July 18, 2010

Kihei real estate market

Despite a trend of recovery and gradual growth, the Kihei real estate market, a component of the larger Maui housing market, continued to face some challenges, such as a new proposed property tax increase. According to a June 2, 2010 article from the Maui News, “Condominium owners turned out Tuesday to oppose legislation that would push thousands of units into a higher property tax classification, saying it would be an unfair burden and could drive more condominium units into foreclosure. While there are 26,701 condos in Maui County, 3,565 of those would be affected by the tax change, according to property tax officials. But that fraction would be hit hard – condo owners affected by the law change would have paid a cumulative $9.1 million in additional property taxes if the legislation had gone into effect this year. “That’s a lot of money to come out of one class of property owners,” said Dave DeLeon, government affairs director of the Realtors Association of Maui. “I think this is very unfair,” said condominium owner Steve Tenney. “It’s draconian.” The proposed legislation would require condo owners to pay taxes according to the “highest and best use” of their properties, as other landowners now do.”

However, the economic recovery should provide a boost to Kihei homes for sale, as well as the rest of the Maui real estate market. According to a June 26, 2010 article also from the Maui News, “The long-awaited economic recovery will start in Hawaii and on Maui at the start of the new fiscal year – “also known as next week,” economist Paul Brewbaker told the Maui Chamber of Commerce on Friday.” The report by Chris Hamilton went on to state that “The state Council on Revenues chairman and principal owner of TZ Economics said that the recession already has ended and that his analysis predicted actual economic growth, not seen since the bottom fell out of the local and national economies nearly two years ago. “I think we’re on the threshold, but Maui is still lagging behind the rest of the state,” he said Friday after his speech. “The challenge I see is that perceptions are slow to adjust to the coming changes.” Brewbaker briefed about 130 Maui business leaders at a Chamber of Commerce luncheon at The Fairmont Kea Lani, Maui resort.”