About Lahaina's Kapalua Ridge Villas

Last month, a Seller at the Ridge Villas made news in the Kapalua Resort market when their Ridge Villa was listed at $495,000 in MLS. The one-bedroom, fairway view property had previously been listed at $825,000 and $785,000.

On the face of it, it looked like a phenomenal deal--the next lowest priced listing was at $740,000 and the four most recent one bedroom sales averaged $1,040,000. But the listing was actually an auction, and $495,000 was the opening bid only. In speaking with the listing agent, it was explained that the Seller actually had a reserve price, which would not be made public. If it was not met, the Seller would not move forward with the sale.

The auction ended on May 15th and the listing quietly expired. I followed up with the listing agent, who explained that they had several bidders, but the highest bid did not meet the reserve.

The auction format did stimulate interest in the Ridge Villas, but also effectively froze the market for other properties as prospective buyers waited to see if the property sold and at what price. Sales at the Ridge Villas have been slow, with the last sale in July of 2008. There are currently 24 listings at the Ridge Villas, ranging in price from $740,000 to $1,995,000.

A market summary follows below:

I've been working with Kapalua Realty since 2000, and this is quite an unusual development in the Kapalua Resort market, which has seen very few foreclosures, and even fewer auctions.

Ridge Villa 2512, a one bedroom, two bath single level villa, has been listed at $495,000 in the MLS as an opening bid. Currently, this is now the lowest priced listing at the Ridge, with the next lowest being 2122, listed at $740,000.

Per the listing agent's website: "If you are the winning bidder, you agree to submit a Hawaii Association of Realtors standard form Purchase Contract offering to purchase this property at the winning bid amount, and you may include all typical contingencies in your offer and propose your desired terms such as closing date, deposit amounts, and others. Just as in a normal real estate offer, the Seller may accept, negotiate, or reject the Purchase Contract. However, all Sellers have agreed to accept offers that are at a significant discount to their current listing price. As in any contract, your rights and responsibilities will be governed by the Purchase Contract, and you will not be obligated to purchase the property until all conditions and contingencies have been fulfilled. If you are the winning bidder, you may choose to have your own Hawaii-licensed real estate agent submit your Purchase Contract."

Per their website, bid increments are $5000. According to tax records, the property was most recently purchased in 2004 for $610,000. I spoke with the listing agent who indicated that this is not a distressed sale or bank owned. The highest bidder will be notified if their bid is accepted (the Seller has a reserve which will not be revealed). The bidder's agent will then prepare a purchase contract with standard contingencies (financing is permitted, as are inspections, document disclosures, etc). In researching the property history on MLS, it was originally placed on the market at $1,250,000, and reduced to $785,000 before the listing expired.

The Ridge Villas were built in 1980, and consist of just 161 one and two-bedroom condominium residences located in 28 buildings on 21.5 acres. Amenities inclulde two swimming pools with recreation areas, BBQ facilities, and a recreation room.

Please don't hesitate to contact me with any questions. The auction deadline has been extended to 5/15/2009.

The Ridge Villas are a small low-rise, low-density condominium community located in the Kapalua Resort. There are just 161 one and two bedroom condominium residences located in 28 buildings on 21.5 acres. The Ridge Villa views are outstanding and varied: you will find residences perched on a bluff overlooking the ocean or looking across the famed Bay Course. Floorplans range from single levels to townhouse styles.

Just across the street from the Ridge Villas is Oneloa Bay, one of the white sand beaches that stretch across the Kapalua Resort's coastline. The Ridge Villas are at the heart of the resort, and within walking distance of the Ritz-Carlton Hotel, shops, restaurants, beaches, tennis and golf.

Current pricing ranges from $785,000 to $1,350,000 for a one bedroom floorplan; $1,349,000 to $2,500,000 for a two bedroom floorplan; $1,995,000 for a three bedroom (note: this is originally a two bedroom loft style, where the loft has been enclosed and bisected to create the third bedroom). This year, there have been four sales at the Ridge Villas, all one bedroom units, ranging from $935,000 to $1,250,000.

For more information on the Ridge Villas or any other Kapalua Resort property, don't hesitate to contact me! Aloha, Courtney