According to tourism officials, March was a significant improvement for the Hawaiian islands over a year ago, with Maui taking the most dramatic headway.  Visitor arrivals grew up to 181,182 (a remarkable 14.2 percent improvement over March 2009) and expenditures increased to $257.7 million (an incredible 25.2 percent growth).  Credit can be partly assigned to more new  flights to Maui being added, in particular from Canada and parts of California.  This will have a lasting effect from this point forward (unless such flights are later discarded by carriers) and can be the beginning of a trend, where most of the tourism growth will be allocated to the Valley Isle.  However, to keep in context, one must remember that last year was the height of the economic crisis and tourism was anemic, at best.  Does this mark the beginning of long-term economic recovery?  Quite possibly.  The Maui real estate statistics for the month of April will be out in few days, with the possible sign that we have scraped the bottom of the market and are on the path for long-term growth and endurance.  Taking into account for declining unemployment rates, improved consumer confidence (based on job creation and national trends), tourism increases, and all the indicators are there for a stabilization (and possible growth) of the Maui economy.  Stay tuned, we could be in for a collective sight of relief.

As Maui prepares for future growth on the island, there are two camps of thought: no growth (keep our island for ourselves!) vs. pro-growth (embrace big business and all it brings).  However, we must face reality:  growth will happen and we would be better served by proactively planning for such, instead of implementing reactive measures that may be too little too late.  The Director of the Maui County Planning Department, Jeff Hunt, recently addressed the Realtor’s Association of Maui in which he discussed some key issues facing the county.  According to Mr. Hunt, the County’s plans are to anticipate population increases with ‘managed growth’, which will ensure that fundamental issues are addressed accordingly.  For example, with increases in population comes the need for the infrastructure (i.e schools, health care, transportation) to accommodate such additions, and Mr. Hunt’s plan takes into account the projected growth to provide for such (projections are for increases in older population, thereby the need for health care facilities is being anticipated and planned for).  Perhaps the plan can implement collaboration with other entities (such as the Department of Education) in educating/training the workforce that such growth will require, putting emphasis on health care, renewable energy, and technology-based services.   In addition, the housing needs for the coming decades is being met by thorough planning to ensure that values remain stable and there is sufficient housing for Maui citizens;  failure to prepare could result in a volatile real estate market (not enough housing would result in high-sky prices with the increased demand, yet uncontrolled growth would lead to sinking values as there would be too much inventory).  Furthermore, MCPD’s plan aims to preserve the Maui lifestyle and Hawaiian culture while protecting the environment.  The Valley Isle is known worldwide for its unique lifestyle and deep cultural roots, failure to preserve those would be a great disservice to future generations.    All in all, Mr. Hunt and his staff seem to have listened to constituents and came up with carefully-drafted strategy to address the collective voice of Maui.  I, for one, look forward to a lifetime of memories in Maui.

For additional information, visit the the Maui County Planning Department and download the Draft Maui Island Plan.

UPDATE:  Jeff Hunt resigned as Maui County Planning Department Director on April 28, 2010.  Deputy Directory Kathleen Ross Aiko will fill the Department’s top position.

On April 23rd and 24th, Jack Johnson, Ziggly Marley and other world-class artists will converge at the Waikiki Shell to celebrate Earth Day weekend and raise environmental awareness.  After a year hiatus, Hawaii’s most noted singer-songwriter is proudly hosting the 6th Kokua Fest, all proceeds of which benefit the Kokua Hawaii Foundation (a non-profit established by Jack and his wife, Kim, to support Hawaii-based environmental programs).  As anyone who has attended a previous Kokua Festival can attest, it is far more than a musical show; it is a heightened experience that will resonate in your memory for a lifetime.  From the phenomenal artists performing, to the delicious environmentally-grown food, to (most importantly) sharing a memorable time with great people, this is an event not to be missed.  This year’s line-up will include Maui-based singer/songwriter Anuhea and ukelele extraordinaire Jake Shimabukuro.   Ziggy is sure to put on a terrific show, coming off the release of his best albums, Family Time (for which Jack collaborated on the popular ‘Cry Cry Cry’).   Whether you enjoy the presence of other like-minded, environmentally-conscious citizens, or listening to the musical achievements of true artists, or just want to have a great time under the sun with a bunch of great people, Kokua Fest has raised the bar in how entertainers engage their audiences (specially with such a worthwhile message).   See you there (reduce, reuse, recycle).

Most home buyers are well aware of the looming deadline for the $8,000 first-time home buyer tax credit, and the $6,500 repeat home buyer tax credit.   In order to qualify for these credits, the Buyer needs to be in a binding contract by April 30 and have the purchase completed (closed/settled) by June 30 (there are certain exemptions to these deadlines, specific to military personnel, foreign service, and certain governmental agencies).  In addition, homes with a final sales price over $800,000 do not qualify for these incentives, and there are a number of income requirements that must also be satisfied to qualify.   Keep in mind that if you made a qualifying home purchase in 2010, you can still submit it on an amended 2009 income tax return (or of course, you can wait to file it with your 2010 tax return).  What impact will the end of this incentive have on the Maui real estate market?  Well, possibly, with so many buyers flooding the market to take advantage of these tax credit incentives, there could be a drain on the pool of qualified buyers resulting in a reduced amount of potential buyers actively in the market after the deadline has expired.  With fewer buyers, sellers could be forced to further entice the remaining Maui home buyers by lowering prices or offering incentives (i.e. closing costs, home warranties, negotiating repairs or final sales price).  Could that possibly mean that you would get more value than a $8,000 or $6,500 tax credit?  Absolutely.  For potential home buyers, it is of critical importance to make an informed decision based on your specific situation, weighing in aspects such as your price range (lower price ranges will see a bigger effect on their overall purchasing power), criteria in a home (starter homes are most likely to be affected by the tax incentive), and overall motivation (do you NEED to purchase now).  Feel free to search for Maui real estate and contact us should you need further information.

It is easy to become emotional and biased when giving an analysis, but numbers reveal the raw reality that lurks behind.  The following are the statistics for Maui County as released by the Realtors Association of Maui (RAM) for the month of March, 2010.

*  70 residential sales, which have experienced an increase for the past two months.  Median price fell slightly to $460,000.  Days on market (DOM) is at 133 days (from listing to closing, so take into account the approximate 30 to 60 days of escrow).

*  122 condominium sales, which is a high for the past 46 months.  Median price saw an upsurge to $512,250.  Days on market (DOM) is at 235 days (again, this is measured from listing date to closing).  When looking at the number of condos sold, please take into account that this includes 41 sales at the Honua Kai Project which adversely affects the median/average condo price (these are high-end units ranging in price from $570K to over $5M).

*  12 lots of vacant land sold, a 41% increase over last month’s sales.  Median price saw a substantial increase, from $350,000 in February to $600,000 in March.  Days on market (DOM) is 230 days.  Please note that land sales are so modest that such statistics can be affected considerably by one or two large/small transactions.

Overall, these are all signs that we have scraped the bottom and the market is stabilizing.   REO’s and shortsales represent approximately 8% of the total inventory, yet account for roughly 25% of completed real estate transactions in Maui.  These distressed properties need to be absorbed by the market before further stabilization and such incorporation will mark the start of price increases.   What does that mean for potential sellers?  Unless you are motivated to sell and are willing/able to price accordingly, perhaps the time to list will be in the upcoming months.  And for buyers?  The stars have aligned, interest rates are historically low (yet increases are expected in the near future), the tax credit is coming to an end, and an inventory fueled by motivated sellers results in the perfect time to buy Maui real estate.