Median home price
on Maui sets recordMainland buyers drive a sizzling
market for neighbor isle resales
The median resale price of a single-family home on Maui shot to a startling $620,000 in May, a record high and a 66.4 percent gain over the previous year's $372,500, as deep-pocketed mainland buyers that have driven neighbor island real estate markets kept digging deeper and deeper.
The robust growth may have been magnified by sharply lower sales volume on the inventory-depleted Valley Isle. There were 87 single-family homes sold in May -- one of the lowest monthly totals in a year -- compared with 140 in May 2003, and prices may have been skewed by a number of million-plus sales in exclusive areas such as Sprecklesville that pulled the median figure higher.
"You're going to have blips and bumps in a tight market like this," said Terry Tolman, executive director of the Realtors Association of Maui.
"The whole pond is so small that any fish is a real big fish."
Still, the figures gave brokers pause.
"Wow. Pretty amazing, isn't it?" Realtor Fred Haywood said when told of the numbers.
Haywood handled a number of the Sprecklesville sales in May that went for upward of $1.4 million, and offered some advice for any kamaaina who are considering selling."I think they should be very careful. They may not be able to afford anything else here," he said.
Maui condo prices also climbed year-on-year, hitting a median $276,000 compared with last year's $222,500, a 24.3 percent gain. Volume was slightly lower in May at 164 units sold compared with 188 a year earlier.
The median price is that at which half the prices are lower and half are higher.
Prices on Kauai and the Big Island surged as well. A single-family home on Kauai fetched $472,000, a 27.7 percent gain over May 2003's $370,000. Condominium prices there gained 26.4 percent to $381,000, up from last year's $302,000.
There were 62 single-family homes sold on the Garden Island, up from just 46 last year. But the number of condos sold dropped to 36 in May from 62 a year earlier. Again, inventory seemed to be a key factor.
"There are just as many people out there looking, but we're down to nothing to sell," said Ken Kubiak, broker-in-charge with Century 21 All Islands in Kilauea on Kauai.
Brokers said the investors and second-home buyers, primarily from the mainland, who have seized neighbor island markets by the throat during the last couple of years appeared unfazed by the recent rise in interest rates.
"Most of the people we deal with are those investors who come out and pay cash, and they don't seem worried about rates at all," Kubiak said.
Kauai has been a prime example of the strength of the investment influx by mainlanders enamored with the less urbanized neighbor islands.
Despite its far smaller economic base, Kauai's median home prices have climbed far higher in the current price boom than Oahu's, which were a median $445,000 for single-family homes and $195,000 for condos in May.
On the Big Island, single-family home prices grew 26.7 percent to $307,261 from $242,500. Condo prices there leapt 62.8 percent to $280,000 from $172,000. Single-family sales were up 25 percent to 224 from last year's 179, while condo owners sold 89 units, up 15 percent from last year's 77.
Robert Cheesbrough, a partner in broker-developer the Prestige Group LLC, said sales in higher-priced West Hawaii areas such as North Kohala and Waikoloa were still strong but that buying was also beginning to spill over into the Hilo area.
"Compared to the rest of the island, Hilo is beginning to look like a good land value," he said.
Cheesbrough said he expects the market to stay strong for about another year as members of the aging baby boom generation begin to inherit billions from their parents.
"They're generally immune to market swings, and they'll remain the main demographic for some time," he said.
