My alternative to Rail in Honolulu

I have a couple ideas that I think would be a great alternative to rail or any other changes to the traffic problem. Since the city is collecting millions of dollars with the extra 0.5% GET for rail, why not use that money in these ways that would greatly reduce traffic and save our city billions of dollars by not building rail or new freeways.

Here are my ideas, and the dollar amounts are just for examples:

• Give companies $50k (or so) per employee that they move to an office in Kapolei.
• Companies with more than 10 employees could be paid to move their company to Kapolei.
• Give companies $50k (or so) per employee to change that employee's schedule to 10am-8pm, or night shift, or swing shift. There are many employees doing things that don't need to be done 8am-5pm.
• Give companies $50k per employee to make all their employees work 4 days instead of 5, and have some people work Tues-Sat instead. Also they work earlier and stay later, to reduce traffic. Some people could work Wed-Sun.
• If we switch a lot of government offices and services to Wed-Sun work week or have them open at night, then the city would also become more productive in that people would not have to take work off in order to go to the city hall, or DMV or the DPP or DLNR, or wherever they have to go.

Of course we would have to have a way to track that these changes were actually happening, and we would pay them per month or in the form of tax credits, and of course they have to keep doing it indefinitely to keep receeving the money.

What do you think? Could these ideas work?

Increase your Hawaii Home Value with Solar Power!

This month I will be adding a new service for my real estate clients - Solar Power!

Hawaii is in one of the Earth's best locations for generating solar power, and the State of Hawaii offers the nation's best tax credits! Just for adding a solar water heater, the State will give you 35% tax credits for a total of about $2500, and until the end of 2008, there is also a Federal tax credit of 30% that maxes out at $2000.

These are tax credits remember, not just write offs. It's cash back to you as long as you have enough tax obligations to wipe out!

Solar water heaters can save a family over $100/month, and with the total cost of a new 80 gallon water heater around $7000, the math makes total sense. After the $4500 in tax credits, you also can get $1000 rebate from Hawaiian Electric, so your out of pocket cost is only $1500!

So anybody that doesn't have solar water in Hawaii better call me and get it done! If you don't have the $7k to pay up front, then I have another great option for you!

Through the new Solar Power division of Aloha Tony Properties, Inc., I can get your solar power setup for free and you pay just $37 month, with no setup fees, no up front cost! For $37/month I'll give you unlimited solar water heating, as much as the sun will provide you through my 80 gallon tank, that I WILL PAY FOR!


Now for those who are very ambitious - you can get photovoltaic power, actual electricity from the sun, not just hot water, for about $17k. The tax credits still apply, only the Hawaii state will give you up to $5000 in credits.

Some big sales in Oahu this month

There have been some very large sales in Oahu recently. The $12.6million home on Noelo st is in escrow, and the home listed for $10.75 million on Diamond Head road just closed for $9.5million all cash.

On a bit smaller scale, I just closed a $1.7million condo in downtown, and a couple million in other transactions too, for about $3.5million in total transactions in the last 30 days.

Recession? What recession!?

New Tax law will effect thousands of Hawaii rental property owners

There is much discussion about a change to the tax code that will effect owners of rental property everywhere.

Obligatory Disclaimer - I am not a CPA or tax advisor, please speak to a licensed tax advisor with all tax issues.

The new law effective this year will apparently take away a rental property owner's ability to move into a rental home or condo and then live in it for 2 years to avoid all capital gains tax. Until this year, this method of avoiding taxes was a huge benefit to rental owners.

They would use a 1031 exchange to sell a rental and buy a new property that planned to live in someday. The property would remain a rental for two years or more before the owner would then move in. Then since they lived in the house for more than 2 years, they could sell it basically tax free, at least avoiding tax on the first $250k per person, $500k for married couples.

Well the new tax sounds like it's going to prorate the amount of tax you can avoid. So even if you live in the house for 2 years, if it was a rental for 2 years before that, you can only avoid half the tax. I'm not exactly clear on all the details, but this is what I know so far.

Bottom line for rental property owners is that if they are planning to sell a property that was formerly a rental, this is probably the year to do it to avoid some taxes. Also when buying a rental in the future, you have to keep this in mind, because it will be more difficult to avoid taxes even if you live in it.

I'm not sure if this will effect the rental market in Hawaii at all, since many people just keep exchanging properties until they are ready to finally buy the one they want to retire in and then never sell that one. It still works fine as long as you don't sell the property outright in the end. At least this is my understanding.