This month there isn’t too much new to report so I started asking some questions! If you have questions, I’d be glad to hear them and try to address them with some real data!
My question came from a client who is trying to buy something here. Do we have seasons in the Maui real estate market?
On the mainland, the peak buying time is March-June so that families can move during the summer. It usually really slows down around the Christmas holiday. Here, the Maui market is a little different. For years, other agents have told me that our peak buying season is Jan-March. That makes sense because that is our peak tourist season.
But I started wondering if that was true for most markets in Maui? Are houses impacted the same as condos? What about areas where tourists tend to not look or buy? I usually have my trend analysis show 2 years of data but I changed it to show all the data that I keep in my database so that goes back to 2006. The following chart shows the units sold over time.
So the answers are:
- Most valleys (low points) happen in August-September. This very evident in the condos many of which are vacation rental condos.
- Most peaks (high points) happen in April, May. If you buy in February, have a 45 day close you will close in April. That makes sense.
- However in the residential market (red lines), that period is almost the opposite with lowest sales number being in Feb-March.
- When I looked at data from specific non-tourist areas (Central, Upcountry) it was clear that there were 2 low points in Feb-Apr (like the mainland people buy to move in when school is out) and another in Sept-October. I like to think that people buy homes hoping for a new home for the holidays! If this is you, you should be looking now!
Next question was: When are the prices at there lowest point?
That is a bit harder because you have to look at basic trends and then the seasonal changes. Below is a graph of the median sold price over the seasons.
From this – I see that lowest prices tend to be in August/September (i.e. the people who purchased in July/August). The condo market shows this clearer but in homes the dip is far less obvious. Does that mean that buying in the low season you will get the lowest price? NO! Because the market keeps changing.
We are still seeing trends going up, but at a slower pace than the last few months. We’ve seen quite a few more foreclosure auctions schedule in the paper so we might be seeing more foreclosures coming on the market that may keep prices down a bit.
I ran this chart last month that shows % of distressed (bank-owned or short sales) over time. You would think that we are nearing the end but I suspect this one is going to have a LONG tail!
Ok, too much data! Longer than a minute!
Questions or comments? Please ask below.