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  • Buying an Oahu Condo for visits and rental?

    My aunt is a real estate agent on the mainland and she suggested that maybe I could purchase a condo on Oahu to stay in every once in the while over the next few years before I move there and purchase a home. That way I can make sure that I like it there and have a place to stay. When I am not there I can rent it out to vacationers on a weekly or daily basis. When I am ready to move there in 3-5 years from now, I can sell it for a small profit or at least break even or even keep it if the cash flow is positive.

    My question is, are there places on Oahu where tourists or other visitors might actually rent my apartment often enough that it might just break even with the mortgage? I don't mind if I have to pay more or decorate more beautifully to help ensure success. I also don't care where on the island that it is located, i.e., if the tourist prefer remote isolated beaches as opposed to downtown Honolulu, or if it is more easy to rent out a downtown condo, then I would do that.

    My budget is not that high, maybe only between $350,000 to US$500,000. That might rule out some of the really nice new places. I forgot to mention that I don't care how small it is, but it must have two bedrooms, one for my kids and one for my wife and I. The budget doesn't include the interior decoration, I can have a separate budget for improvements to the property.

    Any ideas and help would be appreciated, mostly I just worry that most tourists either stay in hotels and/or only visit other islands?

  • #2
    Re: Buying an Oahu Condo for visits and rental?

    With that type of funding you should have no problem finding a condo to bye in Oahu. You should find a management property company to assist you with managing the condo locally and take care of all rental and management.

    I don't live in Hawai'i but I will say that anything close to the beaches or town will be a good area for rental. Visit this site, http://www.cbpacific.com

    I am sure more locals will come in once everything is getting back to normal to answer your question.

    Good luck!
    Tayo

    FINALLY HOME IN HAWAI'I!

    "Twenty years from now you will be more disappointed by the things you didn't do than by the ones you did do. So throw off the bowlines. Sail away from the safe harbor. Catch the trade winds in your sails. Explore. Dream. Discover."
    Mark Twain

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    • #3
      Re: Buying an Oahu Condo for visits and rental?

      Thanks for your post Queenolu. I am most concerned with picking the right condo that tourists and/or locals alike will want to rent on a weekly basis. I checked some real estate websites and looks like some buildings around the island on the ocean can be found for that price, I just want to be sure that some tourists or someone else will stay there if it is nice etc., or when tourists come to Oahu they either rent a villa on the beach or stay in a hotel. None go for oceanfront 2 BR condos.

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      • #4
        Re: Buying an Oahu Condo for visits and rental?

        Originally posted by Queenolu View Post
        I don't live in Hawai'i but I will say that anything close to the beaches or town will be a good area for rental.

        Not necessarily. You just can't buy something here and think you're going to rent it out as a vacation rental when you're not here. Vacation rentals are supposed to be properly licensed.

        This has become an enormous problem in Kailua, Lanikai, Waimanalo, and parts of the North Shore. Neighbor islands have been impacted too. Many of these illegal rentals are owned by mainland investors who have bought multiple properties expressly for use as vacation rentals. Since the laws were so seldom enforced in the past they had pretty clear sailing. Not so easy anymore. People are getting fed up with having residential areas turned into transient resorts.

        On Oahu the law is finally beginning to be enforced:

        http://starbulletin.com/2006/06/16/news/story05.html

        http://starbulletin.com/2006/08/31/news/story05.html

        No vacation rental permits have been granted since the 1980's on Oahu and it is very unlikely that this will change.

        So no, "anything close to the beaches" is not necessarily a "good area for a rental."

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        • #5
          Re: Buying an Oahu Condo for visits and rental?

          Originally posted by WindwardOahuRN View Post
          Not necessarily. You just can't buy something here and think you're going to rent it out as a vacation rental when you're not here. Vacation rentals are supposed to be properly licensed.
          I bet that this also has something to do with the big hotels wanting to keep occupancy rates high. Wow, that sucks. Thanks for the heads up.

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          • #6
            Re: Buying an Oahu Condo for visits and rental?

            Originally posted by Hobart View Post
            I bet that this also has something to do with the big hotels wanting to keep occupancy rates high. Wow, that sucks. Thanks for the heads up.
            Actually it has more to do with not diminishing the quality of life for full time residents.
            “First we fought the preliminary round for the k***s and now we’re gonna fight the main event for the n*****s."
            http://hollywoodbitchslap.com/review...=416&printer=1

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            • #7
              Re: Buying an Oahu Condo for visits and rental?

              Originally posted by Hobart View Post
              I bet that this also has something to do with the big hotels wanting to keep occupancy rates high. Wow, that sucks. Thanks for the heads up.

              The "oh it's a ploy by the big hotels to keep up occupancy" is a rallying cry of the illegal rental owners. So is the "gee, this is just a mom-and-pop business that allows the poor and elderly to be able to keep their homes by renting out a little room to travellers." Yeah, right.

              http://www.usatoday.com/travel/hotel...-rentals_x.htm

              And no, the fact that the laws that are already in place are being enforced does not "suck," except for those who have knowingly broken the law. Too bad.

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              • #8
                Re: Buying an Oahu Condo for visits and rental?

                I guess I do need to think of it in terms of the neighbors. If I lived across the hall or next door, I wouldn't like it either. Its to bad for me because now I might not purchase this property, so I suppose it might not be that great for the real estate market. There must be loads of condos on the market now that were once tourist rentals. Going to glut the market and hurt other home owner values.

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                • #9
                  Re: Buying an Oahu Condo for visits and rental?

                  Originally posted by Hobart View Post
                  I guess I do need to think of it in terms of the neighbors. If I lived across the hall or next door, I wouldn't like it either. Its to bad for me because now I might not purchase this property, so I suppose it might not be that great for the real estate market. There must be loads of condos on the market now that were once tourist rentals. Going to glut the market and hurt other home owner values.
                  Maui has a better market for condo investors. If you buy a condo at one of the timeshare places in Kihei, you can rent it out, no problem. On Maui where you would run into the neighbor issue is if you bought a standalone house and turned it into a B&B or something like that. Then you'd have to get a permit. But even Maui County is trying to add surcharges to any non-owner occupied dwellings because of the lack of affordable housing for the people who live there full time.

                  Miulang
                  "Americans believe in three freedoms. Freedom of speech; freedom of religion; and the freedom to deny the other two to folks they don`t like.” --Mark Twain

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                  • #10
                    Re: Buying an Oahu Condo for visits and rental?

                    Originally posted by Hobart View Post
                    I guess I do need to think of it in terms of the neighbors. If I lived across the hall or next door, I wouldn't like it either. Its to bad for me because now I might not purchase this property, so I suppose it might not be that great for the real estate market. There must be loads of condos on the market now that were once tourist rentals. Going to glut the market and hurt other home owner values.
                    Certain areas are zoned for short-term rentals. Waikiki is one of them. Many buildings in the Waikiki area allow vacation rentals.

                    Where you get into trouble is in the residential-zoned areas of the islands.

                    And the RE market is pretty strong here. I doubt if the failure of one person to purchase a condo is going to come as a crushing blow.

                    A little website that explains in more detail, including how to check whether a property is legally allowed to be rented as a short-term vacation rental:

                    http://www.bnbcoalition.org/

                    If you want to purchase a property and rent it out on a short-term basis as a vacation rental just make sure that it is legally permitted to be rented as such.

                    Don't take a RE person's word for it, either. I've heard that RE people are telling potential buyers that it is just fine and dandy to rent their nice Kailua beachside property on a short-term basis when in fact the property is not a permitted short-term rental.

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                    • #11
                      Re: Buying an Oahu Condo for visits and rental?

                      Originally posted by Hobart View Post
                      Its to bad for me because now I might not purchase this property
                      Well, look at it this way: now you can go back to buying that airplane and yacht and helicopter that you talked about at this link.
                      .
                      .

                      That's my story, and I'm sticking to it.

                      Comment


                      • #12
                        Re: Buying an Oahu Condo for visits and rental?

                        Originally posted by Hobart View Post
                        Its to bad for me because now I might not purchase this property, so I suppose it might not be that great for the real estate market.
                        Well, maybe it's bad news if you were a realtor. Some could see it as good news that another vacation rental failed to materialize.

                        Why not buy and make it a legitimate rental unit? Demand is high there, too. You'd have to give tenants a lot of warning before coming over for your vacation, but I have a weird feeling you still won't have problems finding renters willing to live with short-term leases.
                        There must be loads of condos on the market now that were once tourist rentals. Going to glut the market and hurt other home owner values.
                        Much as everyone's hoping for the bubble to pop, apart from a bit of cooling, I don't expect home values to be "hurt," at least by folks selling off former illegal vacation rentals. Demand still far exceeds supply.

                        Have you considered a time share?

                        Comment


                        • #13
                          Re: Buying an Oahu Condo for visits and rental?

                          Originally posted by Hobart View Post
                          There must be loads of condos on the market now that were once tourist rentals. Going to glut the market and hurt other home owner values.
                          I wouldn't be surprised to see some earthquake-damaged condos in Kona and Waikoloa for sale in a few months. Might be able to pick up some good deals.
                          Ā Ē Ī Ō Ū ā ē ī ō ū -- Just a little something to "cut and paste."

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                          • #14
                            Re: Buying an Oahu Condo for visits and rental?

                            Originally posted by Hobart View Post
                            My question is, are there places on Oahu where tourists or other visitors might actually rent my apartment often enough that it might just break even with the mortgage? I don't mind if I have to pay more or decorate more beautifully to help ensure success. I also don't care where on the island that it is located, i.e., if the tourist prefer remote isolated beaches as opposed to downtown Honolulu, or if it is more easy to rent out a downtown condo, then I would do that.
                            Vacation rentals that are outside of the usual tourist areas (like Waikiki) are not welcomed by the majority of us who live here.
                            Last edited by Keanu; October 17, 2006, 06:18 PM.

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                            • #15
                              Re: Buying an Oahu Condo for visits and rental?

                              Originally posted by Hobart View Post
                              My question is, are there places on Oahu where tourists or other visitors might actually rent my apartment often enough that it might just break even with the mortgage? I don't mind if I have to pay more or decorate more beautifully to help ensure success.

                              With this post and your other fake query about buying helicopters and airplanes, which no intelligent person would ask about on an Internet discussion board, I have the sneaking feeling that you're completely full of crap.

                              But you are hooking a few, so please ... carry on.

                              Comment

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