Today's question comes from a Buyer who is interested in purchasing a condo in Kihei. We are posting with Buyer's permission, for the benefit of others who may have same or similar question.

Question: My family and I are looking for a condo in Kihei to buy and we want to rent it out when we're not there. The problem that I'm facing is that I'm finding conflicting information as to which complexes allow vacation rentals. Any help would be really appreciated on this.  For prospective purchasers looking into the Maui condo market, one of the first questions is whether the unit will be used as a short-term rental when not occupied by owners and/or their guests. To start, there are many terms that are generally meant as interchangeable in this context:…

As one of the most active micro-markets in Hawaii, it is pertinent to follow the Honua Kai Real Estate micro-market, to see how it behaves comparative to other subsets, particularly as the Luana Garden Villas sales market begins to develop in phases. The beginning of the year encompasses the high-season influx but in previous year the swing has been much more minimal as activity becomes more year-round than cyclical.

Honua Kai Studios

In the first half of the year, there was only one Studio listed for sale, Konea 521. Although at first glance it might seem as though the price of $975K may be on the high end of the spectrum, as can be ascertained from the Honua Kai Investment Analysis, the Studios are among the highest return on investments anywhere in…

In the State of Hawaii, when a non-resident (defined as any person other than a Hawaii resident) sells their interest in real estate, there is an applicable tax withholding on the amount realized, which is generally the sales price. The amount withheld has been 5%, however new changes as passed via Senate Bill (S.B) 508, S.D. 1, H.D. 1, C.D. 1, now increase the amount to 7.25% for any transaction that closes on or after September 15, 2018.

As per the Announcement published by the Department of Taxation:

"In sum, a transferee or buyer must withhold 7.25 percent of the amount realized by the transferor on the disposition of Hawaii real property if the transfer occurs on or after September 15, 2018, unless an exemption applies." There are applicable…

Open Table has become the de facto leader in restaurant reservations - such a relationship with dining customers has transformed into arguably the most robust review database of restaurants in the US. Based on over 12M reviews from verified Open Table reviewers of over 27,000 restaurants nationwide, Open Table has released their list of Top 100 Al Fresco Restaurants in America. Hawaii is honored with 10 restaurants in the top 100 - what may be surprising is that 7 of those 10 are located on Maui. 

Hawaii's Restaurants:

Hau Tree Lanai - Honolulu, Oahu
Keoki's Paradise - Koloa, Kauai
Monkeypod Kitchen - Koolina, Oahu
The Mill House - Waikapu, Maui
Mama's Fish House - Paia, Maui
Leilani's on the Beach - Kaanapali, Maui
Kimo's Restaurant - Lahaina, Maui
The Hula Grill…

Today's question comes from a long time client:

Question: We've been looking at buying in Mana Kai for some time now, how's the market doing there?

Answer: Great question - we're a bit biased as Mana Kai is one of our favorite properties on Maui. Historically Mana Kai has been a 'legacy' property, with many units trading hands either generationally (passed down within a family) or internally (owners selling to other owners and/or friends). Since the market crash in 2008, units have come on the market at more constant pace under open market conditions. 

Let's take a look at the charts below for a baseline of analysis:

As can be ascertain by the above, there was a peak in 2016 in terms of sales prices. However, although it is not reflected/adjusted on any

…

It is not very often that we see REO's (bank owned / 'foreclosure') homes in the Wailea Real Estate market, so the listing of 197 Halau Place is certainly worth noting. The 3 bedroom / 2.5 bathroom certainly needs some work, but with over 3,600 square feet of interior living space, the property has great 'bones' to work with. Other nearby homes start in the high $2M's and go upwards to $6M for the more premium lots, so it is eye catching when seeing the asking price for this home at $2.15M. 

The location of this particular home is interesting. A corner lot generally offers more privacy and maximizes light, but as one of the entry points into Wailea Golf Estates Phase II, it is bound that at some point there will be more construction equipment/vehicles…

Today's question comes from a client interested in purchasing a home in Wailea.

Question: We have been looking at homes in Wailea for some time, how is the market particularly in the higher-end of the spectrum?

Great question. Let's look at it from two perspectives. First, how has the higher end of the market fared over the past few years. Take a look at the chart below which details the number of sales of single-family residences with a sales price over $5M. As can be noted, as of the date of this post being published (June 12, 2018), we're not quite at the midway point of the year but so far there have already been 7 sales of SFR's on Maui closing with a sales price above $5M. With 3 more sales currently in escrow and half the year still go, it is more…

As the Kihei home real estate market continues to be one of the most interesting ones, particularly in the entry to mid level, we are posting our Piilani Villages micro-market update, with an emphasis on Phase I. For those unfamiliar with Piilani Villages, it was developed in three phases: Phase I being the most northern one off of Kulanihakoi, with homes being built in the early 1990's and most lots ranging in size from 6,000 to 8,000 square feet. Location within the subdivision is critical as those on the eastern perimeter border Piilani highway and are subject to significant road noise (tolerance being subjective). Piilani Villages II and III are very similar in design and floor plans available, with both phases being built in the 2002-2003 timeframe.…

Update: For the latest Maui Property Tax Rates and to compare to other Counties in Hawaii, visit our Hawaii Real Estate Tax Rates page.

In an effort to keep our clients updated on Maui County property tax rates, we are posting the new tax rates for the fiscal year which runs from July 1, 2018 through June 30, 2019. For the most part, tax rates are very slightly adjusted to the previous year but it is absolutely worth noting that there is a new category: Short Term Rental.

Rates are as follows, based on $1K of assessed value:

Single Family Residence:  $2.86 (Homeowner) and $5.52 (Second Home)
Agricultural: $6.00
Hotel/Resort: $9.37
Apartment: $6.31
Short-Term Rental: $9.28
Commercial Residential (see note below):  $4.55
Conservation: $6.35
Industrial:  $7.45
…

In an effort to continuously keep our clients updated on micro-market conditions, we present our monthly Honua Kai  market update. This shall encompass new listings on the market, those that have gone into escrow during the month, and closed sales for the month.

New Inventory

The Honua Kai micro-market continues to see increased inventory, particularly after the developer finished its sales and re-sales have dictated values, available inventory, and absorption. The month of May saw a good amount of new listings:

Konea 521 - Studios are in short demand, particularly those on higher floors. As Konea 521 came on the market, even with its large floor plan for a studio (at 615 square feet), the asking price of $975K may have seem above market to some, but…