Looking at overall market statistics for either the U.S. as a whole or for individual states, it is becoming increasingly evident that the market has found its bottom, and is in the very early stages of recovery.
Take a look at the Federal Housing Finance Agency website where they compare Hawaii, California, and Washington prices on a quarter by quarter basis with previous year’s figures. You can see that prices showed a dramatic improvement in the latest quarter.
In fact, California, which was hit the hardest actually bottomed out in the 3rd quarter of 2008, whereas Hawaii, reached bottom in the 2nd quarter of 2009. This is the normal pattern where Hawaii lags about 6 months behind California.
An additional impetus to price stabilization and improvement has been the extremely low interest rates. One of the reasons why interest rates have been so low is due to the Feds purchase of Mortgage Backed Securities. This program is ending in March 2010, so we expect that interest rates will most likely climb to the 6 to 7% range.
We want to wish you all a very Merry Christmas and a Happy Chanukah.
Have a wonderful week!
Mahalo Nui Loa,
The Smith Team
P.S. Are you looking for development opportunities? We have projects where we are looking for investors in the $3 to 100 Million range. Contact us if you are interested in learning more about some of the incredible opportunities available on Maui today. Five years from now, you’ll be very happy if you act now. This goes for any purchases that are made today. We are in the very early stages of a bull market for Maui real estate.
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While many Maui businesses are still in the midst of economic upheaval, there are some signs that recovery is on the horizon. Slowly but surely, markets have been improving and the Maui real estate market has seen some promising growth in the past month.
One of the most hopeful signs is the fact that condo sales and home sales throughout Maui have seen a moderate boost in November. In fact, compared to last year, there have been 2 more sales of single-family homes this year. While 67 sales, compared to 65 sales in November of 2008, is not at the level of peak sales, it’s still good to see some improvement. Moreover, median prices were only down 1 percent this month which is a bit better than experts had predicted.
However, when you talk about condo sales, here’s where the figures really start to point to recovery. In November 2008, a mere 29 condo sales were recorded while this November saw that figure jump to 69 condos sold. While prices had not changed much, the median price for a condo this November has improved by about $1000 from a year ago to $400,000.
More surprisingly, airlines are starting to increase the number of direct flights to Maui. Continental Airlines, for example, is improving their direct service from Southern California to Maui. At the moment, they’re offering daily service to Maui from Los Angeles and have just announced a plan to add four direct flights from Orange County. Similarly, Alaska Airlines is offering new flights to Maui. Clearly, these efforts to enhance service to Maui indicate that tourism is likely to pick up on the island again.
Cynics of course would argue that Maui has a long way to go before the economy is completely recovered, and this is very much true. But for the first time in the better part of a year there is reason to be optimistic about the economic future of the island and with the holiday season upon us we should be counting our blessings.
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Unusually, West Maui Land Co. has been looking to offload a number of large lots through auction. This undeveloped land was available to bidders who were looking for land adjacent to the West Maui forest reserve. As property sales throughout Hawaii have been dwindling recently, the West Maui Land Co. had decided to take a somewhat novel approach in an attempt to finalize the sale of at least 5 lots before the end of the year. Five lots, with one in escrow, have already been sold this year and at bargain prices as well.
Last year, the West Maui Land Co. had hoped to get upwards of $1.6 million for these lots but sales have fallen in the $695,000 to $900,000 range representing a considerable savings for interested investors. Despite difficulties comparing year-to-year sales of Maui land, because of variations in sales with regards to numbers and character, it should still be mentioned that there has been a steep decline in interest in Maui real estate since 2006. In fact, since then sales figures have steadily declined from $266 million in 2006 to $190 million in 2007, down to a meager $94 million last year. While sales have improved slightly in 2009, we’re at $106 million through 10 months; the real estate market is considerably weaker since financial markets began to weaken.
Auctions for Maui Land Co. were limited to individuals with cash or instant credit as the opening bids started at $500,000 and sales were to be finalized before December 21st. The auctions had been advertised exclusively in Hawaii, most prominently in local newspapers, and generated a fair amount of interest. Maui Land avoided offshore interest for a couple of reasons. Namely, there were some time restrictions with regards to advertising in internationally circulated publications and the fact that buyers were required to attend with a broker.
Interested parties were involved in the auction of lots ranging from 25 to 50 acres that all exceeded 700 feet in elevation. While the lots are fairly steep, the forest reserve line is about 1,400 feet, some of them are as deep as 2,000 feet. Moreover, roads and utilities were already set up.
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- Dec
- 13
Help for Maui Short Sellers
Have a wonderful week. On November 30, 2009, U.S. Department of the Treasury announced the Home Affordable Foreclosure Alternatives Program (HAFA), which provides financial alternatives to servicers, borrowers, and investors for a closed short sale or a deed-in-lieu of foreclosure (DIL). HAFA encourages foreclosure alternatives to costly and expensive foreclosures.
The HAFA program simplifies and encourages short sale and DIL options by: Offering eligible borrowers viable alternatives to avoid foreclosures.
Providing a standardized process and time frames for handling viable alternatives.
Allowing pre-approved short sale terms before a property is listed.
Preventing servicers from attempting to reduce real estate commissions established in the Listing Agreement as a condition for short sale approval.
Releasing borrowers from future liability for the debt; Providing financial incentives to borrowers, servicers, and investors.
For more information about HAFA, read the Supplemental Directive using the link above or find this and other Making Home Affordable information at HMPadmin.com.
If you are in a situation or know someone that is upside down on their loan, and needs to sell, this is welcome news. We have a lot of experience dealing with Short Sales, so please allow us to help you or your friends.
Have a wonderful week!
Mahalo Nui Loa,
The Smith Team
P.S. The big news on Maui last week was the monster surf going off on the North Shore. Read more about the 50 foot plus waves hitting today at Jaws.
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Although prices have not started rising yet; we have seen a large increase in the number of sales here on Maui which parallels what is happening across the country. Read more.
This is also apparent by looking at the number of Active Listings. This week, there are 886 active listings of homes for sale on Maui. In March of this year, there were 1061 Active Listings, a drop of 17% in less than a year.
In addition, the number of Pending Sales has almost doubled. All in all, this is harbinger of good times ahead, in our opinion. We expect 2010 to continue this positive trend.
Our featured property this week, Hale O’ Ola, is one of the finest homes on Maui, and in one of the best locations. Check out their website, which has lots of great information including a link to some of the scenes that were shot for the reality TV show, America’s Next Top Model. It should be obvious why they selected this home as a backdrop for many of their scenes as well as to house the models while they were shooting on Maui.
Have a wonderful week.
Mahalo Nui Loa,
The Smith Team
P.S. Please ask us about Auto-Notification, so that you never miss out on the opportunity to purchase the property of your dreams.
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