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Maui Vacation Rental Condos Surge in Jan-Feb

Two units at the beach front Wailea Elua, listed at $1.4M and $1.59M, have gone into contract since January 1.

Often times a buyer will rely on most recent sales to judge the market, and you’re absolutely right in factoring that data into your timing. But sometimes my most experienced clients will overlook an equally important bit of data, one with more immediacy and possibly even importance — pending sales.

A pending sale is a property that is in contract, also known as in escrow. The buyer has been qualified as a worthy and willing purchaser, and the seller has agreed upon his offer. A lot can happen between beginning of escrow and closing, so pending sales is not the tell-all — but it is telling.

Since the first of the year, 229 Maui condos have gone into escrow — more than half of them vacation rental condos.

The vacation rental condo market drew a massive breath of  air in January, which is a great indicator. Judging by what went into contract, we’re seeing increased activity from  experienced buyers who have timed the market to buy. Remember, these are not residential condos, but second homes/vacation rentals.

Take South Maui, for example. Kihei and Wailea vacation rental condos sparked strong demand, particularly at quality properties.

Ten Wailea vacation condos went  into escrow after January 1, including a 3/3 Hoolei  listed at $1.75M and on market 251 days, and two units at the Wailea Elua (listed at $1.4 and $1.59, 241 and 220 DOM, respectively).  Both are amazing properties–take a look at Hoolei  (MLS 337849).

Five condos at the neighboring Wailea Ekahi found contract ($498K-1.75M — four between 31 and 60 DOM, one at 251 days). And two units at one of Wailea’s gateway properties, the Grand Champion, struck deals — both 2-bedrooms, bargain listings at $399K.

The raid on Wailea properties has left inventory flat at some properties for the first time in recent memory, and that points to heated demand for pinnacle-level Maui beach front rentals  like the Elua. The Elua is down to two listings, a front-row beach front 2-bedroom at $3.9M (MLS341612), and a 1-bedroom at $1,189,000 (MLS 339777) . There is no shortage of units at the Ekahi, however, with 21 listed at $499K-$1.3M (MLS 340302)

Of the 10 Wailea escrows, seven were pure deals, and three were REO or short sales. Six of the seven highest priced sales were pure deals.

South Kihei
Movement at South Kihei’s blue-chip Kamaole Sands is always a market indicator
, and there were four deals there. Three of them were bottom-end units (one REO reportedly bid up from $250 list, the others in the low-300s), and one high end 1-bedroom in coveted building 10, listed at $477K. I mentioned the Building 10 listing as one of my picks here in a previous blog entry — now I like this unit in Building 2, at $449K (MLS337646).Remember that repeat renters at the Kamaole Sands are becoming more sophisticated and discerning in choosing location on the property, and interior units (Buildings 1,2,3,5,6,7 and 10) command more attention.

Neighboring upper South Kihei properties Maui Kamaole and Hale Kamaole also had escrows (listed at $549K and 525K, respectively), and a Maui Banyan 2-bedroom, listed at $399K was penned.

Three units went into escrow at my favorite value-oriented South Kihei vacation property, the Maui Vista ($221-250K). Only one was a distress sale. This property is located right across the street from Kamaole I Beach, and my clients who have purchased there have been very satisfied with their occupancy figures. You can see one of them in the vacation rental condo e-book at www.MauiInfo.com on page 50. I think unit 2-215, at $240K (MLS339005) listed at $240K, is ready to move and would be a great buy in the low-200s.

Escrows opened on two  REO units at the Kihei Akahi, a nice little property across the street from Kamaole II Beach, listed at $290K and $325K.

North Kihei
Are there buyers waiting for the right unit at the right price? You tell me — an ocean front  Kihei Beach 1-bedroom unit, priced at $595K, went into escrow just four days after listing.  A bank-owned at the Koa Resort, listed at $244,500, was under contract after 15 days.

Two Village by the Sea 1-bedrooms, listed at $219K and $188K, both natural sales, went to contract. Buyers are starting to mention those two words that have been so elusive in Maui vacation condo investments for so long — cash flow. Check out this distress sale, listed at $235K (MLS332836).

An all-original direct ocean front 1-bedroom at the Menehune Shores, feet from the water and listed at $459K, was snapped up. Just up the road on the ocean side, 1-bedroom units at the Luana Kai (listed at $399K) and Maui Sunset ($345K) found escrow.

A direct ocean front unit feet from the water at one of my favorite North Kihei vacation condo properties, the Menehune Shores, listed at $459K and was on market for 97 days before settling into escrow.

Across the street, two Kihei Resort units went into escrow, a 1-bedroom at $175K, and a 2-bedroom at $329K. This is a sleeper property (MLS 336898). Two ocean front Luana Kai, listed at $399 and 400K, found deals.

Kevin Spaise is a Hawaii Life property specialist, and the author/publisher of The Maui Condo Book, the reference guide most often used by Maui real estate professionals (www.TheMauiCondoBook.com). He welcomes your questions or comments via email (kevin@hawaiilife.com), or telephone, at (808) 344-0624. His wife, Sherry, owns and operates a vacation rental booking agency, MauiInfo.com, specializing in Wailea and South Kihei condo rentals.

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Tobi Fisher, R(S)

February 12, 2010

Great information, you really know your Kihei market. Keep up the wonderful flow of stats on the South Maui market. It sounds to be very active and that there are real bargins out there.
Tobi Fisher
HawaiiLife.com

Tobi Fisher, R(S)

February 12, 2010

Great information, you really know your Kihei market. Keep up the wonderful flow of stats on the South Maui market. It sounds to be very active and that there are real bargins out there.
Tobi Fisher
HawaiiLife.com

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