With the high-season of Maui’s real estate activity well under way, many buyers are curious of the current state of the market. After all, informed buyers are the best kind of clients. And with ‘short sales’ and ‘foreclosures’ being on the forefront of real estate news, I thought it’d be a good opportunity to share relevant data on which buyers can draw conclusions.
January proved to be a good start for 2011, with 54 sales of Single Family Residences (SFR) taking place. Of particular note, of those transactions 22 (40%) were REO’s and 3 were short sales (5.5%). To put it into perspective, of the current inventory actively for sale, REO’s account for 5.5% and short sales are 8.4%. Condos also had a strong showing, with 87 sales, compared to January 2010′s 75 sales. Of these 87, REO’s accounted for 24 (27% of total sales) and short sales tallied 8 transactions (9%). Again, to get a better understanding on the significance of these numbers, there are 1,215 units actively for sale, of which 3.7% are REO’s and 7.3% are short sales. Clearly REO’s and short sales are being absorbed at a markedly faster pace than conventional sales.
Is there a clear reason for this? Although it could be argued that you get what you pay for when purchasing REO’s (i.e. no seller’s disclosure, typically poor-fair property condition), ultimately the reason for such a significant discrepancy in absorption rate is pricing. Bank-owned properties and short sales in the Maui market tend to be priced at the bottom of the price spectrum, making it difficult for conventional sales to compete. For those buyers who are willing to see past conditions and make some changes, there is a myriad of opportunities to get great values.