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March, 2006 - Newsletter for the Maui Market
Don't forget; if you currently own a property and would like to be notified when there is a new listing in your particular complex, we can set you up to automatically receive the new listings via email. The service is also available for those interested in purchasing a condominium, home, land or other property. If you provide me with your first and last name, your email address, and the condo complex you wish to be notified of, we can program the system to notify you as new listings become available.
At the beginning of July, 2005 there were 165 condominiums for sale in the West Maui area and the total value was $159,356,997.00; August, 2005 there were 166 condominiums for sale with total value of $154,446,497.00; September, 2005 there were 176 condominiums for sale total with value of $163,215,390.00; October, 2005 there were 177 condominiums for sale with total value of $168,464,220.00; November, 2005 there were 199 condominiums for sale with the total value of $188,377,265.00; December, 2005 there were 231 condominiums for sale with the total value of $222,669,115.00; January, 2006 there were 226 condominiums for sale with the total value of $226,520,200.00;February, 2006 there were 280 condominiums for sale with the total value of $281,793,835.00; and at the beginning of March, 2006 there are 297 condominiums for sale in the West Maui area and the total value is $286,082,559.00. The condominium for sale inventory since July, 2005 has been as low as 165 and is back up to 297 for March 1, 2006. For sale inventory continues to increase.
The total condominium sales for West Maui during the month of August, 2005 was 40 and the total value was $21,749,104.00; for the month of September, 2005 total condominium sales was 51 and the total value was $36,318,521.00; for the month of October, 2005 total condominium sales was 32 and the total value was $18,973,291.00; for the month of November, 2005 total condominium sales was 38 and the total value was $28,453,380.60 ; for the month of December, 2005 total condominium sales was 43 and the total value was $25,171,967; for the month of January, 2006 total condominium sales was 36 and the total value was $23,362,643.00;and for the month of February, 2006 total condominium sales was 44 and the total value was $30,594,578.00. The total condominium sales for August, 2005 was 40; September, 2005 was 51; October, 2005 was 32; November, 2005 was 38; December, 2005 was 43; January, 2006 was 36; and February, 2006 was 44.
For previous condo sale details go to our web site, www.JamesBFoster.com and click on Condo Sales. For the time period of 1/1/2006 to 1/31/2006 with 1/1/2005 to 1/31/2005 the average price for a home on Maui is $1,142,396.00 at 1/31/06which is up 24% from a year ago for the same time period ending January 31, 2005 and for the same time period the average price for a fee simple condo on Maui is $617,347.00 which is up 11% from a year ago for the same time period according to the RAM statistics.
We have gone in to the MLS data base and pulled information for 2000 through 2005. In 2000 - 654 condominiums sold in the W. Maui area for a total value of $209,064,010; in 2001 - 605 condominiums sold for a total value of $271,681,337; in 2002 - 730 condominiums sold for a total value of $240,178,915; in 2003 - 737 condominiums sold for a total value of $319,748,466; In 2004 - 698 condominiums sold for a total value of $374,342,467; and in 2005 - 672 condominiums for a total value of $402,340,315.00. To date for 2006 (January & February) 85 condominiums have sold for a total value of $57,769,221.00.
Mortgage Rates as of 2/27/06 From Central Pacific Home Loans – House/Condo: 5.75% 30yr fixed 2.0 pts ( 6.00 APR) 6.00% 30yr fixed 1.0 pt ( 6.13 APR) No Docs: 6.125% 30yr fixed 1.0 pt ( 6.25 APR) House/Condo: 5.625% 15yr fixed 1.0 pt ( 5.75 APR) Condotel: 6.125% 30yr fixed 1.0 pt ( 6.25 APR) Interest Only: 6.375% 30yr fixed 1.0 pt ( 6.50 APR)
$1M 20% down: 6.375%, 30yr fixed 1.0 pt ( 6.50 APR) No Income, 80/20 & Stated Land loans (Pts incl. origination)
If you would like to view the most current sales statistics for Maui or West Maui Condominiums, you can go to my web site www.JamesBFoster.com and click on Condo Sales in the upper left corner of the home page. If there are any specific condominium complexes that you wish to be notified by email when a condominium becomes available for sale, send me an email as I check the MLS data about four times daily and if a new listing comes on the market I immediately notify any clients who have requested that information. Many owners also like to track what the units are selling for in the building where they own which they can do from my site.
There are three real estate development projects we have recently previewed:
- Aina-Nalu was previously the Maui Islander and was purchased and completely remodeled by Ironwood Associates, with 3D Builders as the contractor. It is in the down town area of Old Lahaina on Wainee St. and one block over from Front Street. The complex is owner occupants, long term rentals and vacation rental. The prices for the units range from $305,000 for studios, $495,000 for 1 bedrooms and $600,000 and up for 2 bedrooms. Call us for more details or we can email you the information.
- Kaanapali Coffee Farms is a 336 acre development upslope from Kaanapali resort with4.2 Acre to 6.835 Acre Farm Lots priced form $1,580,000 to $1,770,000. It is low-density, upscale housing with diversified agriculture structured as an agricultural subdivision under Hawaiian law. A portion of each lot is leased for the production of coffee. As an example, on the lot with 4.2 Acres, the residential site is 46,733 square feet for the construction of the home and the balance is leased for coffee production. The development sits up Mauka (Mountain Side) of the Kaanapali Resort. Call us for more details or we can email you the information.
- Lanikeha, an exclusive gated community with amenities such as a club house, a grill room, an exercise room, a beautiful infinity-edged pool and hydro spa. The original owners are given the opportunity to participate in a three component program a) Spa Component at the Hyatt Regency Maui, b) Golf Component at the Kaanapali Golf Courses, and c) Cultural Component at the Maui Arts & Cultural Center. Lanikeha is a part of the Kaanapali Golf Estates Community Association and will also have its own exclusive association of lot owners. In phase II there are 65 lots from 18,045 square feet up to 76,765 square feet with prices in the $698,000 to $1,750,000. Call us for more details or we can email you the information.
Barnes & Noble is coming – Expected to be the largest book store on Maui when the new Lahaina Gateway opens in the spring of 2007. The 3.1 acre Lahaina Gateway lifestyle center will feature shops, services and three full-service restaurants, plus snack shops. It will be located on 11 acres across from the Cannery Mall and alongside Keawe Street extension that will link Honoapiilani Highway with a portion of the future Lahaina Bypass.
Maui’s Sand is Running Out – With 318,000 tons dug and 70% being shipped to Honolulu, it will be gone within five to seven years according to a report being prepared for Maui County. The sand is the main source of sand used in Oahu concrete. Mayor Arakawa has asked the County Council to review the study, “and that the option of declaring a moratorium on export of sand mined in Maui County be explored in order to extend the life of Maui’s remaining sand resources for Maui’s people.”
Infrastructure for Maui Development – On the mainland there are impact mitigation fees for new developments but Maui does not operate that way. The viewpoint of Jo Anne Johnson, the West Maui representative on the Maui County Council is that infrastructure should be addressed ahead of projects and she is dead on point. If Maui County does not correct the situation it will have a negative impact Maui’s most important industry, “Tourism”. As Jo Anne Johnson has said, “It is a community that has experienced a massive increase in the number of visitors and residents, yet has had few changes in core infrastructure. Honoapiilani Highway is the same two lanes leading into Lahaina as it has been for decades; the bypass is still not completed and will not be totally finished for at least 15 to 20 years; the majority of our already overcrowded schools are on one road – Lahainaluna – and traffic backs up on a regular basis; the sewer system is in need of $20 million worth of upgrades to meet projected commitments; our reclaimed water is not being utilized due to a lack of distribution lines; realistically priced housing is at a crisis level’ and rental prices have soared into the stratosphere.” It is crucial that Maui County Council not continue to approve new development unless the infrastructure is in place or under construction that has the capacity for current users and future users.
Real Estate Tips
As we transition from a Seller’s Market to a Buyer’s Market, the Buyers will gain more leverage. In many different real estate markets the Seller has been in the “driver’s seat” and we are seeing that change. Buyers are choosier, homes are staying on the market longer, and prices are not rising as fast as they were. Sellers need to realize the transition is coming and be prepared to deal with it realistically. The remodeled home or condominium always sells in a shorter period of time and for a higher price. The Seller should consider having a Home Inspector prepare a report so the Seller will know what items require attention prior to the Buyer requesting the repairs prior to closing.
The Real Estate “Bubble” that we continue to read about will not likely occur on Maui. What we should see here is a gradual cooling of the market with the appreciation rate slowing. We will continue to experience is the transition from a Seller’s Market to a Buyer’s Market. What created the sudden drop of prices in the early 1990s was the result of the Savings & Loan Association scandals and the Resolution Trust Corporation (RTC) being established which foreclosed and took collateral pledged for loans. This had a dramatic impact on both residential and the commercial real estate market. At the time the Japanese investor was a major force in the Hawaiian real estate market and proceeded to exit the market place.
Ways to avoid Capital Gains Tax when selling.
- If you inherited property, don’t forget your “stepped- up basis.” This is usually the property’s fair market value on the date of the deceased owner’s death.
- The primary residence exemption of $250,000 or $500,000 for a married couple.
- Internal Revenue Code Section 1031 Tax-Deferred Exchange.
- Installment Sales
- Tax-Free investing within your Roth I.R.A.
- Private Annuity Trusts
- Charitable Remainder Trusts
These seven methods are excellent ways to avoid payment of capital gains tax when disposing of your personal residence and/or investment real estate. You can also create tax-free or taxable income for yourself and your family. Or you can donate your real estate assets to a favorite charity while enjoying property benefits and income during your lifetime. For additional details consult your personal tax adviser.
For those of you who enjoy or use the internet on a regular basis or use your computer frequently, here are some interesting web sites you may want to visit.
http://www.zillow.com - This is a relatively new site that properties owners can utilize to assist in valuing their properties. This is a test site or Beta Site. Although this information can provide close estimate it can be far below or above the actual, market value.
http://www.free411.com -This is a free information service but you do have to listen to a 15 second commercial however this is cheaper than paying $1.50 to $3.00 to obtain a phone number. You can also dial from you phone 1-800-373-3411 and cell phone are included.
http://www.caringbridge.org - This non-profit organization provides (at no cost), personalized Web sites to those wishing to stay in touch with family and friends during significant life events such as major illness. The web sites can be set up within about three minutes that allow family and friends a unique method of communicating during difficult times.
http://www.timeticker.com - This is a great place to check on the various times in different time zones. The times are also adjusted for daylight savings time and other idiosyncrasies of the area. For those of us who live in Hawaii and receive phone calls at 3:30 AM this is a nice gift to give.
http://www.komando.com - This is a great site for staying current on new technology, new software and internet issues.
Kindest Regards,
Jim Foster
Chase 'N Rainbows Real Estate, Inc.
P.O. Box 10398
Lahaina , HI 96761
Toll Free 888-661-7994
Direct Line 808-661-7994
Cell 808-870-5858
Fax 808-667-2957
Real Estate for Sale www.jamesbfoster.com
Vacation Rental www.chasenrainbows.com
Email jim@jamesbfoster.com
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