Step 5: Understand What’s Different About Real Estate in Hawaiʻi vs. Other Places
The Market Is Competitive
Let’s face it: On an island, space is limited. And while real estate has gotten competitive on the mainland, it’s gone from competitive to ultra-competitive in Hawaiʻi. You’ll see this reflected in the percentage of properties in Hawaiʻi that are selling above asking:
In other words, when you’re buying real estate in Hawaiʻi, get your bid strategy ready early. Discuss it carefully with your real estate agent, and work with them closely to maximize your chances of getting the home you want.
Where Are the Most Competitive Places to Buy a Home in Hawaii?
According to Redfin, these are the five places in Hawaiʻi in which you’ll see the most competition for buying a house:
That’s why it’s so important to have an experienced agent on your side! More on that shortly…
Fee Simple vs. Leasehold
If you’ve browsed real estate listings in Hawaiʻi—especially in Honolulu—you may have noticed a detail that reads: “Land Tenure: Leasehold.” The other thing you’ll notice is that these properties are significantly less expensive than comparable ones listed as “fee simple.”
Hawaiʻi is one of only a few states in which you’ll see leasehold arrangements. (New York and Florida are the others.) Before you enter into a leasehold agreement, it’s important to understand that it’s different than buying a property outright.
Instead, a leasehold is something like a long-term lease, with some additional benefits and responsibilities. You can read all about leasehold properties in this article. While leaseholds offer an advantage to some buyers, a fee-simple arrangement is better for others. Make sure you do your research so you know which kind of property to pursue.
Island Traffic Is Real
For many people, one of the perks of paradise is the possibility of leaving a long, dull commute behind. However, you’ll still find traffic in paradise, no matter which island you choose.
In fact, Oʻahu’s traffic was once named the worst in the nation. And don’t think that the neighbor islands are immune. You’ll also find traffic backups on Maui, Kauaʻi, and the Big Island.
If the idea of a long commute turns your stomach, consider your family’s driving patterns when you’re choosing a neighborhood. Will you be going with the traffic or against it when you head to work? What about school? How heavy is the traffic in your area at the busiest times of day?
You don’t want to spend all your time in Hawaiʻi behind the wheel. Make sure you consider your location and your potential driving habits carefully before committing.
Hawaiʻi’s incredible and diverse ecosystems are one of the reasons many people move here. The idea of living right near the beach, tucked on the side of a dormant volcano, or nestled in a tropical rainforest all sound intriguing, no?
However, some of Hawaiʻi’s environments come with some other considerations, ones you might not have dealt with in your current location, including:
Finally, Hawaiʻi is one of 14 states in which home inspectors do not need to be licensed. As a result, you’ll want to pick your inspector carefully. Understand the experience and background that qualify your home inspector for their role. Ideally, get a referral from a professional you trust.
Additionally, it’s worth trying to be there in person to go over the report with the inspector. That way, you can truly understand any challenges or problems they find.
Finally, make sure you get a termite/pest inspection during the due diligence phase. Pests can be a real problem in Hawaiʻi, and you don’t want to be caught unaware.
Next, we’ve got a couple of tips to help you position yourself for an easy, fun, and successful home-buying experience.