Hawaii Tips

	Shannon Feliciano Jr
	94-1024 Waipio Uka St Suite#206 Waipahu, Hawaii 96797 Cell: 808-284-0617 Office: 808-447-3629 Website: www.ShannonFelicianoJrRealtor.com	  Tweet

Hawaii has a unique and diverse real estate market and is far different from any other market in the United States. Finding what you can get for your money in Hawaii will surprise you, from multi-million dollar beach front properties to growing family oriented neighborhoods. The state of Hawaii is made up of eight main islands called Ni’ihau, Kaua’i, Oahu, Maui, Moloka’i, Lana’i, Kahoolawe, and the Big Island. Oahu is the most sought after island to buy real estate due to its city like atmosphere and master planned communities. Here in the islands you can find a home for almost any type of buyer. Hawaii is perfect for people looking to retire and relax in our year round tropical weather, or for first time home buyers looking to start a family in the up and coming master-planned communities. Below are tips that every home buyer needs to know before purchasing a home:

1. The City of Honolulu which is located on the Island of Oahu has a vibrant real estate market. The Island of Oahu has a huge inventory of homes. The average median home price paid for homes on the island in 2011 was $570,000 compared to $590,000 in 2005. This 4.2% decrease over six years is an indicator that Hawaii’s home values were not affected by the economic downturn. Housing inventory in downtown Honolulu has a high supply and demand for high rise condominiums. On the Leeward side of the island you will find huge master planned developments with newer modern homes. Located in Kapolei these developments offer first time homebuyers a chance to get more home for the money. These developments start at $350,000 and buyers are sure to find a great deal because many developers offer special financing options.

 

On the East side of the island there is a huge high end market which has attracted many international buyers from Japan, China, and Korea. Areas like Hawaii Kai, Kahala, Portlock offer multi-million dollar estates.  The average home prices in this area range from $1,000,000 to a recent sale in Kahala for $22,000,000. The Hawaii Kai Region sold a total of 195 homes in 2010 compared to 175 sold properties in 2009 which is an 11% increase within just a year.

 

On the North side of the island you will find older plantation towns such as Waialua, Haleiwa, Kahuku, Laie. These neighborhoods offer older style homes built in the early 1930`s which attract buyers with the ability to rebuild or renovate. These properties are mostly bought for their huge acres of land for farming and raising live stock. The average price paid for homes on the North Shore in 2010 was $625,000 down 10% from $697,500 in 2009. Home sales have risen here from 65 sold properties to 83 sold properties in 2010, a 28% increase. This is an indicator that the market here is stabilizing and demand for real estate here still remains high.

2. Purchasing beach front home properties can be tricky and the salt water can cause huge damages to wooden built home. Buying a concrete built home is key when buying beach front homes here in Hawaii. Also, it is important to get a shoreline survey. Hawaii zoning codes require a home to be 40 ft inland from the certified shoreline. I have seen some beach front homes that are were not correctly surveyed before being built and owners having to move the home back to meet the 40 ft rule. This can prevent you from getting future permits on the home as well as fines from State of Hawaii.

3. When purchasing a home with an owner builder permit, keep in mind that the home cannot be sold or leased for 1 year from the date permit is closed. If you sell or lease a home before that 1 year you can be fined for the first offense $5,000 or 40% of the appraised value of the building. Owner builder permits allow an owner to obtain a permit and exempts an owner from the requirements to be as a licensed contractor. Keep in mind the work still has to be done by a licensed plumber, electrician, etc.

4. Get pre-approved by a lender so you know how much you can afford and will not waste time looking at home beyond your reach. Shop for a loan and get quotes from at least 3 different lenders. You will be surprised on how different each lenders  are. By doing this, you are able to get the best rates and terms for your circumstances and you can make a well informed decision.

5. Know your financing options! Loans like USDA rural loans can help you obtain 100% financing. I have recommended this loan program to many buyers because it requires little or no reserves, no owner occupancy ratio, flexible FICO scores, no mortgage insurance, and the seller can contribute  up to 6% of the closing costs.  The only drawback is that to qualify for this loan, the home has to be located in a rural area. Contact your loan officer or realtor to see if the area you are looking to purchase a home qualifies for this unique loan program.

6. Choosing a Real Estate Professional is highly recommended.  It is to the buyer’s benefit to interview a couple of different Realtor`s who specialize in the City or neighborhood they are looking to purchase. Find a Realtor who holds the Accredited Buyers Representative (ABR) or other designations. With these designations it shows that this Realtor has taken the extra time and effort to get educated on how to better serve and represent their clients. Look for a Realtor who has market knowledge of the area you are looking to buy. A good Realtor will not only tell you about features on a particular home but will also give information on the neighborhood. For example, he/she would be able to provide you with knowledge of any up and coming developments that would benefit you and your family, closest schools, recreation centers, parks, traffic situation, and future plans of the community if it is in pre-development stages. Also, ask to speak with past clients they have assisted or ask for customer testimonials to see how other clients have felt about being represented by this particular realtor. This will assure you that your Realtor will work hard for you and will represent your best interest.

7. When purchasing a bank owned property (termed an REO) in Hawaii, it is imperative to check the title on the home to see if it is free and clear of any liens issued by any agency such as community association, City and County, State, etc. This can lead to huge unwanted costs for you the buyer to assume. Hawaii law requires the seller or buyer to pay all delinquent maintenance fees up to $3,600.00 or not more than 6 months of the maintenance or association fees if a home is acquired through foreclosure.

8. If you are considering purchasing a foreclosure or distressed home make sure that the home is in full compliance with City and State regulations. If you are obtaining government financing the home will have to be built to code and be in livable condition. Not doing your homework on condition and unpermitted homes can cost you a lot of money and wasted time. This usually comes into play when your lender does an appraisal on the home to get the value for your loan. This can lead to many problems if the permit does not match the tax records. You can find more of this information by going to the City and County of Honolulu building permit department or hiring a licensed contractor to take a look at the home. If you are looking to purchase a home which looks like it has added rooms or building extensions, I would suggest you do the extra homework to make sure all codes are met before making an offer.

9. Get a termite inspection done! Due to Hawaii`s tropical weather Hawaii homes are very susceptible to termites. There are two types of termites to watch out for: the dry wood termites and the subterranean termite.  The subterranean termite is known to live and create nest under the homes. They cause major structural issues and repair cost can be huge. So getting a sentricon termite system is highly recommended and it is highly advised to look for this in ground system before purchasing a home to give you assurance.

 

The diversity of Hawaii’s real estate market is what makes it such a great place to purchase a home. As mentioned above you can pretty much find a home that will fit you and your families need.

 

 

 

 

 

 

 

(Information Herein Deemed reliable but not guaranteed)

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