March 2016 Maui Real Estate Report
More stability in the market; so I’ll address a more general topic of Vacation Properties. But first a mini update. We have seen a slight increase is sales that is seasonally expected. Prices are hanging in there with some changes in specific areas but also overall stable. Interest rates continue to be at all time lows. Rents continue to increase. I think a lot of people are missing opportunity! One thing that is definitely hurting our markets is the Canadian exchange rate. I talk to Canadians every week who are waiting to buy. When that happens, prices will go up.
I encourage Canadians to think about getting a mortgage through a U.S. Bank to mitigate the exchange rate difference. Yes, our interest rates are slightly higher than those in Canada but our mortgages have flexibility to exit when the exchange rates change. It is definitely something to consider!
How much of the Maui Real Estate Market is Vacation Properties?
What percentage of our market is vacation homes? The reality that isn’t a clear statistic as there are many condos that are vacation-rentable which are not used that way. But alas, I’ll try to give you some perspective. I am using numbers from March 2016 as I didn’t see that there was anything extremely out of the norm. This analysis also does not address that many property owners of both condos and residential properties are 2nd homes. They aren’t used as a vacation rental but they are only used by owners on vacation; this is especially common in high-end gated communities.
Of the 104 condo units sold last month, 68% were in vacation-rentable (VR) complexes. Since by definition, most residential properties do not allow vacation rentals, that means that 41% of the market is potentially vacation properties.
We have 2 areas on Maui where the majority of sales are vacation properties – West Maui and South Maui.
West Maui had 37 VR sales and just 6 non-VR sales of condos + 17 residential sales. 70% of the market in West Maui is vacation properties.
South Maui had 29 VR sales, 22 non-VR condo sales + 21 residential sales. 40% of South Maui sales are vacation properties.
Very few sales in other areas of Maui, are vacation sales.
Questions or comments? Need help with Buying or Selling or just understanding the market?
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