In a message dated 10/21/2005 9:04:26 AM Hawaiian Standard Time, peter@petergelsey.com writes:

Hi Mike, thanks for your mail.   All economic indicators seem pretty positive right now in my opinion.   My company's economists have looked closely at the Hawaii market and we do not currently see danger signs such as an overconcentration of owners in any one demographic class.   In 1990 we had a problem here when the Japanese economy collapsed in Japan due to their low margin requirements driving simultaneous bubbles in Japanese stock market and real estate.   Their central bank decided to raise interest rates and that kicked off a major recession that ended up causing Japanese owners in Hawaii to liquidate over here as well.   However today we do not have that kind of concentration among foreign buyers.   There is a large percentage of California buyers so if there were major economic problems on the U.S. west coast that could negatively impact our pricing here temporarily.   However what we have seen in the California market itself is that economic problems tend to slow real estate buying, but do not necessarily decrease pricing.   I.e. if sellers cannot get their price they tend to hang on until things recover, rather than selling below market.   So our expectation is that pattern could be repeated here, IF there were an economic downturn in California (which we we do not foresee).     So the net net is we do not see a slackening of demand or pricing support currently in the Maui real estate market.   No guarantees for the future but if you are bullish on the U.S. economy in general then Maui real estate is probably fairly attractive as well.
 
As far as your question about the next 2 year prognosis, it seems the team Greenspan has in place will continue his policies which have provided for an excellent U.S. economic environment.   Absent any calamitous events politically or economically things should remain very positive in Hawaii in my opinion.    Looking forward to getting together on your trip.   Best regards, Peter Gelsey www.petergelsey.com
 
In a message dated 10/21/2005 1:52:41 AM Hawaiian Standard Time, <email from U.S. mainland>  writes:
Peter:  Has Maui experienced the real estate bubble and do you anticipate prices coming down in the next two years?  Mike

Peter Gelsey
Coldwell Banker Previews International
www.wailea-makena-real-estate.com
direct (808)  357-4552
Toll free 800-482-5089
fax 240-524-2436
email pgelsey@aol.com