Brewbaker: Bottom has passed for home market
WAIKAPU – Hawaii economist Paul Brewbaker said Friday that there are no longer bargain-priced homes left on Maui from the Great Recession several years ago.
“We have turned the corner,” Brewbaker said about residential real estate values in Maui County.
People waiting for lower home prices or prices to drop are out of luck. As surfers would say: “Dude, you should have been here yesterday,” he said.
The longtime Hawaii economist, formerly with Bank of Hawaii, made his presentation to more than 100 people at the Realtors Association of Maui’s general membership meeting at the King Kamehameha Golf Course in Waikapu on Friday.
According to statistics from the Realtors Association of Maui, during the first six months of this year compared with the same period in 2012, median sales prices for single-family homes in Maui County jumped 20 percent to $542,000. Condo median prices rose 6 percent to $372,500.
In June, the median price of a single-family home rose to $615,000, the highest since August 2008, statistics show.
“The values are back now,” Brewbaker said after his presentation. “The demand side is coming back.”
He estimated that the lowest prices for homes – or the “bottom” – was around 2009 and 2010.
“That was the moment” for people to buy homes, he said.
But buying a home was not likely on the minds of most residents at that time. They were worried about hanging on to their money and their jobs, he said.
Things have improved since then. Brewbaker said that the Maui housing market is currently at the midway point.
“It’s halftime, brah,” he said.
The trend of rising home values could continue three, four or five more years, he said.
Maui’s market is very different from places such as Iowa, Brewbaker said. There, property values rise until area residents cannot afford them, and market growth halts.
On Maui, outside investors who are attracted to the islands continue to feed the market, he said.
As far as the economy goes, Brewbaker said that Maui’s unemployment rate as of May was hovering around 4.9 percent. Many jobs have been restored in Hawaii, but on Maui many construction jobs have not come back as quickly.
That may reflect why not many homes are being built on Maui. Brewbaker said that hurdles typically tied to building homes are geography and regulations.
The Realtors Association of Maui said earlier this month that there is a declining inventory of both homes and condominiums, therefore prices are moving upward.
Earlier this month, there were only 19 homes in Maui County priced under $350,000 and only 134 from $350,001 to $750,000 on the market, according to RAM. In the condo market, there were only 156 units for sale under $350,000.
* Melissa Tanji can be reached at email@example.com.