The number of sales for homes and condos on Maui is down significantly over the last few months which is due, in part, to a dramatic drop in the number of new listings coming on the market for sale.
While prices may have plateaued, they have not really gone down the past several months because of the limited number of homes on the market. While housing inventory is slowing going up on Maui, experts agree there is still a major housing shortage on our island. This includes homes available to purchase and homes available to rent.
We have interviewed many of our trusted clients recently seeing who might be interested in selling. Here are the top 3 reasons our clients are sharing with us why they are not motivated to sell in today’s market.
The Golden handcuff effect
The homeowner has locked in a record low interest rate. If they sell in order to purchase another property, they will end up paying a significantly higher interest rate impacting their monthly carrying costs. This is the “golden handcuffs” so to speak.
The homeowner will pay significant capital gains taxes in the event they cannot find another suitable 1031 property to exchange into. Many desirable resort markets such as Maui are still seeing record low inventory and high list prices.
Rentals are good
For investors who own vacation rentable condos on Maui, they are still able to capitalize on the strong vacation rental condominium market and are cash flow positive. It would take a big change in the vacation market to motivate these types of owners to sell.
Low inventory by the numbers
Comparing the Maui Inventory 6 months ago, there were 270 single family homes for sale and 220 condominiums available for purchase. As of February 2023, there are 277 single family homes for sale and 227 condominiums listed for sale.
Until we see a major increase of quality properties that become available to purchase on Maui, it is challenging to see prices significantly dropping. There’s just very little for sale across the island.
That being said, sellers who overprice their home in today’s market are going to be let down big time. The buyers we are currently working with are very discerning and refuse to pay up for properties. Homes are sitting on the market longer.
If you are considering listing your home for sale in this market, having the right team to advise you is critical. Our team will always give you our honest opinion as well as our in depth market analysis…no cost or obligation of course.
If you are a Buyer and are ready to purchase this year, please give us a call today. Our entire team is here to support you, to advocate for you, and to negotiate for you any way that we can.
In times of volatility, timing the market may be tempting. That being said, it’s nearly impossible to buy at the bottom or sell at the top.
Beyond being a trusted advisor in the real estate market, your REALTOR should be a professional who recognizes their role in supporting your wealth building and wealth preservation. Helping to magnify wealth is one of the core values of The Sayles Team; a set of guiding principles for how we serve our clients at the highest level. As experts in the field, we are constantly learning and providing guidance about making the wisest choices for the future. If someone you care about needs guidance or recommendations, please share our contact information and we would be honored to help them! If you would like to receive our in-depth market update or would like an evaluation of your property’s value we would love to hear from you.
Dano Sayles R(B)