Aloha, everyone. I just read this brief article (and its misleading title “Maui home sales are up”) in the Pacific Business News about the recent real estate sales figures for Maui. The overall picture is that while volume is up, median prices are way down. Let’s quickly look at the numbers. Sales of single family homes (SFH) this past December dropped 22% compared to December of 2009. However, total sales of 2010 beat 2009 figures by a sizable 17% – not bad. For condos? The December 2010 to 2009 comparison shows an increase of 14% while the yearly increase is a whopping 39% jump.
Now before people start jumping for joy, let’s dig further. Honestly, I’m not a big fan of comparing the numbers between the same month of different years. It makes for nice copy and may capture some important seasonal factors of some markets, but let’s just look at the yearly numbers for median sales price, shall we? The median price of a SFH in Maui dropped over $38,000 per unit or 8% from 2009 to 2010. Condos dropped 16% – over $72,000 per unit!
So sales volume is up while prices are way down (again, the misleading title but I’ll let that go). Why? Same story. Lots of properties are discounted or distressed because of all the foreclosures and short sales — really, this is not news anymore. Now while this does present good opportunities for Hawaii’s real estate investors, it’s not so rosy for the locals.
It was plainly obvious to me when I was in Maui for a week this past December. My parents were out on their first visit to the Aloha State. We flew into Kahului on a late Saturday morning after a few days on Oahu and promptly headed to Lahaina for lunch. Now this was a beautiful, sunny Saturday afternoon yet Lahaina was a GHOST TOWN. I was stunned. Where were all the people wandering around, visiting the local galleries, strolling along the seawall enjoying the views of Lanai? Later that evening we headed to our rental in Kihei where we would base ourselves for the next few days. Talking to the locals, everybody was down about the local housing market — short sales were everywhere. So be careful of the news you hear about market rebounds because we have a long way to go yet and the neighbor islands are going to feel it harder than Oahu (if they aren’t already) until we all get this thing figured out.
So I want to give some love here to our beautiful neighbor island to the east (and it really is stunning, if you haven’t visited; my tip: drive to Hana then keep going around Kipahulu – just don’t hit any cows). Hawaii is more than just Oahu and we need to be concerned about all our islands here. Maui residents, what’s your take on your market? Is it showing signs of life or what’s it going to take? Did I just have an off day in Lahaina or is that the state of affairs right now as we kick off 2011?
Share your comments below….gripe, moan, cheer, complain, rejoice……
Michael Borger, Big Rock Investments says
By the way, I need to start reading the Pacific Business News some more! It’s a good publication….