Hawaii Real Estate

Closing costs depend on a number of factors, including the purchase price, type of property, and location, but there are common costs to expect. Lender fees can include origination, application, and appraisal fees. A title search will be done to verify that the seller has a clear title, and title insurance may be required to protect against any title defects. Escrow is responsible for handling the closing process and ensuring that all documents are signed and funds transferred, so expect fees. Recording fees are charged by the county to record the transfer of ownership. Inspection fees can include home, mold, and termite inspections. If the property is part of an association, you will have pro-rated HOA fees and a pre-payment for the following month.

Median sales prices for condos and homes for sale in Maui vary with several factors having a direct effect on pricing, such as past sales, demand, and inventory. Latest numbers for April 2023: Single-family home prices were $1.145M (down 0.9% from 2022) with an average of 122 days-on-market (up 9.9% from 2022); condo prices were $815K (up 7.2% from 2022) with an average of 109 days-on-market (up 47% from 2022).

Property tax rates in Hawaii vary depending on the county and assessed value of the property. Property taxes are assessed annually based on the value of the property as of January 1st of the tax year, and the tax rate is then applied to the assessed value. Hawaii tax rates are as follows: Hawaii County from 0.61% to 1.36%; Kauai County from 0.30% to 1.08%; Maui County from 0.19% to 1.46%; and Honolulu County from 0.35% to 1.39%. If the property is your principal residence, there is an exemption that provides a tax credit to be applied to the assessed value before the property tax rate is calculated. Read more.

Fee simple - the most common type of ownership in Hawaii, where the property owner owns 100% of the land and any buildings or improvements on it. They have the right to sell, lease, or transfer it.

Leasehold - the owner only owns the right to use the land and any buildings on it for a specific time period, as the land is owned by private landowners or native Hawaiian trusts. In addition to maintenance fees, there is monthly lease rent. When the lease expires, the land and any improvements on it revert back to the landowner, unless the lease is renewed.

The costs of owning a condo in Hawaii depend on a variety of factors, such as location, size, age, and amenities. AOAO fees cover the maintenance of the common areas, such as the pool, landscaping, and security. Property taxes range from 0.19% to 1.5% of the assessed value. Utilities include electricity, gas, cable, phone, and sometimes water. Homeowners insurance covers the interior of the unit, personal belongings, and liability. Owners are responsible for maintaining and repairing the interior, such as appliances, plumbing, and electrical. Overall, the monthly costs of owning a condo in Hawaii can vary from several hundred to thousands.

A 1031 Tax Deferred Exchange allows a property owner to defer paying capital gains tax when selling an investment property by using the proceeds from the sale to purchase another like-kind property. Instead of receiving the proceeds, the owner uses a qualified intermediary to hold the funds. Within 45 days of the sale, the owner must identify a like-kind replacement property, and within 180 days of the sale, the owner must close on the purchase of the replacement property using the funds held by the intermediary. It's important to note that there are strict rules and guidelines to be followed in order to qualify for a 1031 Exchange, and it's recommended to work with a qualified intermediary and tax professional. Read more.

Yes, non-residents can buy real estate in Hawaii. There are no restrictions on foreign ownership of property, and non-residents can purchase and own property just as residents do. They may have a harder time obtaining financing for a property, as some lenders may require a larger down payment or proof of income in the U.S. They may also be subject to different tax rules and rates, so it's important to consult with a tax professional. Off-island owners will need to hire a property manager to manage a rental property.

Maintenance fees of condos in Hawaii typically cover the cost of maintaining and operating the common areas and shared facilities. Property maintenance includes landscaping, pool and spa, building exterior, and repair of common areas such as hallways, elevators, and parking garages. Utilities included are often water, sewer, garbage, and rarely electric. Insurance on the exterior of the building and common areas, but owners will need to purchase a homeowners policy with liability to cover from the walls into the unit. Contribution to the reserve fund to be used to pay for repairs and upgrades to the complex over time.

The length of time it takes to close escrow in Hawaii depends on the complexity of the transaction, responsiveness of parties, and type of financing. For cash offers, expect 21 to 30 days, financed offers will be 45 to 60 days. During escrow, the buyer and seller will work to complete all tasks and documentation, including obtaining inspections, securing financing, and signing legal documents. Once all requirements have been met, escrow will distribute funds and transfer ownership of the property. The escrow company acts as a neutral third party to ensure that all aspects of the transaction are completed accurately and on time.