So what is the main reason a property sells fast; or otherwise, why is a listed property most desirable from a buyers perspective? It’s been common thought that location always reigned supreme, no matter the market. You have the best spot on the beach, someone will always want it. Other answers might include new remodels and luxury retrofitting. These often accelerate the seller’s timeline to closing as well. However, when analyzing the new numbers from our most recent Maui Real Estate Report, there was one underlying factor that stood out.
Perhaps the new real estate mantra should be ‘price, price, price’! Properties that present well and are priced appropriately continue to sell quickly, often above the asking number – accounting for 20% of total sales. However, nearly one in every three properties sold last month experienced at least one price reduction since being listed. Consequently, properties that had a price reduction were on market twice as long averaging 196 days on market, as opposed to 87 days on market for properties that had no reduction.
July 2023 Maui Real Estate Report
Discrepancies between seller’s pricing and buyer’s perceived value is the most likely reason Maui’s real estate market remains stuck in neutral. Summer time can be slower here on the island, but sales activity has noticeably tapered off in recent weeks. Nowadays, we hear interested parties scoff at the current prices and reconsider market positioning way more than we should. There’s a delicate balance happening. Inventory remains at all time lows. Most homeowners are currently locked into historically low rates.
July 2023 Maui Single Family Home Transactions
With mortgage interest rates creeping back up to 7% and a perpetual lack of properties for sale, both buyers and sellers are limited in options. As we approach the second half of the year, those who have been watching our market reports carefully will notice the variance in year over year change begin to decrease as the market is now approaching one year of this ongoing stalemate.
July 2023 Maui Condominium Transactions
Recently the standout in the overall market, the Maui condo market has noticeably cooled since its peak in March 2023. Total sales have dropped by 40%, alongside median prices which slipped from record highs of $994k in June to $850k in July. However, year-over-year, condo prices are still up by 8%, led predominantly by Wailea, Makena, Napili, and Kihei. With daily visitor rates showing a downward trend, short-term vacation rental condos are beginning to face increasing headwinds.
July 2023 Maui Luxury Real Estate Update
Speaking of investment opportunities, the luxury condo sector that allows short term rentals continues to pace the luxury market as a whole. The South Maui neighborhoods of Wailea and Makena, along with West Maui communities Ka’anapli and Kapalua, continue to be the hottest spots for both total units sold and volume. While there has been a bit of a slowdown for the sector overall, the underlying numbers match to what we saw in April of this year.
Further analyzing the numbers, take note of the correlation between list price received and median days on market. As we mentioned above, properties that were properly priced from the start saw the quickest sales. Their transactions completed much faster than those with price reductions. Of course, there are some sellers that listed with only a “godfather offer” in mind. Which is okay.
However, for those truly serious about selling, the initial pricing upon listing has never been more important. Long gone are the dog days of the pandemic, when properties sold above asking in nearly every market. So if you are interested in finding the true value of your Maui condo, contact our team ASAP. With all-time low inventory and near record high prices, it’s likely your property is as valuable as ever!
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)