Sotheby's International Realty®

How We Connect Your Property to Qualified Buyers
Such distinctive homes can attract interest from far beyond your local market. Along with an enviable network of local contacts, your Sotheby's International Realty® broker has the advantage of a relationship with a national and worldwide community of expert real estate professionals. When you list your home with a Sotheby's International Realty® office, it is presented to prospective purchasers from all over the world in addition to your neighborhood. Our network includes associates who understand their local markets and are able to identify appropriate prospects both within and beyond their areas. Sotheby's International Realty® marketing initiatives also offer exclusive access to Sotheby's auction house clients, and your real estate property listings are well positioned to attract the attention of these well-qualified buyers.
Island Sotheby's International Realty has three offices to serve your Maui luxury real estate needs. Our Upcountry office is located in Makawao Town and our two other offices are located in Wailea at the Wailea Town Center and The Shops at Wailea.

Buying REOs – Pros and Cons

Buying an REO or bank owned property can be a great opportunity for first time homebuyers and investors. However, before latching on to a bank owned property, it is important to realize that not all REO’s make sense. It is also important to obtain representation and weigh in all the factors. There can be additional costs involved and hidden costs for repairs. REO's may involve a lengthy closing process. Many prospective Buyers with the illusions of a "deal" may not realize what really is really involved in purchasing a bank owned propety. As such, it's important that you work with an experienced real estate professional to provide proper guidance.

The Pros:
The benefit to purchasing an REO is single. There is just one. It all boils down to money .... purchasing real estate at a discounted sales price. It can be a great opportunity for getting a bargain on a home. Especially if you don't mind putting in a bit of work to fix it up.

Generally the bank has a limited emotional attachment to owning real estate. REOs are categorized as a non-performing asset. The goal of the lender or bank is to mitigate further loss. So at times they may be willing to negotiate at a lower value than the typical sales transaction.

The Cons:
There are drawbacks to purchasing an REO, but they can be overcome.

Since the bank is now the Seller, there can be some additional paperwork involved. Also, rather than a General Warranty Deed, title is secured with a Special Warranty or Limited Warranty Deed. (The grantor, the bank, does not warrant against title defects arising from conditions that existed before they owned the property.) A Limited Warranty Deed is a formality. If a Buyer has concerns, he/she should consult with the title company or legal counsel.

The Bank will NOT provide a Seller’s Disclosure Statement. Knowing that, IT IS VERY IMPORTANT TO OBTAIN THOROUGH INSPECTIONS WITH THESE TYPES OF PROPERTIES. Buyers should hire a certified home inspector to provide a detailed breakdown on the condition of the home and whether it complies with current building codes. At times, a home may additionally require other professional inspections, such as a pool, HVAC, or roofing contractor. In addition, it is wise to investigate or inquire information about the surrounding neighborhood. Drive by the property at various times of the day and evening to obtain a sense of noise and traffic. Go online and investigate the crime rate for that area.

Properties are generally sold in “As Is” Condition. The Seller will not repair any damage to the structure, or replace or repair any appliances missing or broken. Basically, what you see is what you get! Other items that may not be provided to the Buyer prior to closing are a survey report and cleaning and may be additional costs to the Buyer.

Given the Pros and Cons, a Buyer should add up all the factors involved the purchase of an REO. Combine the cash required as a down payment, escrow and closing cost fees, inspection fees as well as the expense to retrofit or improve the property after closing. Next compare this value with other properties currently on the market and recent comparable sales. If the trade-off is lower, perhaps it is better to keep shopping. If however, the trade-off is higher, then purchasing a foreclosure or bank owned property may be a worthy investment.

On the whole the advantages of buying REO homes outweigh the disadvantages, especially for the first-time buyer, or the investor. Provided you are aware of the possible drawbacks and have a strategy for dealing with them, it can be a very good proposition.

For more information about REOs contact me.

Maui Real Estate Owned Property - REOs

I’ve been working with several buyers looking for property in various price ranges over the past several months. Occasionally, we’ve viewed a home that is listed as an REO or Maui Bank Owned Property.

REO represents Real Estate Owned, or Bank Owned Property. An REO is a class of property owned by a lender, typically a bank, after an unsuccessful sale at a foreclosure auction. A bank will typically set the opening bid at a foreclosure auction for at least the outstanding loan amount. If there are no bidders that are interested, then the bank will legally repossess the property. As soon as the bank repossesses the property, it is listed on their books as REO – Real Estate Owned – and is categorized as an asset (non-performing).

• As soon as a property goes into a distressed status (the borrower/home owner is behind on mortgage payments) the bank will want to determine the amount of equity that the property has. A popular method to determine the equity is to obtain a Broker Price Opinion BPO, or order an appraisal. Based on the amount of equity that is determined from the opinion or appraisal, the bank will decide to try for a short sale or to allow it to go through the foreclosure process. If the bank is able to sell the property through a short sale or at a foreclosure auction, then the property will not become a REO property.

• After repossession the property is classified as REO, the bank will go through the process of trying to sell the property on its own. It will remove some of the liens and other expenses on the home and try to resell it to the public, either through future auctions or direct marketing through a real estate broker (REALTOR). Generally speaking, bank REO properties are in poor shape in terms of repairs and maintenance; however, real estate investors will often go after these properties as banks are not in the business of owning homes and so, in some cases, the low price can more than compensate for the condition of the property.

• Once a property is an REO, the bank or lender will try to get rid of the property. The bank will either sell it directly themselves, or through an established broker. Many larger banks such as Bank of America and Wells Fargo have REO/asset management departments that will field bids and offers, oversee upkeep and handle sales. The majority of REO properties that are on the open market are listed in MLS by the REALTOR that performed the BPO. If you'd like more information on REOs, feel free to contact me.
  

Next, the pros and cons of purchasing an REO.

REO definition courtesy of Wikipedia

Makawao-Olinda Vacant Land For Sale

Yesterday I toured vacant land for sale in Olinda-Makawao. The location is exceptional, the pastoral setting, gorgeous! These properties are located near some of Maui's finest private schools. Seabury Hall is less than 5 minutes away and Maui Montessori which is no more than 10 minutes away.

There are five lots ranging in size from 2 acres to 40 acres. The properties are listed at values ranging from $495,000 for the 2 acres to $2,800,000 for 40 acres.

Lower Olinda offers an ideal climate with moderate rainfall... just enough to keep things lush and green. The land provides wide open feelings of privacy and space, while majestic trees frame beautiful ocean views. Owners will obtain benefits to a network of equestrian-walking trails through the 300+ privately owned acres of rolling pastures and lush gulches, gently meandering and connecting from Olinda Road through to Pi'iholo Road and nearly down to Makawao Town. Stunning and a rare buy! If you would like information in Upcountry Maui Real Estate, please feel free to contact me.

Listed by Island Sotheby's International Realty - Makawao
Patricia Chaney R(B) may represent you as a Buyer's agent.
Direct: 808.280.2625
Email me!

Rainbow Shower Trees - Nature's Fireworks

Over the summer months, like an explosion of fireworks, the Rainbow Shower trees on Maui show off there plumage with in an exciting array of vibrant warm colors. As the flowers age, the colors intensify and eventually shed to earth. Depending on the weather conditions, the blossoms can last until early October.

I stopped and took this photo in July during one of my frequent drives along Baldwin Avenue between the towns of Pa'ia to Makawao. This road is a scenic drive year round. At this time of year, it is twice the pleasure with the shower trees in full bloom.

Obon Dance & Festival - Paia

Saturday night I attended the Obon Dance and Festival at the Paia-Kuau Mantokuji Soto Mission. Obon is a festival that takes place on the fifteenth day of the seventh lunar month (July–August) in which offerings are made to the spirits of the deceased. The Buddhist ceremony originated in China around the 6th century and over the centuries has absorbed elements of non-Buddhist beliefs and practices.

I loved the Taiko drummers who opened the evening ceremony. I was impressed by the variety of drummers from young to old and their varied level of skill. I also enjoyed watching the dancers, the willingness of so many to participate, regardless of their knowledge of the dances. Next time I attend an Obon, I may be tempted to participate and dance.

The next Obon Dance & Festival takes place in Makawao Town at the Hongwanji Mission on Friday July 24th & Saturday, July 25, 2009. Services begin at 6:30 pm and festivals start at 7:30 pm.

Maui Real Estate Statistics - June 2009

Maui real estate statistics for the month of June have been compiled by the Realtor’s Association of Maui. The number of home sales rose from 56 in May to 62 closings in June. Condo sales fell slightly from 47 in May to 45. Land sales fell from 8 to 7. Once again, Central Maui has held the lead in Maui home sales with 20 closings this month, again generated by short sale, bank-owned and developer inventory.

For the month of June, the median price for residential real estate was $499,053; the average residential home price for June was $761,252.

Year to Date: Residential unit sales declined (-41%), average sold price = $761,252 (-14%), median price = $510,000 (-14%) and total dollar volume sold = $216,956,818 (-49%).

Condo unit sales declined (-46%), average sold price = $685,584 (-29%), median price = $420,000(-27%). Total Condo dollar volume sold = $188,535,561 (-62%).

Land – NOTE: Land Lot sales are such a small sampling that statistics in this property class are not necessarily reliable indicators.
Land lot sales declined (-29%), average sold price = $1,433,038 (+52%), median price = $800,000 (+14%), Total dollar volume = $70,218,875 (+8%).

Total sales for the past 12 months:
Residential = 718
Condo = 568
Land = 79.

On the positive side of this story, nationally 53% of the home sales this year are to first time home buyers!

For the full report, see Maui Real Estate Statistics - June 2009

Photo-Voltaic Solar Sun Tour

The 4th Annual Solar Sun Tour is this Saturday, July 11, 2009. The tour program provides property addresses, directions and info on each property. The tour includes PV and solar improvements to commercial and residential structures. This is a self guided tour, so you choose the properties you want to see, and go visit them during their available time slot. Here's the link to the program: Click here to download and print the program.

Maui Foreclosures - Bank Owned Properties

There are some incredible values in the market today that are Maui foreclosures or bank-owned properties. Available properties range from golf course vacant lots to beachfront residential property. If you've been waiting for the opportunity, NOW IS THE TIME! OPPORTUNITY IS KNOCKING!

Maui Residential Foreclosures

Maui Vacant Land Foreclosures

Maui Residential Home Sales

The First Six Month of 2009
Over the past several days, I've collected data from the Realtor's Association of Maui - RAM's MLS website. Here is an unofficial breakdown of Maui residential sales activity by district for the past six months, beginning Jan. 1st to June 30th 2009. This data reveals some interesting figures:

Upcountry Maui Homes - # of Sales - Median Price
Pukalani - 20 - $512,000
Makawao - 11 - $452,500
Kula - 8 - $756,000

North Shore Maui Homes
Haiku - 10 - $612,500
Paia - 6 - $489,500

South Maui Homes
Kihei - 61 - $470,000
Wailea/Makena - 9 - $1,735,000
Maui Meadows - 2 - $997,000

Central Maui Homes
Wailuku - 78 - $477,928
Kahului - 38 - $485,000

I have not mentioned all of Maui residential real estate such as areas as Hana and the West side, or included the activity on the islands of Molokai and Lanai, as I don't focus or specialize in these areas.

Throughout the entire island including the districts not mentioned, there were 28 properties that closed as short sales, 45 closings were bank owned and a total of 285 residential closings over the first six months of 2009. That's an average of 47.5 closings a month. The high sale was a Kihei beachfront home located on Keawakapu Beach closing at $11,250,000. The low sale was a residential condo in Kihei closing at $160,000. The median sales price for the entire island for Maui was at a sales price of $510,000. This is a brand new two story 3 bedroom, 2.5 bath home with 1,633 sq.ft. of living space on a 6,563 sq.ft. lot located within The Cottages at Kehalani. Here's an idea of what a $510,000 home currently is on Maui. Keep in mind these were residential sales only. Of the 78 sales in Wailuku, 40%, or 31 of the homes sold were newly constructed project sales at either The Cottages or Akolea at Kehalani.

Over the next week or so, I'll explore condo and land sales. RAM should be sending out the statistics for June 2009 soon and I will post those results.

Makawao - 4th of July

The 44th Annual Makawao Paniolo Parade starts at 9:00 a.m sharp on Saturday, July 4th in Makawao Town. The parade starts at the Makawao Veteran's Cemetary and ends at the Eddie Tam Center.

This is the time of year to dress up in your best paniolo duds and enjoy "Upcountry Maui" small kine/small town parade. Unique, charming and full of characters, this year's parade is showcasing the theme "Celebrating the 50th Anniversary of Statehood." Bring your beach chairs, suncreen, spam musubi and water! After the parade, hele on up to the Makawao Rodeo at the Oskie Rice Arena in Olinda. The 51st Annual Makawao Rodeo starts today, Thursday, July 2nd and runs thoough Sunday, July 5th. The rodeo starts daily at 1 p.m. So, hang loose and hang out for a fun time! Wee-Hah!