As the recession continues to take its toll on the national real estate market and speculation abounds a possible double dip, the Hawaii market remains resilient. And although droves of first-time buyers and investors are flocking to what is regarded as a long-term equity market, the sector that is proving to be most interesting is the luxury stratum.
There have been a number of sales that are reflective of wealthy buyers showing confidence in the Maui real estate market. For example, three months ago Paypal co-founder, Peter Thiel, paid $27M for a Makena beachfront single-family residence, setting the record for highest amount ever paid for a property in Maui County. The previous record had been set the year prior at $19.85M for another Makena estate. In addition, the North Shore is a mecca for free-spirits and water-sport daredevils (care to surf a 50-foot wave at Jawz?), making oceanfront/beachfront properties highly sought-after. Yet the highest sale recorded in the North Shore came two months ago, as a Spreckelsville oceanfront home sold for $9.65M, shattering the previous record of $5.85M set at the peak of market in 2007. Furthermore, Maui luxury condos are known for having a high price tag and numerous sales during the 2005-2007 boom solidified such reputation. However, it was last year that the sale of a Wailea Beach Villa set the high mark at $12.5M for a Maui condo. And as Maui was recently named by Conde Nast as the ‘Best Island’ in the world for the 17th time and ‘Best Destination’ globally, interest in the Valley Isle by well-heeled buyers is sure to continue.
Although there are numerous metrics that point to a stabilizing market in Maui, what may prove to be the strongest factor pushing the market (and thereby the local economy) forward is the high-end sector. Perhaps the other Paypal co-founders are also looking for a place to call home. Aloha.