Choosing the right island can be a challenge when you’re looking to buy real estate in Hawaii. Each has its own unique set of qualities that add to its charm and influence the strength of your investment. For example, Oahu’s economy is strong, but its real estate market is saturated, while the Big Island of Hawaii tends to be the opposite. Meanwhile, Maui could easily be a Goldilocks scenario, representing a middle ground for each.
In 2015, the median price for a Maui home settled in at $580,000, while Oahu’s was $700,000 and the Big Island’s was $555,500. Prices may fluctuate for each of the islands, but they tend to stick to this pattern in relation to each other. If you’re thinking the affordable homes on the Big Island sound alluring, it’s time to factor in the other piece of the puzzle, which is demand.
Oahu housing comes at a premium because Honolulu’s economy is much more robust than the neighbor islands, while the Big Island’s is not so much and Maui’s falls in the middle. But here’s where Maui has a special advantage. Over the years, it has become an icon for the ideal tropical island getaway. Technically Hawaii is sub-tropical, but the balmy breezes, white sand beaches, cascading waterfalls and flaming sunsets are the things that really matter to visitors, and to the Maui home owners who rent to them. Maui features all of these in convenient proximity, unlike the Big Island, and without the skyscrapers of Oahu marring the scenery.
The value of a Maui vacation is widely considered the highest of all the islands, to the extent that its tourism officials facilitate an increase in prices to make the experience more exclusive to those willing to pay more. The goal is to have fewer visitors who pay a premium, rather than a lot of visitors paying less. The strategy has worked out well, except the part about fewer visitors. In fact, during the first week of this month, Hawaii saw a 1.9 percent dip in hotel occupancy to 73.2 percent, according to Hospitality Advisors and STR. Occupancy fell on all the islands, except for Maui.
Maui hotel occupancy increased by 2.1 percent to 74.7 percent. Oahu occupancy fell 2.6 percent to 78.6 percent. Big Island occupancy fell by 5.4 percent to 55.5 percent. And Kauai occupancy fell 3.7 percent to 63.8 percent. Keep in mind that although Maui’s occupancy is just behind Oahu’s, its room rates are significantly higher. During that same week, average Maui room rates were $280.02. Compare that to Oahu’s rates, at $216.60. Big island rates were $214.61 and Kauai rates were $232.21.
At the end of the day, Maui offers moderately priced real estate within the Hawaii spectrum, and a visitor industry that keeps the accommodation rates high and still achieves a high visitor occupancy. If a good investment is what you’re after, we’re sure you get the idea about the opportunities here. If you’re interested in South Maui real estate, give us a call. You’ll find our contact information at the bottom of the page, and we look forward to putting our market expertise to work for you. Mahalo!