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2024 Maui Real Estate
A Slower Market, But Here’s Why
2024 MAUI REAL ESTATE - A SLOWER MARKET, BUT HERE'S WHY
The Maui real estate market has shown a significant slowdown in the third quarter of 2024, with rising interest rates, the Short-Term Vacation Rental (STVR) issue, and increased insurance costs contributing to the cooling effect. As a result, many sellers may be wondering why their property hasn’t attracted as much attention or received offers as expected.
MARKET OVERVIEW
Year-to-date (YTD) sales figures from the Realtor Association of Maui show a decrease in the number of sales across most categories. Residential sales remained relatively stable, up by just 1% (581 homes sold), while the condominium sector faced an 11% decline. The land market fared better, with a 15% increase in sales.
- Residential: 1% increase, 581 sales, median price of $1.3M
- Condominiums:11% decrease, 680 sales, median price of $912.5K
- Vacant Land:15% increase, 145 sales, median price of $902.5K
SLOWING SALES AND RISING PRICES
Despite fewer sales in several areas, prices continue to rise. The median sales price for homes increased by 9% to $1.3 million, and condominium prices jumped by 11%, now sitting at $912,500. This price rise amid falling transactions suggests that affordability and financing are becoming challenges for buyers. Furthermore, the market has been impacted by reduced showing activity, fewer offers, and an overall cooling demand.
THE IMPACT OF INTEREST RATES AND THE STVR ISSUE
Interest rates are a major factor in the Maui real estate market slowdown, as higher borrowing costs make it harder for buyers to secure affordable financing. Rising mortgage rates have led to fewer qualified buyers and decreased overall buyer activity.
Additionally, stricter Short-Term Vacation Rental (STVR) regulations are creating uncertainty in the investment property market. Popular vacation destinations like Maui, which attracted investors seeking rental income, now face tighter rules on where and how STVRs can operate. This uncertainty has made potential investors more cautious, further dampening demand for properties in key tourist areas.
Together, rising interest rates and STVR regulation changes are reducing buyer activity and increasing market hesitancy. For sellers, this means longer listing times and fewer offers, requiring strategic pricing to stay competitive.
understanding the seller's perspective
As a seller, it can be frustrating to experience fewer showings and no offers, but it’s crucial to understand the bigger picture. The market is adjusting to broader economic conditions that are affecting buyer behavior. Providing potential buyers with insights on local real estate trends and updated data on recent sales can help bridge this understanding.
Use the most recent pendings and solds graph to visualize how the market has shifted in 2024 and why activity is slower. Educating sellers with this data ensures they’re well-informed about the market dynamics and helps set realistic expectations for pricing and offers.
PREPARING FOR 2025: WHAT'S NEXT?
Looking ahead to 2025, sellers and buyers alike will need to consider rising property taxes, evolving STVR regulations, and the continued impact of insurance costs. Staying informed and adjusting to these challenges will be key for success in the Maui real estate market.
For now, patience is key as the market navigates this slower period, while maintaining optimism that the long-term value of Maui real estate will continue to grow.
