Newsletter X

August 1, 1999

For those Buyer's still interested in taking advantage of the low prices (which are still near the bottom of the market), for real estate on Maui, you have very little time left to buy!

If you have been reading my previous Newsletters these last few years, you are aware that I have been alerting you to the fact that the turn around in the real estate market here on Maui would be in 1997, starting with the oceanfront Whaler Condominium, which is the "last to go down in price during a recession and the first to rise in price following California's turn around."

Following the Whaler, with the sell off of all the developer units, is the Alii, The Alii  prices started moving up this last year, and now prices at The Masters in Kaanapali have been heading up also.

As I have reported before, "homes are the last to go down in price in a recession and the last to rise in price during an upturn in the mainland economy", and when the home inventory becomes slim, which it is now, we will turn over overnight from a "BUYER'S MARKET TO A SELLER'S MARKET".

Someone mentioned to me via E Mail, they thought there was plenty of time to buy a house, since they had heard Hawaii is still lingering in a recession.  It's true that Hawaii moved into a recession in 1991, but sales of property on Maui are not dependent upon local consumption, and the largest percentage of buyers have traditionally been from California or the West Coast. As long as the nation's economy stays strong, the demand for houses in Maui will continue.

In every one of my past Newsletters I always go back to the old refrain... "SUPPLY AND DEMAND".

The Market

Either Mako or myself, (and many times the both of us) sit open house 7 days a week.  We talk to many hundreds of people interested in property every year, and we have a good idea as to what the majority of clients want to purchase here on the West Side of Maui.  By far the largest percentage of people planning to retire here in a few years prefer to spend no more than $450,000 to $500,00 for a house. 

HOMES: 

In the Kaanapali Area on Maui:

15 homes listed in the $1,250,000 to $3,500,000 range

5 homes listed in the $700,000 range and

3 homes listed in the $500,000 range

It doesn't take much imagination to figure out where prices will be heading.  99% of the homes will be purchased by buyers from the mainland U.S. and approximately 80% of those will be purchased by people from the West Coast.  Once the above crop of homes are sold, the next threshold will be $100,000 higher, since owners that have previously removed their homes from the market will begin to list them again.

CONDOMINIUMS: 

The only property lagging behind the market has been the Kapalua Resort area, where inventory for condominiums has remained high and prices have remained low.  This is primarily because of the sell off of properties by Japanese owners.  Homes and lot prices have started gradually moving up, as well as condominiums in the Golf Villas and Ridge Villas.  

Kapalua has several new projects coming on line, which is very exciting and will give a boost to the resort. One of the projects will be the COCONUT GROVE CONDOMINIUMS.

The 32 Coconut Grove 3 Bedroom, luxury, two story condominiums will more than likely be purchased by present and past owners in the Kapalua Resort. I wouldn't be surprised to see them all reserved before they even hit the market! Coconut Grove is  located on the world famous Kapalua Beach, one of the finest beaches in the world, between The Bay Club and the Kapalua Bay Hotel. 

The six oceanfront buildings will sell from $1,750,000 to $2,200,000 and the three buildings on the back row will sell in the $1,300,000 to $1,600,000 price range.

OCEANFRONT HOMES:

This is easy, since there are now only 4 oceanfront homes listed on West Maui and they range from $1,700,000 to $3,900,000.

Since there has traditionally been so few homes for sale on the ocean from Lahaina to Kapalua, a sure sign of a turn around in our real estate market is the fast sell-off of oceanfront homes which began about two years ago.  Back then there were a dozen or so homes and lots for sale, and now we are virtually down to nothing.

If you have any questions, please do not hesitate to call us on our 800 number or E-mail us and we will promptly return your message.

Sincerely

Cliff C. McQueen (RA)

Copyright© 1999 Cliff McQueen