Since the middle of 2008, the Maui real estate market has experienced its share of woes. In just about every measurable real estate statistic, the market in Maui took some blows but recent findings show that sales and prices are making positive moves recently. Indeed, comparing the first three quarters of 2010 with the same period in 2009 we see that sales jumped 33% from 462 in 2009 to 616 Maui County.
In addition, property prices also seem to be on the rise. While there are still some bargains to be found around Maui, the overall picture is certainly looking brighter. Average prices in Maui grew 10% to $779,769 suggesting real estate is trending upwards.
Nevertheless, the availability of foreclosure properties represents real opportunities for savings for interested buyers. In a recent Maui foreclosure auction, the auction of a Harbor Lights Condominium unit saw no bids despite a default amount of just $4,373. Similar stories appear to be commonplace, even if the bargain isn’t so substantial, but local experts are concerned that the availability of foreclosure properties at a considerable discount is doing little to buoy the market.
In fact, many experts cannot even agree as to whether the Maui market has reached bottom. Some predict prices will continue to fall, despite evidence to the contrary. Many economists feel that the market in Maui has no way to move but up, but local agents claim otherwise.
Another factor that is making the market difficult to read is the fact that many major banks have stayed foreclosure operations. Nevertheless, Maui is seeing unprecedented interest from international buyers. Local buyers are certainly returning to the market, likely to take advantage of the seemingly endless numbers of foreclosure notices. Indeed, it seems as though banks are acquiring repossessed homes more often than selling them.
To return to the Harbor Lights example, the MLS showed 15 units were recently up for sale. One of those units was bank-owned, and 12 were short sales. To add to the concern, the current supply of condos and properties is likely enough to satisfy demand for up to 15 months. Listed condos are usually sold within 130 days while houses sell in about 122 days.
The current real estate conditions suggest that the market for single-family homes is looking more favorable than the market for condos, while median prices are down for all properties. So, while single-family home prices have risen 10 percent the median has fallen 8 per cent. With regards to condos, average prices are down 9 per cent and the median has dropped a staggering 21 per cent. Subsequently, there is also an increased volume of available condos.
Still, the bad news continues to be tempered by good news as far as Maui real estate goes. The turnover for single-family transactions has risen 47 per cent to $480 million, while the turnover for condo sales is also up 36 per cent to $624 million in 2010.
Some experts point to the fact that just a few large sales can inflate averages in different communities. Take Kapalua as an example where there have been 7 closings through September of this year, while the same period last year saw just 4 closings. Still, in this community average prices leaped 81 per cent to $4 million while the median price rose only 28 per cent to $3 million. The variability in these statistics suggests that the sale of a few large homes drove up the average price while having a less significant effect on the median. Meanwhile in Kapalua, condo prices are down while sales are up.
In short, there is certainly cause for optimism in Maui but the story is yet to be completed. Certain communities are starting to report gains again while others continue to struggle. At the very least, there are some great foreclosure and distressed properties available at considerable bargains but the real estate forecast is far from clear.