First Hawaiian Bank has released their annual analysis for the Maui economy going forward and here are the key findings:

• Maui will continue to grow, but more slowly
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  It’s hard to overestimate the effect that a dampening of real estate has on the overall economy:

  The market obviously affects construction. If home prices drop, buyers stay on the sidelines and wait. Home furnishings and durable goods sales decline along with home sales. Even general retail spending suffers if people feel they are worth less on paper — and their home is usually their biggest asset. (see chart below)

• Maui's tight labor market will continue

• Tourism will weaken somewhat

• Construction permits slowing (see chart below)

• National GDP growth to approach 3% in 2008..

The whole report can be found here http://www.fhb.com/pdf/EconForecastMaui07.pdf