Maui Real Estate and Housing Report | Quick Facts for April 2020:
– 18.8% Change in Number of Closed Sales All Properties
+ 20.4% Change in Number of Median Sales Price All Properties
– 9.2% Change in Number of Homes for Sale All Properties
Single Family Sales Volume: $84,620,434
Condominium Sales Volume: $85,496,854
Land Sales Volume: $6,020,500
From RAM (Realtors Association of Maui):
While the stock market recovered significantly in March, the effects of COVID-19 to the economy continue to build. In just the last four weeks, more than 20 million people filed initial unemployment claims according to the United States Department of Labor, fueled by stay at home orders and a slowdown of economic activity across the country. Added to the unemployment claims from March, more than 30 million people have become unemployed since COVID-19 has become widespread in the U.S. In the face of these challenging times, real estate activity in April slowed significantly.
Maui Real Estate: New Listings decreased 41.9 percent for Single Family homes and 23.9 percent for Condominium homes.
Pending Sales decreased 57.8 percent for Single Family homes and 71.5 percent for Condominium homes.
Inventory decreased 18.9 percent for Single Family homes and 1.3 percent for Condominium homes.
Median Sales Price decreased 7.9 percent to $754,523 for Single Family homes but increased 35.6 percent to $602,494 for Condominium homes. Days on Market increased 33.6 percent for Single Family homes and 48.1 percent for Condominium homes.
Months Supply of Inventory decreased 12.5 percent for Single Family homes but increased 9.3 percent for Condominium homes.
While the effect of COVID-19 continues to vary widely across the country, it is expected that social distancing, higher unemployment, and lower overall economic activity is likely to continue to constrain real estate activity in the near term. At the same time, the industry is adapting to the current environment by conducting business using technologies such as virtual showings and e-signing to help buyers and sellers with their housing needs in the face of these challenges.
Looking back our 2020 year started out with healthy indications… but not so fast to past judgment as you get to the end of this blog I will humbly offer you my opinion.
Here is what RAM (Realtors Association of Maui) said in February
Maui Real Estate and Housing Report when the January 2020 data came out.
We start off the year with continued low interest rates, low unemployment, and rising rents nationally. These factors should encourage healthy buyer demand and sets us up for a strong start to the 2020 housing market and a lot of optimism for the coming spring market.
So we were on our way! But then…the world shut down! A global pandemic. Alot of us shut in. And for a few weeks, many of us paralyzed on wondering what was happening. I actually had a few escrows during this time so even during this disorienting period, there were real estate sales (with new COVID-19 cautionary measures in place). I feel it is important for me to give you even more precise data for this period. I want to show you what happened with Maui real estate data when Maui implemented “stay-at-home’ and then “safer-at-home” orders (started March 25, 2020 and as of this writing runs to May 31, 2020 ); and when the State of Hawaii implemented the 14-day Travel Quarantine (all visitors from the mainland and abroad had a mandatory 14-day quarantine once they arrived on the islands). It is not certain yet when the 14-day quarantine will be lifted. Being more surgically precise and extracting more defined data will be more helpful to figure out what to expect.
Maui Real Estate and Housing ReportApril 2020, as expected, showed a formidable shift from the same period in 2019. The graph below shows new escrows (properties under contract) in April 2020 to be 106 escrows while last April 2019 it was 271. Having said that, the Maui real estate market did not go off a cliff, rather it is weathering it. As of this writing, I can say across the board as I talk to colleagues; the phone calls, interest, and showings are trending up. This is indicative of the nationwide trend. Showing Time which tracks showings saw an increase in rolling week trends in the top 10 US markets.
Below is the Maui Real Estate April 2020 Housing Data compared to 2019 and 2018.
For the first time in a while we see pending single-family homes outpacing the condominium market. Again something to keep an eye on as we move forward. It was noted that Makena (which is one of Maui’s high-end market -some would argue the highest end) was noticeably more occupied. Owners finding that their Maui home is the preferred place to stay during these times. I think this sentiment will be important to note.
These pending sales will certainly impact closed sales figures in May and June.
As I mentioned before, Maui real estate market stayed surprisingly resilient amidst all of this. The closing sales, of course are lagging figures but 84 sales in April compared to 78 closed sales are good. Although there were some who canceled their contracts, many of them had faith to move forward.
Just like the rest of the country, our issue here on Maui before the pandemic and still now will be lack of housing inventory.
We mainly have 2 types of Condominiums here on Maui. We have condos that allow long term rentals only and condos that allow short and long term rentals. I feel this is an important distinction to note in the near term, as much will be dependent on the rate of tourism returning back to our island. This different category of use also has different property tax implications. Call me to discuss should you have any interest.
Why did median price of Maui condominiums increase? 17% (15 out of 87) of the sales in condominiums came from the brand new Honua Kai Luana Gardens (median sold price in April 2020 was $2,255,000). The majority of Honua Kai Luana Garden condos went into escrow in 2018, but closed in April 2020 since it was now built and ready to occupy. Our aggregate numbers are low due to that fact we are an island with limited space. Therefore very high or very low sales affect average and median figures considerably but may not be indicative of the full picture. Hence it is important to have an experienced and trusted realtor in order to make informed decisions. Real Estate websites that work on algorithms can be off too high or too low. It should definitely not be used as the only source for your decision making. Real estate and in particular Maui real estate is very local. Micro-data is very important here on Maui.
The listings for single-family homes on Maui have decreased by -18.9% year over year. Some sellers decided to take their homes off the market due to the uncertainty from a health and economic standpoint. This was on top of an already existing trend towards a decrease in inventory. Typically we do see an increase of listings during our winter and early spring months as our high visitor season is in swing.
However, you will note that the listings of condos only dropped -1.3% year over year. This is something to keep an eye on moving forward. The condos that are allowed to have short term rentals are owned mostly by “non-owner occupants”. So many are in a vacation rental category. With the 14-day quarantine in place, our visitor arrivals have plummetted. On April 30, 2020 we had an economic negligible figure of 451 arrivals compared to 31,244 arrivals the same date in 2019.! That is a dramatic -98.6% change! How will this affect owners of vacation rentals? Again, it is something to keep an eye on.
See data below from Hawaii.gov Department of Business, Economic Development & Tourism (does not include flights from Canada).
On May 4, 2020 UHERO (University of Hawaii Economic Research Organization) wrote COVID-19: Developing Economic Recovery Scenarios for Hawaii. UHERO report predicts that in “non-tourism” sectors of the economy there will be a more rapid recovery than in the tourism sector but at a measured pace. “In May and June, we assume the return of 35-45% of the business activity lost during the most extensive period of local economy shut-down in April. By December, 75% of economic activity lost due to the stay-at-home order will have been reversed.
The less-than-complete recovery reflects macroeconomic weakness, ongoing costs of measures to preserve social distancing, and spillover effects from persistently low levels of tourism. ”
For the visitors’ industry, UHERO predicts, “The timing and degree of recovery in tourism is highly uncertain, but it is likely to be very attenuated. We assume that progress in rolling out screening, testing, and tracing of visitors will allow for re-opening of the visitor industry by the last week of July, but that the pace of visitor return will be very slow. Specifically, we assume third-quarter arrivals will recover to only 28% of their fourth-quarter 2019 level, and that capacity use will linger at low levels through the end of the year…”
Many major assumptions are made in this report because honestly speaking that is all we have in dealing with this novel virus. They offer several scenarios some more pessimistic and some more optimistic. Only hindsight is 20/20.
READ THE FULL UHERO REPORT HERE
I have a wealth of data on Maui Real Estate and Housing Report To read the April 2020 YTD data and archives of past data you can always find it here.
Closing note: Maui has proven itself during these times to be filled with aloha and resilience. The pain is real for those with loss of health and life and for those whose jobs have been lost. So there is no sugar coating that or making it sound rosier than it is. Maui Real Estate Market is still moving. There are people from all over the world who have the desire to travel and vacation here AND dream of owning their own piece of paradise, not to mention the need for housing for people who live and work on Maui. So I have no crystal ball nor does the best of the best economists. But HOME proves to be ever more desirable during these times; a home to shelter, to live, to share, to re-calibrate, and now even to work becomes ever more important. Maui is one of the most remote places on earth. It has one of the most diverse micro-climates. The list goes on and on. To those who want to consider buying their first home, or upsize, downsize, or to have their vacation home, whether it is a home or a condo on Maui- this may be the time. I live across from the beach and I have never appreciated that more… I have never appreciated Maui more.
An incredible place to call home or your vacation home is this resort-like luxury property called Halama Dolphin Villa. I have the privilege of representing this one of a kind Maui property. It is luxury oceanfront. The main home is exquisite and also has a guest cottage. It has a movie theatre, a swim-up bar, a huge pool, a fitness gym, ocean side putting green, Photo-voltaic solar panels for energy and so much more. Go here to view the video and take the 3D tour. www.1676Halama.com Call me for details and your private showing. It is like owning your own resort. It is a gem.
Call me to discuss your interest in the Maui housing market. I am here to offer years of experience, a good listening ear, commitment to your goals, and much aloha. Whether you are a seller or a buyer, I appreciate the opportunity to be of service.
Stay safe and wishing you much aloha… until we meet again.. a hui hou.
Jeannie Kong-Evarts RS-68054
Thank you for taking the time to read the Maui Real Estate and Housing Report.
Sources: Realtors Association of Maui, Hawaii.gov, UHERO. Information is deemed reliable but not guaranteed.