ownyourmauihome

Maui Real Estate


Leave a comment

Understanding Affordable Housing

This past January, Alexander & Baldwin, one of Hawai‘i’s original Big Five corporations, kicked off the year with a groundbreaking for its newest residential development, Kamalani, in north Kihei. The dirt-and-shovel affair also promises groundbreaking opportunity: a long-awaited and much-needed affordable housing component.

On an island where most properties are out of reach for the average first-time buyer, this is big news. We interviewed Grant Chun, vice president of A&B Properties, to learn more.

How is affordable housing defined?

It is not low-income housing, nor government-assisted. Per the County of Maui, affordable housing must be attainable to buyers whose household income is 80 to 140 percent of median income. On Maui, median income for a family of four is $76,700.

So families with a household income of $61,360 to $107,380 would qualify?

Yes.

How much will Kamalani’s affordable homes cost?

Prices will start in the high $200,000s and go up to the high $400,000s for condos and townhomes. The pricing is determined through a formula provided by the County of Maui, based on median income and prevailing interest rates.

The units will be available to the various income groups under different price points, as required by County ordinance. For those earning 80 to 100 percent of median income, homes will stay on the market at that level for ninety days. They can then move to the next income level, 100 to 120 percent of median income, for ninety days, followed by the highest level, 120 to 140 percent of median income.

If, after that time, there are still affordable homes available, the County will open the opportunity to off-island folks [who qualify for affordable housing]. After all those markets are exhausted, remaining units would go into the mainstream market. The entire process takes about a year.

What kind of demand to you expect?

This is the first time we’ve offered homes under the County’s affordable-housing ordinance. Market research tells us there is a tremendous shortage. Therefore we expect strong demand from entry-level buyers. When the first affordable units go on the market later this year, applicants will be invited to put their name on a list for the opportunity to purchase by lottery, and then vetted to see if they qualify.

What kinds of loans are available to families interested in the program?

The best are provided by banks and other lenders that work with federal programs such as Fannie Mae and Freddie Mac. These programs are designed for first-time buyers.

Are the rates more favorable for those qualifying for affordable housing?

Yes. Federally assisted loans may offer lower rates, and also lower-percentage down payment.

An important thing to know about some of these loan programs is homebuyer education. Since the economic downturn, many lenders now require the borrower to take an approved course in home buying, which includes a one-on-one counseling session and a credit report. Many folks earn enough money, but because of their lifestyle, may not qualify for a loan. The course provides information on what a mortgage is, what the costs of homeownership really are, and what responsibilities the borrower is accepting when taking out  a loan. A&B is requiring first-time applicants to take such a course to be eligible for Kamalani’s sales lottery, so that when it comes time to apply for the loan, they’ll have the best chance to qualify.

Who offers these classes?

The course is currently provided through Hale Maha‘olu for $75, and is two sessions. A variety of dates are offered, plus an online version. Potential borrowers who complete the class receive certification that they have satisfied the requirement for these loans. This is a great tool, regardless of whether the borrower is interested in Kamalani or another project.

How much of Kamalani is set aside for affordable housing?

Out of 600 units, 170 in the first increment will be affordable: two- and three-bedroom condos and townhomes.

Are there rules for resale of affordable housing?

Yes. The owner is not allowed to sell the home until after a specified number of years. Owners who want to sell before that time are required to offer the unit to the County first. Additionally, the buyer may realize only 25 percent or less of the increased value during the restriction period — that is, the difference between the purchase price and the appraised value at resale. For example, if the home has increased in value from $300,000 to $400,000, the owner may sell for no more than $325,000. The intent is to encourage true first-time homebuyers and discourage speculators. After the specified time restriction, the owner may sell at market price.

Affordable units are sold at a loss to the developer. For the first-time homeowner, they can be a huge windfall — if the owner stays in the unit for the required duration.

What are the time restrictions?

Ten years for those qualifying at the first level of affordability [applicants earning 80 to 100 percent of mean income]; eight years for next level [100 to 120 percent]; and five years for the third [120 to 140 percent].

Are you working with specific lenders?

Yes. Our lead lender is Ann Sakamoto from Central Pacific Bank. Bank of Hawai‘i and American Savings are also participating.

What is your advice for families interested in affordable housing?

Take the Home Buyer Education class as soon as possible. Seating is limited, and advance registration is required. To register, call 808-856-4045, or go online at KamalaniLiving.com. The website also has information on eligibility requirements for the County’s Residential Workforce Housing.

Advertisements


Leave a comment

Basic Home Buying Process Explained

Buying a home in maui

Planning to buy a house for the first time? Or have plans moving into a new home in Maui? This article will explain to you the basic processes involved in buying a home.

Every state requires a slightly different process in buying a home, although they are the fundamentally same when it comes to the basics. Since buying a home is a huge financial commitment, knowing its process will help you pinpoint where to start and create a timeline as to what stages you are in and what specific fees you are going to pay.

  1. Hiring a licensed real estate agent

You probably would not be able to buy a house on your own. Even if you are simply buying from a friend, as a buyer you need somebody who will represent you known as a Buyer’s Agent. For beginners in home buying, it’s not advisable to rely on the fractional and outdated information that many online sources provide. In many instances, costumers are misled in believing pieced of information that have been abandoned by real estate writers in an effort to make themselves better in other real time aspects. When you get the wrong information, you also suffer from terrible consequences.

However, if you hire a licensed agent that good training, education, and experience, you are in good hands. Look for a good buyer’s agent who can carry out many tasks to the best interest of the buyer such as:

  • Advising the client with the pros and cons of specific and even personal real estate decisions during the process
  • Recommending a good list of houses based on what the buyer needs and after a thorough assessment of the motivation to buy
  • Educating the buyer on the market conditions
  • Doing the paper works and handle the ins and outs of the negotiation process

So here’s what you are going to do. Contact your local real estate agent to give you an advice on your current situation. The internet is also a haven of qualified real estate professionals, who can be a good fit for your needs.

pre-approved buying home in Maui

  1. Getting Pre-Approved

Before you meet with your agent, you must go to the bank and get a pre-approved letter. A pre-approved letter contains information such as the mortgage options, debt statement, mortgage ratio, and the amount of money needed to close a deal. These are important information that lets agents know which deal would be right for you.

  1. Looking for available properties

With a pre-approved letter on hand and other data, your buyer agent will be the one to normally look for houses to recommend to you. However, you can also do it on your own and have your choice assessed by your realtor.

When researching for a house, narrow your search to homes that exactly fit your budget and wanted designs. Ask a comparison of house for sale within your target location from the MLS listings and get additional inputs from your agent of the home you are interested.

purchase offer

  1. Giving a purchase offer

Once you have chosen a home, the next thing your agent will do is to prepare an offer. An offer will not be immediately final. Its terms and conditions need to be checked and approved by an attorney. The attorney can disapprove if there are disagreements between parties.

  1. Property inspection

Once both attorneys give the approval letter, you can proceed to the house inspection. The house inspection is done by a professional inspector who will give you a report of issues pointed out during the visits. The report may include structural issues of the house, its component, and life expectancy which are important factors that will help you in your decision.

mortgage application own your maui Home

  1. Mortgage application

Your agent will send a complete copy of the contract to the bank for the mortgage application but you still need to meet with the lender and formally apply for mortgage.

  1. Signing the commitment letter

Once the bank approves your mortgage, you will be given a Commitment Letter. A commitment letter is a written agreement that means you have passed the bank’s underwriting guidelines and that you agree to the payment schedule.

closing deal buying maui home

  1. Closing the Sale

Once all the paperwork are done, the final thing to do to finalize the sale is to sign the sales documents.  It would normally take a couple days or more for the bank to fund the loan, but once your loan is funded, you are ready to move into your new home.

Buying a home in Maui can be a daunting task. With the variety of homes available and unique advantages, the process can take some weeks or months. With this basic home buying guide in place, you’re sure of the next step and the proper actions you need to take.


Leave a comment

Yes, Home Prices Are Rising. No, a New Housing Bubble is NOT Forming

We recently reported that home prices are continuing to rise across most of the nation. This has created concern in some pundits that a housing bubble, like we saw ten years ago, is forming again. We want to explain why these concerns are unfounded.

The current increase in home values can be easily explained by the theory of supply and demand. Right now, the number of families looking to purchase a home is greater than the supply of homes on the market.

Here is a chart that explains how the months’ supply of housing inventory impacts home values:

impact

According to the latest Existing Home Sales Report from the National Association of Realtors, there is currently a four-month supply of inventory. That puts us in the blue section of the above graphic. Home prices should be appreciating.

The difference in 2006…

A decade ago, the demand for housing was artificially boosted by lending standards that were far too lenient. Today, the strength of the demand for housing is legitimate, as lending standards are nowhere near what they were a decade ago.

For proof of this, let’s look at a graph of the Mortgage Bankers’ Association’s Mortgage Credit Availability Index:

credit

The higher the number, the easier it was to get a mortgage. We can see that from June 2005 to June 2007, mortgage standards were much more lenient than they have been over the last nine years.

Bottom Line

Today’s price increases, unlike those a decade ago, are the result of qualified buyer demand exceeding the current inventory of homes available for sale. Once the supply increases, prices will level out.


Leave a comment

What If I Wait Until Next Year To Buy A Home?

As a seller, you will be most concerned about ‘short term price’ – where home values are headed over the next six months. As either a first-time or repeat buyer, you must not be concerned only about price but also about the ‘long term cost’ of the home.

Let us explain.

There are many factors that influence the ‘cost’ of a home. Two of the major ones are the home’s appreciation over time, and the interest rate at which a buyer can borrow the funds necessary to purchase their home. The rate at which these two factors can change is often referred to as “The Cost of Waiting”.

What will happen over the next 12 months?

According to CoreLogic’s latest Home Price Index, prices are expected to rise by 5.5% by this time next year.

Additionally, Freddie Mac’s most recent Economic Commentary & Projections Tablepredicts that the 30-year fixed mortgage rate will appreciate to 4.5% in that same time.

What Does This Mean to a Buyer?

Here is a simple demonstration of what impact these projected changes would have on the mortgage payment of a home selling for approximately $250,000 today:

Slide1-KCM

 


Leave a comment

Maui Charity Walk Remains a Fundraising Force in Hawaiʻi

‘Maui No Ka ʻOi’ is no joke, especially when it comes to the Visitor Industry Charity Walk, an annual 5K  that had more than 3,000 walkers pounding the pavement last year!

The Charity Walk is one of the largest single-day fundraising events in Hawaiʻi. Statewide, the events raised more than $2.2 million on Oʻahu, Kauai, the Big Island of Hawaiʻi, Maui, Lānaʻi and Molokaʻi in 2015. But Maui continues to raise more dollars per capita than any other island, for six years running.

In 2015, the walks in Maui County collected $863,268, and have raised a cumulative total of $9 million since the Maui Hotel & Lodging Association started hosting the event in 1980. All of the funds raised in Maui County remains here to benefit the local community & its residents, through hundreds of non-profit organizations on Maui, Molokaʻi and Lānaʻi.

“This event just touches my heart so much every year; we just keep raising more and more funds,” explains Lisa Paulson, executive director

of the Maui Hotel & Lodging Association. “So that we can support more and more nonprofits that are so important to this community.

This year, the 38th annual Charity Walk will happen Saturday, May 14 on Maui, and Saturday May 7 on Lānaʻi and Molokaʻi. Maui’s event starts at War Memorial soccer field with a fun-filled morning of warm-ups, food, prizes and entertainment.

Kick-off events are held throughout the islands to allow participants a chance to learn more about the event, how it works and to pick-up their packets, which include information on the Charity Walk, walker forms, posters, shells, flyers and other materials to promote & collect funds for the Charity Walk. There are a few kick-off events left in Maui County:

585473_1

– Monday, Feb. 29 at 10 a.m.: Wailea Marriott
– Wednesday, March 2 at 11 a.m.: Molokaʻi – Hotel Molokaʻi
– Wednesday, March 2 at 11 a.m.: Lānaʻi – The Lodge at Koʻele

A RSVP is requested at either info@mauihla.org, or 244-8625. Charity Walk participation

forms can be found by clicking here.

The annual Charity Walk is the Visitor Industry’s way of giving back to the community. Many MHLA property & business members work year round to raise funds for this worthy endeavor to help provide significant and valuable funding to over 100 worthy Maui County organizations:

ʻAoʻao O Na Loko I`a O Maui
Academy of Hospitality & Tourism
Ainsley’s Angels of America
Akakū – Maui County Community Television
Akaʻula School
Aloha House
Aloha Independent Living
Alu Like Inc.
American Red Cross
ARC of Maui

Assistance for Dogs of HI
Baldwin High School – AOHT basketballMaui
Best Buddies Hawaii
Big Brothers/Big Sisters of Maui
Catholic Charities Hawaii
Central Maui Hawaiian Civic Club
Child & Family Service
Christ the King Church
East Maui Animal Refuge
East Maui Watershed Partnership
Easter Seals Hawaii
Family Life Center
Feed my Sheep
Festivals of Aloha, Maui Nui Style
Frank DeLima’s Student Enrichment Program
Friends of the Children’s Justice Center of Maui

Girl Scouts of Hawaii
H.P. Baldwin High School Foundation
Habitat for Humanity – Maui
Hale Kau Kau
Hale Makua Health Services
Haliʻimaile Community Garden
Hawaii Animal Rescue Foundation
Hoʻokakoo Corporation
Horizon’s Academy
Hospice Hawaii Lānaʻi
Hospice Hawaii Molokai
Hospice Maui
Ierusalema Hou Church Youth Group
Ignite A Life
Imua Family Services

Ka Hale a Ke Ola
Ka Lima O Maui
Keiki Cupboard
Kiffman TaeKwondo
King’s Chapel Molokai
Lahaina Arts Association Lahainaluna High – AOHT
Lānaʻi Academy of Performing Arts
Lānaʻi Animal Rescue
Lānaʻi Art Center
Lānaʻi Community Health Center
Lānaʻi High & Elementary School Foundation
Leusoga Samoa of Maui Association
Malama Family Recovery Center
Maui Academy of Performing Arts
Maui Adult Day Care Centers
Maui Aids Foundation
Maui Crime Stoppers
Maui Economic Opportunity

Maui Economic Opportunity – Lānaʻi Maui Economic Opportunity – Molokai Maui Family Support Services
Maui Family YMCA
Maui Farm
Maui Food Bank
Maui Forest Bird Recovery Project Maui High School – AOF/DECA
Maui High School – AOHT
Maui High School – Band Boosters Maui High School Foundation
Maui Humane Society
Maui Memorial Medical Center Foundation
Maui Waena Band Booster
Maui Youth & Family Services
Mental Health Kokua
Molokaʻi Cancer Fund
Molokaʻi Filipino Community Council
Molokaʻi Island Foundation
Montessori Hale o Keiki
Na HoalohaMaui Interfaith Volunteer Caregivers
Na Puuwai – Lānaʻi Cancer Fund

Napili Bay & Beach Foundation
National Kidney Foundation
Pacific Cancer Foundation
PACT – Parents And Children Together
PATCH – People Attentive To Children
Ronald McDonald Charities of Hawaii
Roselani Place
Salvation Army
SPCA – Society for Prevention of Cruelty to Animals
Special Olympics Lānaʻi
Special Olympics Maui
Special Olympics Molokaʻi
St. Anthony Jr., Sr. High School
St. Rita’s Church/St. Joseph Church
Teens On Call
Theatre Theatre Maui
Westside Hoops
Women Helping Women

The Maui Hotel & Lodging Association is a nonprofit that also benefits the community through events like the Excellence in Education golf tournament and Kupuna Dinner. It provides educational opportunities via the Academy of Hospitality & Tourism and scholarships for UH Maui College students.


Leave a comment

Video Calling: How Effective Is It in Driving Leads to Your Real Estate Firm?

Video Calling

Modern technology has made the world smaller. Online apps such as video calls have also become crucial tools in lead generation and marketing in the real estate business.

According to a Gartner report, 20 percent of the world’s 500 biggest companies will be leveraging video chat in 2018. For firms like yours, this could a great opportunity to grasp to drive more customers in. By using video chat, you can communicate with your clients faster and give them a preliminary tour even if the client is not physically present.

Is video calling useful in driving real estate revenue? Well, the answer is affirmative. Communicating with your client face to face and touring them virtually are just part of a bigger benefit. Since almost everyone in the real estate market is starting to leverage video calling, it’s time to take your career into a whole new level.

Going Mobile.jpg

Going Mobile

Establishing mobile presence and offering video chat as one of the ways to communicate with clients is a good way to give your career a new lift. Almost 80 percent of the people nowadays use their phones to browse products and services, at least 50 percent of these prospects could be yours if you are on mobile. People love using phones because there is no hard and fast rule on when and where they are going to use it. So the first thing that you should do is to go mobile.

In order to succeed in this increasingly mobile landscape, you or your realty firm should be on board and be active all the time. Keep your status online and give your prospects one moment at a time. Take full advantage of the new technologies which could set you apart from other firms down the street.

Is it professional to use video calling? We’re are the point where anyone having the latest model of smartphone would want to shop, tour, or research at the convenience of their own home. Even at work, by using different mobile apps people are able to finish a lot of tasks without needing anything else. Hence, even those who still don’t own a smartphone yet would probably need to invest on one.

video-streaming

Streaming Videos and Virtual Touring

Personally visiting a house is a great way to have a closer look to its strength and weaknesses. It’s good to see every room, touch the walls and check if some parts of the house like the wall paints and decorations are wearing off. But as we all know this process can be really time-consuming. Hectic schedules and time conflicts often steer clear clients from pursuing visits and we are left waiting to fill in our own schedule with potential prospects.

For individuals who don’t have much time to personally come to view the house, video-streaming would be a great option to give them a preliminary house preview. By sending a recorded video or showing them a live footage, you are giving them the option to decide whether to go or not. At the same time, you can take this chance to show the core highlights of the particular house to encourage prospects to see it personally.

Virtual touring is also an excellent option for out-of-state prospects who want to view the house despite not being able to come. You simply just take the phone with you and turn on the video calling app, while going around the house.

Virtual-touring

Reaching out to International Buyers

Who says your real estate career is just limited in your own location. If this is how you think, then you are wrong. Video calling can spread awareness of your existence around the world. It broadens your market and allow people from the stateside to virtually tour houses.

When reaching out to off-state clients, expect that issues on reliability and connection will be raised. Even before that, you need to make that you have a good internet connection and reliable website which prospects can check from time to time.

video-testimonials

Collecting Testimonials from Clients

Gone are the days when people have to meet in one place to talk about who the best realtor is. Almost everyone in the world is using the internet to build websites and reach out to people with videos. Just like YouTube, you can collect testimonial videos from your clients and embed them in your site.

Videos give more than just a touch of personalization on your website. It allows positive feedback from past clients to go beyond the reach of your own personal connections. Rather than just quoting a plain text in one of your pages, a buyer’s honest views about your firm can add more value to your website.