during 2018-2020. Pending condo sales are down 49% from last year and anywhere between 32% and 44% below 2018-2020.

Closed Transactions

	January 23	January 22	January 21	January 20	January 19	January 18
Homes	59	91	94	81	61	83
Condos	52	151	114	124	125	120

The sales numbers are a lagging indicator. For the most part, they tend to reflect contracts agreed upon in November and December. The data above reinforces what we noted in previous editions of our market musings. It was a slow fall, particularly for condo sales.

Home sales are 35% below last year and anywhere between 3% and 29% below January 2018-2020. On the condo front, this January’s sales are a whopping 65% below last year and between 57% and 58% below January 2018, 2019 and 2020.

End of Maui January Home Inventory

The charts below provide end of the month active and pending home inventory by price point and district around Maui.

	11/30/22		12/31/22		1/30/23
	Active	Pending	Active	Pending	Active	Pending
<$750,000	5	14	6	10	10 (+4)	11 (+1)
$750,000-$999,999	31	25	25	28	21 (-4)	25 (-3)
$1,000,000-$1,499,999	61	28	78	20	71 (-7)	30 (+10)
$1,500,000-$1,999,999	28	17	36	11	33 (-3)	9 (-2)
$2,000,000-$2,999,999	34	11	37	12	42 (+5)	7 (-5)
$3,000,000-$4,999,999	32	7	31	9	32 (+1)	10 (+1)
$5,000,000-$9,999,999	23	9	27	8	27	6 (-2)
$10,000,000-$19,999,999	14	0	14	0	16 (+2)	0
$20,000,000+	5	1	4	2	5 (+1)	1 (-1)
Total	233	112	258	100	257 (-1)	99 (-1)

	11/30/22		12/31/22		1/31/23
	Active	Pending	Active	Pending	Active	Pending
Haiku	29	10	29	7	26 (-3)	7
Hana	10	0	10	1	9 (-1)	1
Ka’anapali	9	2	9	3	10 (+1)	5 (+2)
Kahului	16	13	16	13	13 (-3)	11 (-2)
Kapalua	5	3	5	3	7 (+2)	1 (-2)
Kihei	31	15	39	7	32 (-7)	17 (+10)
Kula	22	12	21	10	21	11 (+1)
Lahaina	15	13	18	11	19 (+1)	9 (-2)
Makawao	11	7	35	4	31 (-4)	6 (+2)
Napili/Kahana/Hono	9	3	13	3	13	1 (-2)
Pukalani	10	3	7	3	11 (+4)	4 (+1)
Sprecks/Paia	7	3	9	1	8 (-1)	1
Wailea	16	4	13	6	16 (+3)	3 (-3)
Wailuku	32	19	25	25	30 (+5)	17 (-8)

Three Things to Note About the End of January Home Inventory

• Overall, there was remarkably little change in active and pending sales since the end of December. Island wide there was only one fewer pending listing and one fewer active listing. Have I mentioned that January is usually the start of busy season? This is not the type of month to month shift you would expect with more seasonal activity.
• Drilling down by price point, a little more change is evident. The price ranges between $750,000-$1,500,000 tend to have the highest percentage of financed transactions. That range experienced higher inventory and decreased pendings through much of the fall due to higher rates. With rates lower through much of January, inventory is starting to decrease again. The $1,000,000-$1,500,000 price saw the biggest increase in pending sales of any price point.
• Home buyer activity in the resorts remained quiet. Kapalua and Wailea both saw a decrease in pending sales and a small increase in active inventory. Ka’anapali inventory increased with a couple of additional pending sales reported.

End of January Maui 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 receive a boost from 75 new developer units reserved in La’i Loa at Wailea Hills. These properties went under contract 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 also pending sales upwards in this price range. Paradise Ridge Estates is another new development in Kihei with 18 pending sales based on contracts signed between 2018 and the first quarter of 2022.

	11/30/22		12/31/22		1/30/23
	Active	Pending	Active	Pending	Active	Pending
<$250,000	1	4	2	2	1 (-1)	2
$250,000-$499,999	19	14	12	16	14 (+2)	11 (-5)
$500,000-$749,999	43	33	38	25	49 (+11)	31 (+6)
$750,000-$999,999	28	29	42	27	39 (-3)	42 (+15)
$1,000,000-$1,499,999	31	24	32	21	29 (-3)	32 (+11)
$1,500,000-$1,999,999	21	28	26	29	30 (+4)	35 (+6)
$2,000,000-$2,999,999	18	39	18	36	17 (-1)	40 (+4)
$3,000,000-$4,999,999	11	17	10	18	11 (+1)	17 (-1)
$5,000,000-$9,999,999	12	2	14	0	12 (-2)	2 (+2)
$10,000,000+	3	0	4	0	4	0
Totals	187	190	198	174	206 (+8)	212 (+38)

	11/30/22		12/31/22		1/31/23
	Active	Pending	Active	Pending	Active	Pending
Ka’aanapali	25	4	22	9	24 (+2)	12 (+3)
Kahului	5	5	4	3	3 (-1)	4 (+1)
Kapalua	14	2	12	3	13 (+1)	6 (+3)
Kihei	53	61	61	45	65 (+4)	72 (+27)
Lahaina	14	8	11	12	12 (+1)	9 (-3)
Ma’alaea	4	8	5	5	5	7 (+2)
Napili/Kahana/Hono	39	19	50	16	50	14 (-2)
Wailea/Makena	23	85	27	79	26 (-1)	81 (+2)
Wailuku	8	8	4	4	7 (+3)	6 (+2)

Three Things to Note About The End of January Condo Activity

• The end of January condo numbers do show more of a seasonal shift with a 21.83% increase in pending sales over the end of December. It also appears as if more sellers are coming to market with active listings increasing despite the increased pending sales.
• Drilling down by price point, the increase in pending sales is pretty broad based with only two price ranges showing fewer pending sales and two price points unchanged.
• Looking at the districts, Kihei is by far and away the focal point of increased condo sales. Kihei pending sales increased 60% since the end December. Pending sales throughout the rest of the districts were mixed. Notably, Wailea and the other resorts were really quiet as was the Napili, Kahana and Honokowai district.

Interest Rates

One of the bigger takeaways from the home inventory was the increase in buyer activity and decrease in listings in the price ranges with more financed buyers. The decrease in interest rates at the end of last year and to start this year improved affordability bringing buyers back to the market. There were some who thought further decreases in rates could heat up the market again. Well, if you haven’t been tracking rates closely, they are back on the rise again.

Forecasting rates is a fool’s errand at this point. That said, the trajectory of rates will continue to impact the market. Needless to say, higher rates may cool some segments of the market while any substantive decrease in rates could boost demand.

Are Sellers Negotiating?

During the frenzied market of 2021 and the first half of 2022, negotiation became something of a forgotten term on Maui. Sellers were in the driver seat and a significant number of the sales closed for asking price or above. With less buyer activity than last year, how much are sellers willing to negotiate in the current market?

While we don’t have transparency on contract prices with recent pending sales, I looked at closed sales between January 1 and February 15th to get a sense of how much negotiation occurred.

Looking at the home chart, you can see that there still is some competition for homes with 31% of all sales coming in at full asking price and an additional 13% over asking price. That points to the continued impact of low inventory. While there are fewer buyers, the below normal inventory levels mean that there can be competition for quality listings. That said, 18% of buyers are paying anywhere between 5% and 10% below asking price. An additional 15% are paying more 10% below asking price with a handful of those more than 20% below.

Looking at the condo chart, recent sales point to a more competitive market with 18% of recent sales closing for over asking price and 37% for full price. Only 16% of all listings sold for less than 95% of asking price with only 1% less than 90% of asking price. While buyer activity is down, inventory remains limited and some segments of the market are particularly scarce.

Overall, buyers have more latitude to make offers under current market conditions. That said, it really depends on price range and the districts where they are searching. It is also worth noting that a number of the sellers who are negotiating are those that priced above market. At this point, values feel pretty stable and sellers aren’t chasing the market.

A Few Last Thoughts

This musings is being published a little later than usual in the month. That afforded me the opportunity to incorporate sales data from the first 15 days of the month in the section above. While I didn’t delve into this February’s pending data yet, at a surface level the overall number of pending sales continues to increase. They should be rising as this is our peak buying season. The questions is how much are pending sales increasing compared to what is normal during this time of year? Anecdotally, it seems like the resorts are seeing a little more activity than they were in January. It will be interesting to see how the numbers stack up to previous years at the end of the month.

While things are understandably busier than the fall, market conditions remain weird. Decreased demand for this time of year is offset in part by lower inventory. That creates some pockets of the market that remain competitive. That said, there are also a fair number of sellers stuck in the market frenzy mindset. For the most part, those properties are quiet and accumulating days on market.

There are still quite a few sellers hitting surprisingly high prices. That’s part of the weird vibe that permeates the market.

A Little Maui Beauty to Brighten This Post

Contact The Maui Real Estate Team

Questions on this month’s numbers? Thinking about buying or selling property on Maui? Contact the Maui Real Estate Team. We welcome the chance to talk, listen and learn more about your real estate needs. Out experienced group of agents are here to help you guide through the current market’s peculiar conditions.

We are starting off 2023 with volume 22 of our market musings. Early January means that we are in the beginning of what is traditionally our peak real estate season on Maui. This post helps to give a sense of recent market demand and current inventory levels as we enter into what should be the busiest 3-4 months of the year for real estate transactions on island.

December Market Activity

We start things off by taking a look back at December. How many new listings came to market, went under contract and sold? Activity from the five previous Decembers are given for additional context.

	12/22	12/21	12/20	12/19	12/18	12/17
Homes	89	98	115	121	120	140
Condos	76	162	152	143	173	173

New inventory during the month of December was below normal. The number of new listings is anywhere between 25% and 36% lower than what we would anticipate in the pre-Covid Decembers of 2017-2019. This December’s home inventory benefited from an influx of new listings in the Hoku’ula subdivision in Upcountry Maui towards the end of the month. Were it not for those 19 listings, new inventory would be even further below what’s considered normal.

New condo inventory was significantly lower than usual in December. It is anywhere between 47% and 56% below the December new inventory of 2017-2019. Whether it’s the golden handcuffs of low interest rates, the lack of potential replacement properties or just loving their place on Maui, people are holding on to their condos for now.

	12/22	12/21	12/20	12/19	12/18	12/17
Homes	51	69	117	74	75	75
Condos	53	136	139	113	110	108

While new inventory was low, buyer demand also remained low in December. The number of new pending home sales came in at anywhere between 32-33% below what we saw in the three years prior to the start of Covid.

New Pending condo sales came in between 45% and 52% below the activity seen over the years prior to Covid. The slow down in new condo inventory and sales activity is particularly pronounced over the last few months.

	12/22	12/21	12/20	12/19	12/18	12/17
Homes	64	113	106	96	91	89
Condos	67	171	170	125	122	140

The closed transactions in December give us some insight to market demand a little earlier in the fall. Most of these closes came out of contracts agreed to in October and November. Home sales were between 28 and 33% lower than a typical Pre-Covid December. Condo sales in December are between 45 and 53% lower than the three Decembers prior to the start of Covid. Of course, this December’s home and condo sales are way below 2020 and 2021 sales volume.

End of December Maui Inventory

Inventory, or lack thereof, continues to be a significant factor in our market. While new inventory remains low, quieter buyer activity over the last 2-3 months allowed for modest growth in the overall number of properties for sale. That said, we still have a lot less inventory that what was more typical pre-Covid. The charts below provide detail on active and pending listings by price point and community.

End of December Home Inventory

	10/31/2022		11/30/2022		12/31/2022
	Active	Pending	Active	Pending	Active	Pending
<$750,000	9	15	5	14	6 (+1)	10 (-4)
$750,000-$999,999	29	29	31	25	25 (-6)	28 (+3)
$1,000,000-$1,499,999	64	28	61	28	78 (+17)	20 (-8)
$1,500,000-$1,999,999	41	13	28	17	36 (+8)	11 (-6)
$2,000,000-$2,999,999	35	10	34	11	37 (+3)	12 (-1)
$3,000,000-$4,999,999	32	7	32	7	31 (-1)	9 (+2)
$5,000,000-$9,999,999	26	5	23	9	27 (+4)	8 (-1)
$10,000,000-$19,999,999	9	0	14	0	14	0
$20,000,000+	3	1	5	1	4 (-1)	2 (+1)
Totals	248	108	233	112	258 (+25)	100 (-12)

	10/31/2022		11/30/2022		12/31/2022
	Active	Pending	Active	Pending	Active	Pending
Haiku	28	9	29	10	29	7 (-3)
Hana	10	0	10	0	10	1 (+1)
Ka’anapali	7	2	9	2	9	3 (+1)
Kahului	16	16	16	13	16	13
Kapalua	6	0	5	3	5	3
Kihei	40	11	31	15	39 (+8)	7 (-8)
Kula	20	11	22	12	21 (-1)	10 (-2)
Lahaina	22	13	15	13	18 (+3)	11 (-2)
Makawao	13	9	11	7	35 (+24)	4 (-3)
Napili/Kahana/Honokowai	11	6	9	3	13 (+2)	3 (-3)
Pukalani	8	3	10	3	7 (-3)	3
Sprecks/Paia	8	2	7	3	9 (+2)	1 (-2)
Wailea	11	4	16	4	13 (-3)	6 (+2)
Wailuku	40	21	32	19	25 (-7)	25 (+6)

Notable Numbers from the End of December Home Inventory

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 and communities with the most activity.

• For the second month in a row, the inventory of active home listings increased on Maui. Active inventory increased 10.7%. A good portion of the bump in inventory can be traced to the 19 new developer listings in the Hoku’ula subdivision.
• Changes in active inventory varied by price point. Five price points increased in inventory, three decreased and one was unchanged. The price range with the biggest increase in inventory was between $1,000,000 and $2,000,000. Again, that was largely due to Hoku’ula. It was notable that the $750,000-$999,999 price range saw the biggest drop in active listings from the month prior. Inventory in that segment increased steadily in the the previous three months. With a higher percentage of financed buyers in this price point, the spike in interest rates earlier in the fall curtailed buyer demand.
• Overall Pending home inventory decreased from the end of November. The number of pending homes dipped 10.71% between November 30th and December 31st.
• By price point, pending sales increased in three price ranges, decreased in five and remained unchanged in three price points. The biggest increase in pending sales occurred in the $750,000-$999,999 range. Perhaps recent decreases in interest rates provided some relief to buyers in that price range. The biggest decrease in pending sales occurred in the $1,000,000-$2,000,000 price range.
• At a community level, inventory trends continued to vary. Inventory increased in 5 communities, decreased in 4 and remained unchanged in 5 districts. The biggest increase by far was in Makawao (the Hoku’ula effect) followed by Kihei. Wailuku inventory decreased the most.
• Pending sales decreased in most communities. Kihei pending sales decreased the most month to month. Wailuku experienced the biggest increase in pending sales.

End of December Maui Condo Inventory

	10/31/2022		11/30/2022		12/31/2022
	Active	Pending	Active	Pending	Active	Pending
<$250,000	2	4	1	4	2 (+1)	2 (-2)
$250,000-$499,999	19	12	19	14	12 (-7)	16 (+2)
$500,000-$749,999	32	35	43	33	38 (-5)	25 (-8)
$750,000-$999,999	27	27	28	29	42 (+14)	27 (-2)
$1,000,000-$1,499,999	21	30	31	24	32 (+1)	21 (-1)
$1,500,000-$1,999,999	14	33	21	28	26 (+5)	29 (+1)
$2,000,000-$2,999,999	15	40	18	39	18	36 (-3)
$3,000,000-$4,999,999	10	17	11	17	10 (-1)	18 (+1)
$5,000,000-$9,999,999	11	1	12	2	14 (+2)	0 (-2)
$10,000,000+	3	1	3	0	4 (+1)	0
Total	154	200	187	190	198 (+11)	174 (-16)

	10/31/2022		11/30/2022		12/31/2022
	Active	Pending	Active	Pending	Active	Pending
Ka’anapali	18	9	25	4	22 (-3)	9 (+5)
Kahului	5	5	5	5	4 (-1)	3 (-2)
Kapalua	12	4	14	2	12 (-2)	3 (+1)
Kihei	43	60	53	61	61 (+8)	45 (-16)
Lahaina	8	4	14	8	11 (-3)	12 (+4)
Ma’alaea	3	6	4	8	5 (+1)	5 (-3)
Napili/Kahana/Honokowai	33	17	39	19	50 (+11)	16 (-3)
Wailea/Makena	19	85	23	85	27 (+4)	79 (-6)
Wailuku	11	10	8	8	4 (-4)	4 (-4)

Notable Numbers from the End of December Condo Inventory

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 the fall of 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. Overall, 53.44% of the current pending condo inventory is in La’i Loa or Paradise Ridge Estates.

• For the third straight month, end of month inventory of active condo listings grew. It increased 5.88% from the end of November.
• Looking at the inventory by price point, there continues to be a lot of variability. While most price points saw modest changes, the inventory of $250,000-$749,999 condos decreased by a decent margin. The inventory of condos priced between $750,000 and $999,999 increased substantially. There was also a bump in inventory between $1,500,000 and $1,999,999.
• End of the month pending condo sales dropped for the third straight time. Pending sales dropped 8.43%.
• Most price ranges saw a decrease in pending sales by the end of the month. The $500,000-$749,999 price range saw the biggest drop in activity followed by the $2,000,000-$2,999,999 price point.
• At a community level, most locations saw modest changes in inventory. There were exceptions. Kihei and the Napili, Kahana and Honokowai MLS district saw pretty big increases. Ka’anapali and Wailuku both saw notable decreases in inventory.
• Most communities saw a decrease in pending sales by the end of December. Kihei saw the biggest decrease in pending sales. While Wailea’s decrease was smaller, it is notable that the vast majority of the remaining pending sales are longer term contracts at La’i Loa. Only 4 of the 79 pendings in Wailea at the end of the month were condos outside of that development.
• The West Maui communities of Ka’anapali and Lahaina were both notable for their increase in pending condo sales.

How Quickly Are Things Going Under Contract

We started tracking the percentage of properties going under contract in ten days or less all the way back in February. At the time, the market was in a frenzy and 56% of all new listings went under contract within that first ten days of coming to market. We’ve seen things slow considerably since that time. I took a look at properties that came to market between December 13th and December 20th. Of the 35 listings that came to market, 25.71% went under contract within the first ten days. That is actually up from when we last checked in November when only 15.9% of all properties went under contract.

Looking specifically at homes, 20% of the homes listed between December 13 and 20th went under contract within 10 days or less. Last year during the same period, 15.38% of new home listings went under contract in 10 days or less. In 2019, 20% of homes went under contract in 10 days or less.

Of the condos that came to market between December 13th and 20th, 30% went under contract within 10 days. For perspective, 41.51% of all condos listed between December 13-20th, 2021 went under contract in ten days or less. In 2019, 15.22% of condos listed during that same time period went under contract in 10 days or less.

My biggest takeaway from these numbers is that we are well off the frenzy of 2021 and the first quarter of 2022. Response to new listings is closer to what we had pre-Covid. Back then, quality properties priced well tended to go quickly. That continues to be the case today. Unless there is a lot of push back from the readership or we see a clear shift in market conditions, I am going to retire this metric from future musings posts.

Price Reductions

While market activity remained slow in December, it doesn’t seem to be fazing too many sellers. As of December 31st, only 33.33% of all active listings had one or more price reduction. That is down from 37.02% on November 30th and 39.92 on October 31st. It was all the way up at 42.21% in late September.

The condo market is seeing even fewer price reductions. As of New Year’s eve, only 25.25% of all active condo listings were reduced in price one or more times. That is down slightly from 25.53% on November 30th and 29.41% on October 31st.

I surmise that low inventory and seller hopes for a seasonal increase in buyers has led more seller to stick their guns on pricing.

Quick Thoughts On the Market as We Enter Maui Peak Buying Season

Needless to say, the trajectory of the market isn’t entirely clear at the start of buyer’s season. Inventory is up from last winter, but still well below normal. Demand is lower, but it should potentially increase just due to seasonality. Affordability is down significantly from this time last year, but there is still a lot of cash in our market and rates are better than they were earlier in the fall. Add it all together and it makes prognostication a challenge. About the only thing I feel comfortable predicting is continued variability in conditions by price range and by location around the island. We will continue to provide market observations as buyer season progresses on the blog.

A Little Maui Beauty

Contact The Maui Real Estate Team

With the uncertainty in the Maui Real Estate market, quality representation is more important now then ever. Contact the Maui Real Estate Team. Our experienced agents welcome the chance to discuss your real estate needs. We look forward to being of assistance.

It’s that time again. This is the twenty-first edition of the Maui Real Estate Market Update. Our weekly, biweekly, monthly update on the Maui Real Estate market. The latest edition looks at active and pending inventory, price reductions and demand for new listings. There are plenty of words down below, so I will spare you from any more up here…

End of November Maui Home Inventory

	9/30/22		10/31/22		11/30/22
	Active	Pending	Active	Pending	Active	Pending
<$750,000	7	14	9	15	5 (-4)	14 (-1)
$750,000-$999,999	21	46	29	29	31 (+2)	25 (-4)
$1,000,000-$1,499,999	45	33	64	28	61 (-3)	28
$1,500,000-$1,999,999	44	17	41	13	28 (-13)	17 (+4)
$2,000,000-$2,999,999	33	12	35	10	34 (-1)	11 (+1)
$3,000,000-$4,999,999	35	11	32	7	32	7
$5,000,000-$9,999,999	27	6	26	5	23 (-3)	9 (+4)
$10,000,000-$19,999,999	11	0	9	0	14 (+5)	0
$20,000,000+	2	1	3	1	5 (+2)	1
Total	225	140	248	108	233 (-15)	112(+4)

	9/30/22		10/31/22		11/30/22
	Active	Pending	Active	Pending	Active	Pending
Haiku	24	7	28	9	29 (+1)	10 (+1)
Hana	9	1	10	0	10	0
Ka’anapali	10	3	7	2	9 (+2)	2
Kahului	7	26	16	16	16	13 (-3)
Kapalua	4	0	6	0	5 (+1)	3 (+3)
Kihei	35	16	40	11	31 (-9)	15 (+4)
Kula	22	11	20	11	22 (+2)	12 (+1)
Lahaina	21	10	22	13	15 (-7)	13
Makawao	13	11	13	9	11 (-2)	7 (-2)
Napili/Kahana/Hono…	9	7	11	6	9 (-2)	3 (-3)
Puklanai	6	7	8	3	10 (+2)	3
Sprecks/Paia	10	4	8	2	7 (-1)	3 (+1)
Wailea	10	8	11	4	16 (+5)	4
Wailuku	36	26	40	21	32 (-8)	19 (-2)

Notable Numbers from the End of November Maui Home Inventory

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 and communities with the most activity.

• After an increase in inventory in October, Maui home inventories decreased again in November. Active listings dropped 6.1%.
• Looking at the the active inventory by price point shows a mix of trajectories. While most price ranges decreased, the continued increase between $750,000 and $999,999 is notable. This is a part of the market with more financed buyers. Those buyers are feeling the affordability impact of higher rates. The $10,000,000 plus price range is not known for financed buyers. That said, it also saw an increase.
• Pending sales actually increased between the end of October and the end of November. While the increase was a modest 3.7%, the increase in activity comes as somewhat of a surprise considering both rates and the more significant decrease between late September and late October.
• Broken down by price point, the picture is more mixed. Again, fewer properties went under contract in that $750,000-$999,999 price range. Pending sales increased in the $1,500,000 to $3,000,000 range. The biggest percentage increase in pending sales was in the $5,000,000 to $9,999,999 price range.
• At a community level, inventory trends were all over the place. Kihei, Lahaina and Wailuku all experienced notable decreases in inventory. Most other markets experienced modest changes with increases or decreases of a couple of homes. The Wailea active inventory increased the most month to month.
• There was also a lot of variability in the end of month change in pending sales by community. Pending sales increased in five communities, remained unchanged in five districts, and decreased in four. Kapalua and Kihei saw the biggest increase in pendings. Kahului and the Napili, Kahana, Honokowai area decreased the most.

End of November Maui Condo Inventory

	9/30/22		10/31/22		11/30/22
	Active	Pending	Active	Pending	Active	Pending
<$250,000	1	3	2	4	1 (-1)	4
$250,000-$499,999	11	16	19	12	19	14 (+2)
$500,000-$749,999	28	40	32	35	43 (+11)	33 (-2)
$750,000-$999,999	33	33	27	27	28 (+1)	29 (+2)
$1,000,000-$1,499,999	19	36	21	30	31 (+10)	24 (-6)
$1,500,000-$1,999,000	18	34	14	33	21 (+7)	28 (-5)
$2,000,000-$2,999,999	14	43	15	40	18 (+3)	39 (-1)
$3,000,000-$5,000,000	10	17	10	17	11 (+1)	17
$5,000,000-$9,999,999	7	0	11	1	12 (+1)	2 (+1)
$10,000,000+	4	0	3	1	3	0
Total	145	222	154	200	187 (+33)	190 (-10)

	9/30/22		10/31/22		11/30/22
	Active	Pending	Active	Pending	Active	Pending
Ka’anapali	17	14	18	9	25 (+7)	4 (-5)
Kahului	3	4	5	5	5	5
Kapalua	10	4	12	4	14 (+2)	2 (-2)
Kihei	48	61	43	60	53 (+10)	51 (-9)
Lahania	5	7	8	4	14 (+6)	8 (+4)
Ma’alaea	4	4	3	6	4 (+1)	8 (+2)
Napili/Kahana/Hono…	29	30	33	17	39 (+6)	19 (+2)
Wailea	19	86	19	85	23 (+4)	85
Wailuku	8	12	11	10	8 (-3)	8 (-2)

Notable Numbers from the End of November Maui Condo Inventory

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. Overall, 49.73% of the pending condo inventory is in La’i Loa or Paradise Ridge Estates.

• End of month condo inventory increased for the second straight month. Active inventory grew by 21.42%.
• Seven out of ten price ranges increased inventory between the end of October and the end of November. Two price ranges remained constant and only condos priced below $250,000 decreased in active inventory.
• The largest increases in active inventory occurred between $500,000-$749,999 and $1,000,000 to $1,999,999.
• Pending sales dipped 5% between the end of October and the end of November. Pendings in four price points decreased, increased in three and remained unchanged in three.
• The biggest decrease in pending sales occurred between $1,000,000 and $1,999,999.
• Active inventory increased in all but two communities. Only Wailuku saw a decrease while Kahului inventory remained unchanged. Kihei increased the most by the number of units and Lahaina increased the most by percentage.
• Pending sales increased the most in Lahaina. Kihei pending sales decreased the most.

Pending Sales vs. New Listings

With the shift in active and pending sales, it is worth taking a look at what’s driving inventory levels. How did November stack up against other years for new listings and new pending sales?

	11/2022	11/2021	11/2019	11/2018	11/2017
Homes	79	114	125	147	140
Condos	109	187	208	153	193

Looking at new inventory in November, you can see that we are well below last year. For homes, there were just over 30% fewer listings than last November. More notably, last month’s new inventory was anywhere between 39% and 46% less than what came to market in November of 2017-2019. The decrease in new condo inventory entering the market in November is even more pronounced. There were roughly 42% less condo listings last month compared to November 2021. New inventory came in anywhere between 53% and 56% lower than Novembers 2017 and 2019. The one outlier being November of 2018. Even that year had 40% more new listings than this year.

	11/2022	11/2021	11/2019	11/2018	11/2017
Homes	63	95	90	80	83
Condos	69	180	147	110	125

While inventory remains low, the number of properties going under contract decreased significantly from last November and the Pre-Covid Novembers Prior. New pending home sales this November are almost 34% lower than last November. They are down between 21 and 30% compared to the Novembers between 2017 and 2019. Again, the difference in the condo market is a little more dramatic. New Pending sales from November 22 are almost 62% less than November of 21. This November’s new pending sales are between 37% and 53% lower than November 2017-2019.

Looking at the numbers above, inventory clearly remains low. Pending sales are also down quite a bit. While some of the decrease in pending sales may be attributed to the limited inventory, decreased demand is the bigger driver for the decrease in activity. The weight of decreased affordability impacts a number of buyers.

How Quickly Are Things Going Under Contract?

Another metric we use to track the market is the speed at which properties are going under contract. Specifically, what percentage of new listings are going under contract in 10 days or less. We started tracking that number in mid February during the peak of last winter’s frenzy. At the time, 56% of all new listings went under contract in ten days or less. Prior to this post, the last time I checked this metric was for the period between October 11th and October 18th. At that time, 25.58% of properties listed during that span went under contract in ten days or less. Between November 21st and November 28th, 15.9% of all properties went into escrow within that ten day span.

Of the single family homes that came to market between November 21st and November 28th, 13.64% went under contract in ten days or less. For context, 36% of homes listed between November 21st and November 28th, 2021 went under contract in ten days or less. Of the homes listed between November 21 and November 28th, 2018, only 4.17% of the properties went under contract in ten days or less.

Of the condos listed between November 21st and November 28th, 18.18% sold in 10 days or less. Last year, 43.24% of condos listed in that period sold for 10 days or less. Pre-covid, 29.26% of condos listed between November 21st and November 28th sold in ten days or less.

Overall, this is the most tepid response new listings received since we started tracking this data point. While the slower market activity could be a function of the Thanksgiving Holiday, the 2021 and 2019 numbers both remained busy despite Thanksgiving.

Price Reductions

A lot of sellers don’t seem to be fretting the smaller numbers of buyers on the market. That is evident in the recent numbers on price reductions in the active inventory. On November 30th, 37.02% of all active home listings reduced their price one or more times. That is down from 39.92% on October 31st and 42.41% on September 29th. While the percentage of homes with price reductions started to tick down nationally in the last couple of weeks of November, the percentage of price reductions started declining in early September on Maui.

On November 30th, 23.53% of all active condo listings reduced their price at least once since being listed. That number was 29.41% on October 31st. It was 25% on September 29th. It’s interesting to see that price reductions are down considering the decreased condo sales activity over the last month. Low inventory and the start of peak winter home buying season at the end of the month is emboldening sellers.

Quick Thoughts on the State of the market.

Weird. My one word summary for the current Maui Real Estate market. Some parts of the market continue to push to all time record highs, other parts are stalled, while other segments of the market are seeing modest price declines. Supply (or lack thereof) and affordability (particularly when you take into account borrowing costs) push and pull the market in different trajectories.

We’ve already looked at the fluctuations in active listings by price point and community in this post. It might be worth zooming out and looking at those same numbers island wide since late Spring.

While active listings fluctuated over the last five months, the end of November supply for homes and condos is lower than it was at the end of June. Demand, reflected in pending listings, fell steadily downward over that time. While the data in this post shows that demand is far less than a normal market, we still have constrained supply. Demand fell enough to cool market conditions, but supply remains limited enough to prevent across the board decreases in value. Variability in market conditions on island ultimately comes down to the balance between supply and demand at the community level and at different price points. The price points that are decreasing in value appear to be those that have more financed buyers. The places that continue to see record highs have extremely limited inventory and a high percentage of cash buyers.

A Little Maui Beauty To Brighten Your Day

A beautiful sunrise taken from the beach in Wailea.

Witnessed a stunning sunrise from Wailea, Maui.✨ pic.twitter.com/4yRU7pndYl

— HAWAI'I Magazine (@HAWAIIMagazine) December 8, 2022

Contact The Maui Real Estate Team

Navigating the weird market conditions demands quality representation. Market strategies for buyers and sellers vary by price and location. Contact The Maui Real Estate Team to discuss market conditions specific to your budget and areas of interest. Our savvy and experienced agents look forward to being of assistance.

Well, we made it to our twentieth Market Musings. This post took me a while to put together. I want to say it’s because it is chock full of tremendous insight. The truth is my last 9-10 days consisted primarily of battling Covid. My symptoms made writing this post a protracted slog. Give me some grace if there are typos and/or a few not so coherent thoughts interspersed throughout the text.

In our last post, I talked about the relative resilience of the Maui market under higher rates. Since that time, rates rose even more. The additional bump in rates or perhaps just a longer duration of time with higher rates is weighing on the Maui market. The single family home market in particular is feeling the burden of higher rates and decreased affordability. Musings 20 takes a look at some of the current market indicators including active and pending inventory, price reductions and how quickly new listings are going under contract.

End of October Maui Single Family Home Inventory

	8/31/22		9/31/22		10/31/22
	Active	Pending	Active	Pending	Active	Pending
<$750,000	11	11	7	14	9 (+1)	15 (+1)
$750,000-$999,999	31	44	21	46	29 (+8)	29 (-15)
$1,000,000-$1,499,999	58	28	45	33	64 (+19)	28 (-5)
$1,500,000-$1,999,999	46	13	44	17	41 (-3)	13 (-4)
$2,000,000-$2,999,999	36	12	33	12	35 (+2)	10 (-2)
$3,000,000-$4,999,999	32	11	35	11	32 (-3)	7 (-4)
$5,000,000-$9,999,999	26	5	27	6	26 (-1)	5 (-1)
$10,000,000-$19,999,999	11	0	11	0	9 (-2)	0
$20,000,000+	5	0	2	1	3 (+1)	1
Totals	256	124	225	140	248 (+23)	108 (-32)

	8/31/22		9/30/22		10/31/22
Haiku	20	7	24	7	28(+4)	9 (+2)
Hana	8	2	9	1	10 (+1)	0 (-1)
Ka’anapali	10	4	10	3	7 (-3)	2 (-1)
Kahului	11	25	7	26	16 (+9)	16 (-10)
Kapalua	4	1	4	0	6 (+2)	0
Kihei	44	16	35	16	40 (+5)	11 (-5)
Kula	24	10	22	11	20 (-2)	11
Lahaina	23	7	21	10	22 (+1)	13 (+3)
Makawao	15	11	13	11	13	9(-2)
Napili/Kahana/Hono…	14	4	9	7	11 (+2)	6 (-1)
Pukalani	8	5	6	7	8 (+2)	3 (-4)
Spreckelsville/Paia	15	3	10	4	8 (-2)	2 (-2)
Wailea/Makena	16	4	10	8	11 (+1)	4 (-4)
Wailuku	41	22	36	26	40 (+4)	21 (-5)

End of October 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 and community with the most activity.

• After a pretty healthy drop in Inventory in September, active home listings increased by 10.22% by the end of October.
• The bulk of the inventory increased occurred between $750,00 and $1,500,000 with an increase of 27 listings in that range.
• It appears that this increase in inventory stems more from slower activity than an influx of new listings. That is reflected in the pending sales data with 20 fewer pending home sales between $750,000 and $1,500,000.
• This make sense as this is an area of the market where a higher percentage of buyers are using financing. Looking at all of the sales between August 1 and October 30th, 18.93% of the buyers in this price range paid cash. In all other price ranges, 41.77% of buyers used cash. Plain and simple, the increase in mortgage rates is hitting this segment of the market harder.
• Overall, the number of pending home sales decreased 22.86% between the end of September and the end of October. That is a substantial decrease, but worth noting that pending sales typically decline in the fall.
• Looking at the market on a community level, all but three districts increased inventory. The exceptions being Kula, Spreckelsville/Paia and Ka’anapali. Ka’anapali’s decrease stemmed in part due to cancelled listings rather than increased sales.
• Kahului experienced the biggest increase in active listings and the biggest decrease in pending sales. With the vast majority of the inventory in this community priced between $750,000 and $1,300,000, this is a market where the increased rates appear to causing a bigger shift in conditions.

End of October Condo Inventory

	8/31/22		9/30/22		10/31/22
	Active	Pending	Active	Pending	Active	Pending
<$250,000	1	6	1	3	2 (+1)	4 (+1)
$250,000-$499,999	14	17	11	16	19 (+8)	12 (-4)
$500,000-$749,999	34	43	28	40	32 (+4)	35 (-5)
$750,000-$999,999	33	43	33	33	27 (-6)	27 (-6)
$1,000,000-$1,499,999	29	31	19	36	21 (+2)	30 (-6)
$1,500,000-$1,999,999	24	35	18	34	14 (-4)	33 (-1)
$2,000,000-$2,999,999	22	38	14	43	15 (+1)	40 (-3)
$3,000,000-$4,999,999	12	19	10	17	10	17
$5,000,000-$9,999,999	8	1	7	0	11 (+4)	1 (+1)
$10,000,000+	4	0	4	0	3 (-1)	1 (+1)
Total	181	233	145	222	154 (+9)	200 (-22)

	8/31/22		9/30/22		10/31/22
	Active	Pending	Active	Pending	Active	Pending
Ka’anapali	25	16	17	14	18 (+1)	9 (-5)
Kahului	3	7	3	4	5 (+2)	5 (+1)
Kapalua	11	6	10	4	12 (+2)	4
Kihei	50	63	48	61	43 (-5)	60 (-1)
Lahaina	9	10	5	7	8 (+3)	4 (-3)
Ma’alaea	3	6	4	4	3 (-1)	6 (+2)
Napili/Kahana/Hono…	45	25	29	30	33 (+4)	17 (-13)
Wailea	24	86	19	86	19	85 (-1)
Wailuku	9	14	8	12	11 (+3)	10 (-2)

End of October 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. Overall, 46.5% of the pending Condo inventory is in La’i Loa or Paradise Ridge Estates.

• After three straight months of decreased inventory, condo inventory increased by a modest 6.2%
• The largest increase in inventory occurred in the $250,000 to $499,999 price range. While this price range has a lower percentage of cash buyers than the overall condo market, the difference isn’t all that substantial.
• Active inventory increased in 6 out of 10 price ranges, decreased in three and stayed the same in one.
• Pending sales decreased 9.91% this month. As with home sales, it isn’t too uncommon to see pending sales decrease this time of year.
• The decrease in pending condo sales by price point was fairly consistent through most ranges, with the exceptions being the very lowest price range and the very highest price points in the market.
• At the community level, modest increases in inventory were common across the board. The two districts that actually saw a decrease in inventory at the community level were Ma’alaea and Kihei. Both are markets with a lot of vacation rentals. This is a market segment that is still seeing decent demand.
• Napili, Kahana and Honokowai experienced the biggest drop in pending sales. This is another big vacation rental condo market. Is the difference in activity levels a case of no clear narrative or just variability? This is something to watch with next month’s numbers.

How Quickly Are Properties Going Under Contract

One other metric we use on the blog to track market demand is how quickly properties are going under contract. Specifically, what percentage of new listings are going under contract in ten days or less. The very first time we started documenting this metric was back in February. At that point, 56% of all new listings went under contract within 10 days or less. Between September 12th and 19th, that number shrank to 34%. Between October 11th-18th, the number of properties that went under contract within 10 days or less fell further to 25.58%.

When you break it down by homes and condos, you can see that condos continue to show some measure of resilience. For condos listed between October 11th and 18th, 40% went under contract with buyers in ten days or less. That’s actually up from mid September when the number was 36.66%. For additional context, 66.67% of condos went under contract in 10 days or less between October 11th and 18th, 2021. Going back to 2019, 26% of all condos listed between October 11th and 18th went under contract in 10 days or less.

The numbers for the home market point to a more pronounced cooling. Only 13.04% of all homes listed between October 11th and 18th went under contract in 10 days or less. In mid-September, that number was 32.14%. For additional context, 54.17% of homes listed between October 11th and October 18th, 2021 went under contract in tend days or less. Going back to 2019, 9.09% of all homes listed between October 11th and October 18th, went under contract in ten days or less.

Price Reductions

One market indicator that surprised this month is the number of active listings with price reductions. Nationally, price reductions continue to rise as the real estate market slows under the weight of higher interest rates. Based on the numbers above, one might expect to see more price reductions, particularly with the home market. With fewer properties going under contract quickly and fewer properties going under contract in general, shouldn’t sellers be adjusting to the market?

As of the the 31st, 90 of 248 active home listings or 39.92% reduced their price one or more times. On September 29th, 42.41% of homes went under contract in 10 days or less. On September 2nd, 42.97% of all active listings had one or more price reduction.

On the condo front, 45 of 153 or 29.41% of active condo listings on October 31, 2022 reduced their price one or more times. That’s up from 25% on September 29th. On September 2nd, 27.84% of all active condo listings had price reductions.

Some General Thoughts on the Numbers Above and The State of The Market

It’s been an interesting last six months in the Maui Real Estate market. The first quarter of the year was largely a continuation of 2021. Strong demand combined with limited inventory to fuel strong price growth. Demand slowly started to taper in the second quarter. That said, inventory remained low. While the frenzy of the first quarter subsided, there was a balance between limited supply and just enough demand to make for a competitive market for buyers. While we were well below the frenzy of earlier in the year, homes and condos in particular sold faster and at a higher percentage of asking price than they would in a normal market.

This trend of a balanced ratio between buyers and sellers continued through the summer. Inventory actually contracted through most of the summer, but we lost FOMO (fear of missing out) buyers from the market. The lack of FOMO buyers had an impact. We started to see some downward pressure on values in limited parts of the market. With a discerning buyer pool, flawed properties that would have sold easily in the first quarter weren’t getting any love from buyers.

In my last musings, I showed stats that pointed to the relative resilience of this market despite rates well over 6%. The stats above point to a further shift downward in the market . Or at least two out of three did. The third is a reflection of Maui as a real estate market as a whole.

The increase in inventory and the decrease in pendings show a market where the balance in supply and demand is starting to shift. This is less due to an influx of new inventory as much as it is to decreased demand. When you look at the number of homes going under contract within 10 days or less, you can see where the push above 7% rates is starting to decrease the number of buyers. I am sure the more negative national real estate news is also having an impact on the buying decisions of some. Fomo has been replaced by wait and see.

The decrease in price reductions is the one anomaly in this market. As the market cools, you would expect sellers to adjust. Prior to Covid, Maui’s market dynamics were different than the typical mainland market. Sellers took time to adjust prices and days on market could really pile up before a listing was considered stale. It’s also worth remembering that this shift is pretty recent. We may need to see these conditions persist for a longer before more sellers begin to adjust prices.

The one other thing to note is that while we saw a shift in market conditions in these most recent stats, conditions remain variable. That’s pretty clear when we look at the difference between homes and condos. As of mid-October, new condo listings still went under contract much faster than they did pre-Covid. Condo inventory remains tight compared to demand and the volume of cash buyers blunts the impact of higher rates.There is variability in the home market too. The luxury market, which again includes a higher percentage of cash buyers, appears to be moving relatively well.

Looking forward, it will be interesting to see where the market goes from here. Since it’s taken me longer to write this blog post, I have the advantage of watching market conditions over the first ten days of November. While I haven’t crunched the numbers in any detail, pending sales stabilized to start the month. Yesterday’s inflation print out caused a shift in the bond market and mortgage rates to drop a half a point.Will that persist or will higher rates return? Needless to say, it’s too early tell. If anything, this points to continued weird market dynamics with a lot of variability in conditions.

A Little Maui Beauty to Brighten Your Day

It may not be Monday but…

It's Monday- we're mentally here. Via @HIOceanProject pic.twitter.com/gzQN8hpHwr

— Maui Hawaii (@Maui) November 7, 2022

Contact The Maui Real Estate Team

Variable market conditions and general market weirdness demand quality representation. Contact the Maui Real Estate Team to talk to one of our experienced agents if you are thinking of buying or selling Maui Real Estate. One of our healthy agents will be happy to learn more about your real estate needs. We look forward to being of assistance.

It’s been a few weeks since our last Maui Real Estate Market Update. With that in mind, this post delves into the numbers that help cast a light on current Maui market conditions. Since our last post, interests rates surged higher again putting additional pressure on affordability for some buyers. This post looks at what impacts if any higher rates are having on the Maui market. We also look at current inventory levels by price point and community. Other subjects for discussion include cancellations, price reductions and the recent market response to new listings. This is a longer read so you may want to grab your favorite caffeinated beverage before proceeding further. It is not advisable to operate heavy equipment after reading.

Interest Rates

It’s hard not to lead with interest rates when discussing the state of the market. Rates continued their climb since our last update. While they fluctuate daily, they’ve been somewhere between 6.5% and just over 7% over the last few weeks. Needless, to say, we are a long way from the sub 3% interest rates we saw during periods of 2021. For those hoping that this increase is going to be short lived, the recent comments of Fed Chair Jerome Powell suggest that is unlikely to be the case. Powell said higher rates are needed to bring about a “correction” and balance to the housing market. While the Fed doesn’t directly control mortgage rates, they can exert a strong influence with changes to the Federal Funds rate.

Higher rates (even rates lower than current rates) were already impacting real estate markets around the country. Values are starting to retreat in many markets, particularly in some of the frothiest markets of the last couple of years.

So what kind of impact are we seeing on Maui from higher rates? There are a couple of numbers that we look at in this musings that might reflect the impact of higher rates. Pending sales is one with decreased affordability likely to impact the number of buyers. Price decreases is another metric that would or should reflect sellers adjusting to decreased buyer demand. Keep reading to see what those numbers look like recently on Maui.

Maui Home Inventory

	7/31/22		8/31/22		9/30/22
	Active	Pending	Active	Pending	Active	Pending
<$750,000	11	14	11	11	7 (-4)	14 (+3)
$750,000-$999,999	25	62	31	44	21 (-10)	46 (+2)
$1,000,000-$1,499,999	65	34	58	28	45 (-13)	33 (+5)
$1,500,000-$1,999,999	41	19	46	13	44 (-2)	17 (+4)
$2,000,000-$2,999,999	31	19	36	12	33 (-3)	12
$3,000,000-$4,999,999	25	9	32	11	35 (+3)	11
$5,000,000-$9,999,999	24	7	26	5	27 (+1)	6 (+1)
$10,000,000-$19,999,999	12	0	11	0	11	0
$20,000,000+	5	1	5	0	2 (-3)	1 (+1)
Totals	239	156	256	124	225 (-31)	140 (+16)

	7/31/22		8/31/22		9/30/22
	Active	Pending	Active	Pending	Active	Pending
Haiku	22	11	20	7	24 (+4)	7
Hana	4	1	8	2	9 (+1)	1 (-1)
Ka’anapali	10	7	10	4	10	3 (-1)
Kahului	13	21	11	25	7 (-4)	26 (+1)
Kapalua	5	1	4	1	4	0 (-1)
Kihei	48	14	44	16	35 (-9)	16
Kula	19	16	24	10	22 (-2)	11 (+1)
Lahaina	18	14	23	7	21 (-2)	10 (+3)
Makawao	14	9	15	11	13 (-2)	11
Napili/Kahana/Hono…	10	6	14	4	9 (-5)	7 (+3)
Pukalani	7	6	8	5	6 (-2)	7 (+2)
Spreckelsville/Paia	10	2	15	3	10 (-5)	4 (+1)
Wailea/Makena	15	5	16	4	10 (-6)	8 (+4)
Wailuku	39	35	41	22	36 (-5)	26 (+4)

End of September 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 homes fell 12.2% between the last day of August and the last day of September.
• Active inventory decreased in all price ranges below $3,000,000. There was a modest increase in inventory between $3,000,000 and $10,000,000, no change between $10,000,000 and $19,999,999, and a decrease in inventory above $20,000,000.
• Pending sales activity increased 12.9% over last month! This is a surprising reverse of recent trends. It is an especially big surprise with the recent mortgage rate increases.
• The biggest increase in pending sales occurred below $2,000,000. Above that price range the number of pending sales was either steady or increased by one. No price ranges experienced a decrease in pending sales activity. It is worth noting that the $10,000,000 to $19,999,999 range had no pending sales as of the end of August and still has no pending sales.
• Looking at the different communities around the island, only two communities saw an increase in inventory. Haiku and Hana both saw modest increases in active listings. Anecdotally, it seems like some sellers in these windward communities try to get homes on to the market before the start of the rainy season later in the fall. I haven’t taken the plunge to determine if there is any quantitative evidence to support that claim.
• After seeing big growth in inventory in late Spring and early Summer, Kihei saw the biggest decrease in active inventory for the second month in a row. Notably, the total number of pending sales in Kihei did not change. With that in mind, I decided to look a little closer at the Kihei market activity. While Kihei added 8 new pending sales this month, 7 sales closed, 8 listings cancelled and 2 expired. Only 4 new listings came to market. Based on those numbers, the reason for the decrease in inventory is multi-faceted. The cancellations could be a sign of seller capitulation (more on that below) or just sellers taking a break. We shall see.
• Wailea and Wailuku are the two communities that saw the biggest increase in pending sales with 4 net new pendings. Wailea’s increase is a little more notable due to the percentage increase in pending sales. It’s worth mentioning that 4 of the 5 overall new pending sales in Wailea and Makena reduced prices before going under contract. There’s something to be said for listening to market feedback and adjusting price.

Maui Condo Inventory

	7/31/2022		8/31/2022		9/30/2022
	Active	Pending	Active	Pending	Active	Pending
<$250,000	1	8	1	6	1	3 (-3)
$250,000-$499,999	11	23	14	17	11 (-3)	16 (-1)
$500,000-$749,999	43	39	34	43	28 (-6)	40 (-3)
$750,000-$999,999	44	43	33	43	33	33 (-10)
$1,000,000-$1,499,999	30	31	29	31	19 (-10)	36 (+5)
$1,500,000-$1,999,999	30	33	24	35	18 (-6)	34 (-1)
$2,000,000-$2,999,999	20	36	22	38	14 (-8)	43 (+5)
$3,000,000-$4,999,999	12	18	12	19	10 (-2)	17 (-2)
$5,000,000-$9,999,999	10	3	8	1	7 (-1)	0 (-1)
$10,000,000+	4	0	4	0	4	0
Totals	205	234	181	233	145 (-36)	222 (-11)

	7/31/2022		8/31/2022		9/30/2022
	Active	Pending	Active	Pending	Active	Pending
Ka’anapali	24	13	25	16	17 (-8)	14 (-3)
Kahului	2	8	3	7	3	4 (-3)
Kapalua	10	10	11	6	10 (-1)	4 (-2)
Kihei	67	60	50	63	48 (-2)	61 (-2)
Lahaina	16	8	9	10	5 (-4)	7 (-3)
Ma’alaea	5	6	3	6	4 (+1)	4 (-2)
Napili/Kahana/Hono	40	34	45	25	29 (-16)	30 (+5)
Wailea	25	82	24	86	19 (-5)	86
Wailuku	14	13	9	14	8 (-1)	12 (-2)

End of September 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. Overall, 41.89% of current pending sales are long term new developer contracts.

• The number of active condo listings at the end of September is 19.89% lower than at the end of August.
• Active inventory decreased in seven out of ten price ranges in the table above. Net inventory was unchanged in the remaining 3 ranges.
• Pending condo sales dropped 5.2% compared to the end of August. Is this a reflection of reduced inventory, reduced demand or both? It’s hard to say. That said, I did get a surprising number of e-mails last month from fellow Realtors seeking out condo inventory for buyers struggling to find what they want.
• Pending sales dropped in seven of ten price ranges. Pending sales increased between $1,000,000-$1,499,999 and $2,000,000 and $2,999,999.
• Ma’alaea is the only community where inventory increased last month albeit with just one more active listing than at the end of August. Kahului’s inventory is unchanged.
• Napili, Kahana and Honokowai experienced the biggest decrease in inventory with 16 fewer listings at the end of this month. It was also the only community where pending sales increased. The eighteen new pending sales shows pretty healthy activity. It seems that the increase in pending sales is the biggest driver for the decrease in active listings in this market, but cancelled listings were also a factor. Seven sellers pulled their listings off the market.

Cancelled Listings

September is a transitional month on Maui. The summer tourism season is over and we are still a few months from our peak winter season. Anecdotally, I always thought of this as a month where some sellers will opt to take a pause from selling their home only to relist when it gets closer to winter tourism season. With the sharp decrease in active listings this month, I wanted to look closer at cancelled and expired listings. Is September actually a bigger month for cancellations historically? If so, how does this year compare to previous years? Is there anything that can be gleaned from this September’s high cancellations?

	2022	2021	2019	2018	2017
January	27	23	48	37	55
February	21	9	41	43	34
March	18	15	39	36	58
April	19	17	37	39	77
May	13	22	48	40	89
June	19	16	31	27	53
July	17	22	40	30	58
August	27	16	25	44	62
September	40 (1)	28 (2)	39 (t6)	50 (1)	41 (11)
October	TBD	16	37	47	60
November	TBD	30	36	47	60
December	TBD	20	43	29	45

	2022	2021	2019	2018	2017
January	19	55	27	42	55
February	13	54	38	15	34
March	12	54	27	41	58
April	14	35	43	38	77
May	15	21	54	37	89
June	11	20	37	26	53
July	11	16	23	43	58
August	20	19	21	27	62
September	29 (1)	13 (11)	43 (t2)	44 (3)	41 (11)
October	TBD	15	37	49	60
November	TBD	15	40	65	60
December	TBD	11	30	41	45

Before discussing the numbers above, it is worth noting that there is some noise when it comes to cancelled listings. An agent changing brokerages or one brokerage buying another can inflate cancelled listings. The change in brokerages results in cancelled listings immediately replaced by new listings as old listing contracts are cancelled and new contracts created. I noticed some noise in this month’s cancelled home listings. Hoku’ula, a new development Upcountry, cancelled their MLS listings last month and put them back on the market as new listings at a higher price.

With that framework, let’s address the first question that I posed above. Is September a bigger month historically for cancellations? It appears to be one of the biggest months for canceled home listings albeit with some notable exceptions in the chart above. For condos, it is a little more extreme. Some years it is near the top and others near the bottom with no clear cut reason for the variability.

So what does that say about this year? Even without those five Hoku’ula cancellations, September would still be the highest month for home cancellation for the year to date. September is also leading for cancelled condo listings despite rather limited inventory. It’s hard to say definitively if this is strictly seasonal or if any of those cancellations are due to seller capitulation. That said, it would make sense if we start to see some sellers retreat from the market for non-seasonal reasons. Sellers who were fishing for ultra high prices, don’t need to sell or need to borrow at higher rates to buy a new place could all have reason to pull their listing under current conditions.

Price Reductions

Recent increases in interest rates are generating more price reductions nationally. Sellers are reacting to the decreased affordability posed by higher rates. What about the Maui market? Are we seeing similar trends? I looked at price reductions for active inventory on September 29th.

As of the 29th, 95 out of 224 active listings or 42.41% of all properties reduced their price one or more times. As of September 2nd, that numbers was 42.97%. On August 15th, it was 39.67%. While price reductions are up since the early summer, the more recent decrease in price reductions is somewhat surprising in light of the recent increases in rates.

On the condo front, 36 out of 144 active listings reduced their price one or more times. That calculates to 25% of active inventory. That is down from 27.84% on September 2nd and 29.62% of all listings on August 15th.

With inventory shrinking, perhaps sellers are feeling emboldened to stick to their guns on pricing. The higher level of cash and or low inventory levels seem to be making this market less responsive to interest rate changes thus far.

How Quickly Are New Listings Going Under Contract?

Another metric we continue to watch in the musings is how quickly things are going under contract. Specifically, what percentage of listings are going under contract within 10 days or less. We started tracking this in mid-February when the number was right around 56%. That was pretty much the peak of our winter frenzy. For properties that were listed between September 12th and 19th, 34% of all listings went under contract within 10 days. That is actually up from 29.79% between August 10th and 17th.

For home listings, 32.14% of new listings between September 12th and September 19th went under contract within 10 days or less. By comparison, 38.1% of all homes listed between 9/12/21 and 9/19/21 went under contract in 10 days or less. For a pre-covid comparison, 41.18% of all homes listed between 9/12/19 and 9/19/19 went under contract within 10 days or less. It is worth mentioning that 41% is a much higher percentage than other weeks we’ve looked at in 2019. For example, only 19.04% of homes listed between 9/27/2019 and 10/3/2019 went under contract in 10 days or less.

For condo listings, 36.36% of all new listings went under contract within 10 days between September 12th and 19th. Last year, an eye popping 67.74% of condos listed between 9/12 and 9/19 were under contract in ten days or less. In 2019, 27.27% of all condos listed between 9/12 and 9/19 went under contract within 10 days or less.

Overall, the market is way less frenzied than last year. However, properties are going under contract faster than in a “normal” Maui market. There are definitely fewer buyers, but there are enough buyers out there for the limited supply that over one third of the inventory is going under contract quickly.

A Few Closing Thoughts on the State of the Maui Market

The numbers compiled above paint a picture of a more resilient Maui market than one might expect. We actually saw fewer price reductions for homes and condos while pending home sales increased! Not exactly the market response one would predict when interest rates increase to their highest point in 15 or more years. It appears at this point that limited inventory is still having a significant impact on the market despite the rising borrowing costs.

Will that sustain itself through the rest of the year and into early 2023? I was suprised by this month so who knows what the future will hold. It’s likely that the market has yet to feel the full weight of higher interest rates. Add in signs of a slowing economy and our market is facing additional headwinds. Ultimately, the Maui market moving forward will be a balancing act between the impact of higher rates and supply constraints. Conditions well vary around Maui by both price point, location and property type.

With interest rates likely to remain elevated into the immediate future, more real estate economists are anticipating price corrections. Reading beyond the headlines, economists expect variability in market corrections across the country. Rates will be a market driver, as will the state of the economy and local inventory. It’s important not to base market decisions on national headlines, but instead on relevant local data. We plan to continue with our Musings and community market updates so Maui buyers and sellers have the data to make informed decisions.

A Little Maui Beauty to Brighten Your Day

#FridayFeeling: Aloha 🤗💗🌺🏝

NEW dose of #Hawaii #calm: https://t.co/vHfJIYL4Kl

📍 Big Beach, #Maui pic.twitter.com/nuHWkx097S

— Tranquilitee (@MyTranquilitee) September 30, 2022

Contact The Maui Real Estate Team

Questions about the post above? Wondering about conditions in a specific part of the Maui Market? Need assistance buying or selling a property on Maui? Contact The Maui Real Estate Team for assistance. One of our experienced and savvy agents would welcome the chance to sit down with you to discuss your real estate needs.

Post Updated September 29, 2022

It’s time for an excursion to West Maui as we continue our series of posts on market conditions in different communities around the island. The focus of today’s post is Ka’anapali. This resort community experienced a boom in activity during 2021 with rising prices and a high volume of sales. How has the market been in 2022? Find out more below as we look at year to date numbers for 2022 with numbers from 2021 and 2019 provided for comparison. There are also a few thoughts on the outlook for the rest of the year and early 2023.

Ka’anapali Home Market Numbers

• Maui Realtors reported 20 homes sold for the year to date as of September 23. That is 59.2% less than the 49 sales reported over the same period of 2021. It is 11.11% higher than the 18 reported in 2019.
• The median price of homes sold in 2022 is $2,650,000. That is 11% higher than $2,387,000, last year’s median over the same period. It is 77.91% higher than $1,489,500, the median during the same period of 2019.
• The average price of the homes sold in Ka’anapali during 2022 is $2,855,552. That compares to an average of $3,017,891 and $1,994,037 during the same periods of 2021 and 2019 respectively. This year’s average is 5.38% lower than last year and 43.2% higher than 2019.
• 20% of this year’s buyers paid over asking price for their home and 45% paid asking price or above. In 2021, 12.24% of buyers paid over asking price and 28.57% paid asking price or above. In 2019, no buyers paid over asking price and 11.11% paid full price.
• Realtors reported 30% of sales were cash transactions.
• The highest priced transaction this year closed for $5,295,000. The property in the Lanikeha subdivision included a 3 bedroom, 3.5 bathroom home with 3,086 square feet of living space and a 1 bedroom, 1 bathroom, 508 square foot cottage on a .485 acre lot.
• The lowest priced sale for the year to date closed for $1,681,050. The bank owned property in Ka’anapali Hillside actually sold via online auction for 46.17% over asking price. The home needed serious repair and renovation.
• The Ka’anapali Hillside subdivision had the most sales activity with 6 closes. Lanikeha and the Summit were the next busiest with 5 transactions each.

Thoughts on the Home Numbers and the Outlook for the Rest of the Year and Early 2023

After a rip roaring 2021 for sales, transaction activity decreased sharply this year in Ka’anapali coming in just above the pre-pandemic levels of activity during 2019. That said, decreased volume is just one part of the story. There was enough demand that 45% of all home sales closed for asking price or above. That’s even more than last year. When compared to 2019 numbers, that 45% is particularly striking. Back before the boom of the last couple years, above asking price offers were exceptionally rare and just over 10% of the buyers paid full price.

Some of the decreased sales volume can be attributed to a scarcity of listings at lower price points and within a couple of higher priced Ka’anapali neighborhoods. There were no transactions or even inventory in the Pinnacle this year, and just two listing and no transactions in Ka’anapali Coffee Farms. At this time, there is no active inventory for less than $3,000,000, with the only 2 listings below that price under contract.

Inventory isn’t as big of an issue as you move up in price range in Ka’anapali. Fifty percent of all the active inventory is priced between $5,000,000 and $7,000,000. Thus far one home sold in that price range with one additional home listed above $5,000,000 under contract.

It is worth comparing the homes that sold for between $5,000,000 and $7,000,000 last year with the current inventory in this price range. Last year’s sales included two large homes on acreage in Ka’anapali Coffee Farms and a 6,575 square foot home in the Pinnacle. While size isn’t everything when it comes to value, this year’s $5,000,000 and up listings tend to be smaller homes on smaller lots than last year’s sales. The active inventory includes four homes in Lanikeha with the largest home coming in at 4,557 square feet and a home in Kaanapali Coffee Farms substantially smaller than both of last year’s highest priced sales in that neighborhood.

It is also worth noting that all of the active listings in this range appear to be spec builds. There are two more spec builds in Lanikeha priced between $4,000,000 and $5,000,000. This volume of spec building is almost unheard of in the Maui Luxury home market. It will be interesting to watch the sellers of these spec builds through the rest of the year, especially if we see additional shifts in the market and or the economy. I surmise that it may take some pencil sharpening for some of those properties to go under contract.

As for overall Ka’anapali luxury home market activity in late 22 early 23, inventory constraints at lower price points will impact sales volume. Any additional sales beyond the current pendings will mostly come via new inventory or price adjustments. Rising borrower costs may also curtail activity. While there is a fair amount of cash in the market, rate increases will impact affordability for some buyers. Negative economic news and declines in the equity markets could also cause some buyers to put second home purchases on hold.

Ka’anapali Condo Market Numbers

• As of September 23rd, Maui Realtors reported 123 condos sold in Ka’anapali for the year to date. That is 37% fewer than the 194 that closed over the same period of 2021. It is 14.95% more than the 107 that sold during the same period of 2019.
• The Median price of the condos sold for the year to date is $1,450,000. This is 52.63% higher than the median of $950,000 from last year over this same span. It is 63.66% higher than the median for the same period of 2019.
• The average price of the condos sold for the year to date is $1,724,465. That is a 31.67% increase over last year’s average through September 23rd. It is 54.15% above the 2019 average during the same time span.
• 23.58% of all of the condos sold thus far this year sold for over asking price, and 47.15% sold for asking price or above. That’s well above last year’s numbers of 8.76% over asking and 44.33% for asking price or above. Just to give some context as to what is was like pre-Covid, in 2019 only 2.8% of sales sold for over asking and 16.82% sold for asking price or above.
• Maui Realtors reported that 51.21% of all sales were cash transactions. That’s up a little over the 50% reported last year. Cash purchases were actually higher at 59.81% in 2019.
• The lowest priced condo to sell in Ka’anapali is a leasehold studio unit in Ka’anapali Shores that closed for $325,000.
• The highest priced condo to sell closed for $5,899,000. The 3 bedroom, 3 bath unit in the Konea Tower at Honua Kai has 2,280 square feet of living space.
• Honua Kai is the busiest condo development thus far this year with 37 closed transactions. Ka’anapali Shoes is second busiest with 20 sales for the year to date. The Masters had the third most inventory with 15 sales.

Ka’anapali Year to Date Review and Late 2022 Early 2023 Market Outlook

While the Ka’anapali Condo market for the year to date did not see a repeat a the astounding sales volume of 2021, it remained a busy market well above the levels seen in 2019. If anything, constrained inventory and continued demand made for a more competitive market than last year with more properties closing for over asking price. The market conditions meant continued upward pressure on prices.

As it stands, the vacation rental and second home condo market continues to be resilient as some other types of property on island start to feel a market shift. As of the 26th of September, there are only 17 active condo listings on the market in all of Ka’anapali. Limited inventory improves the position of sellers and continues to exert at least some upward pressure on pricing. It will be interesting to see how the limited supply balances out against demand. Again, the cash in this market makes it a little less interest rate sensitive, but there is still some impact. As of right now, a 30 year fixed on a vacation rental condo is being quoted as high as 8.5%. Needless to say, a lot of borrowers are opting for ARM products. Even those are a lot more expensive.

The chart above shows pending condo sales by month in Ka’anapali over the last five years. A few things worth noting when looking at the chart. The first things is that 2021 and 2020 are anomalies with 2019 and 2018 more normal markets. If you are wondering about the April 2018 spike in pending sales, the market got a boost from a new development, Honua Kai Luana Gardens Villas. It’s also worth noting that while 2022 pending sales started stronger than 2019 and 2018, monthly pendings for 2022 are running behind both 2019 and 2018 since May. The last thing is that while there is a little more activity in the first half of most years, the second half of the year sees steady activity. I would suspect that we will see “below normal” market activity through the rest of the year.

Based on inventory and seasonality, I would anticipate relatively limited sales volume to close out the year. With the amount of inventory available, the economy in flux and borrowing costs the highest since 2002, it looks like a quieter start to 2023 could be in order. We shall see what happens going forward.

Contact The Maui Real Estate Team

Contact The Maui Real Estate Team if you have questions about this post or if you need assistance buying or selling property in the Ka’anapali area. You can find all of the current active Ka’anapali Homes for Sale, Ka’anapali Condos for Sale and Ka’anapali Land for Sale on MauiRealEstate.com.