May 2009

Found 25 blog entries for May 2009.

You want to run a B&B in Hawaii. Well, so do lots of other people, and it may soon get easier to buy real estate in Kailua that allows for a B&B.  The controversy over bed-and-breakfast operations on Oahu has resulted in measures that could increase the number of such accommodations but impose new requirements.

The City Planning Commission wants to 1) lift the ban on new bed-and-breakfast homes and 2) limit them to residential neighborhoods and 3) required more information about them in advertisements.

Some Kailua residents don't like B&B's because of problems with parking, too many guests, loud parties, late-night arrivals. But one amendment calls for the repeal of the present B&B law, allowing them in residential neighborhoods under a conditional use

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This week I've been looking with a client at luxury condos in and around Waikiki with a great ocean views. So after a couple days of looking at listings, I thought I would post some of my best findings and explain a bit about these buildings.

First of all, the true luxury condo market begins at about $1.2million in Oahu. And most of these properties are right in Waikiki, Ala Moana, or Kakaako. There are also some nice ones in Diamond Head which are more expensive but those seem to be dropping fast.  And it's important to understand that there's a big difference between ocean view and ocean front. If you want ocean front over about 1500ft, it's going to nearly double the price of a luxury condo, to around $2-4million.

Some of these units have an elevator

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If you live here in Oahu, you've probably driven right past Paiko Lagoon without ever noticing it. Even though it's just one turn off of Kalanianaole Hwy, it's a sort of secret spot. With fantastic ocean front homes, a sandy beach, and nice calm water, it may be the best kept secret in the Hawaii Kai area. I say "area" because it's not quite in Hawaii Kai, but actually considered part of the Diamond Head region in the Honolulu MLS.

This is kind of unfortunate, because Diamond Head makes people think of something very specific, something very not Paiko Lagoon. Paiko is a lot more like the Portlock area in that the shoreline is flat with small sandy or rocky beaches, and no waves at the shore. There are nice waves about a half mile out though. The water

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For many it sounds like a dream, owning a home in Hawaii, but the cycle of the Hawaii real estate market can drive people crazy. If you've been watching the Hawaii real estate market long enough, you know about the "Japanese bubble" and the foreclosure market of the 90's. Go back even farther and you can see the impact of the two world wars.

While no one can know the future of the market in Hawaii's real estate, looking at the past can teach us many lessons.  I frequently run into homeowners who have been in the same house for 30+ years who understand this. They tell me about buying the house for $50,000 in 1968.

Those same owners are now sitting on properties worth $800,000 or more. As I meet owners around Hawaii Kai, I'm often amazed at how long they have…
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I saw an article in the Star regarding the drop in number of Hawaii Realtors in 2009. The article highlights the total number of Hawaii real estate agents that haven't renewed their licenses this year, but that's not what I love about it.

Sure, "the Hawaii Real Estate Commission saw a 21 percent decline in license renewals this year," but that's no big deal.

The part I love is this - "Of all Honolulu board Realtors, 44 percent made no sales, and  18 percent made only one sale last year. "

That is amazing. I guess these are part timers or people who just have their Hawaii real estate license just in case. But I can't imagine trusting a part timer with the most important financial decision of your life - your home sale.  So about 64% of the Realtors on

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Why should you buy a house in Oahu rather than Maui, Kauai, or the Big Island?  People often tell me they are thinking about moving to Hawaii but aren't sure which island to choose. They probably don't realize that the differences are huge.  I have 10 reasons to choose Oahu below, though I can think of a lot more.

1 Oahu has the best health care. If you live on the outer islands and have a serious health problem or emergency, they will fly you to Oahu, during which time you may die. Serious.
2 The outer islands are slooooooow. Everything is slow. Cars are slow, people are slow. Change is slow. It will drive you nuts. Unless of course, you like slow.
3 The traffic in Kauai is crazy. Yes, it's worse than Oahu. If you want to get from Liue to Kapaa or even

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The end of May means schools get out, vacations start, and people start buying houses in Hawaii. It's
probably the same in every state, but particularly in Hawaii, summer means the beginning of the tourist season and also the high season for home buyers and sellers.

Each May and June hundreds of homes are listed as people are hoping to make their move or pocket their profits while most of the buyers are out and about. Sometimes tourists visiting Hawaii will buy something if they've been here a lot and they plan to be here more, but usually it's just local Hawaiian people moving around and job transfers from the mainland.

One other factor is that the military makes a big shift in personel in the summer. Hundreds of military families will come from all over…
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7 Reasons you shouldn't buy Hawaii real estate right now

- you like to paying the $2400 average rent in Hawaii
- you don't need a tax write off
- you like to move every couple years, whenever your landlord feels like you should
- you are flat broke
- you are a hippie, living on the beach in a tent
- you don't plan to stay in Hawaii
- real estate is risky, unlike the stock market has been.

 

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It's happened to me too many times to count now. When buyers come to Hawaii from the mainland, they often want to use the lender they are familiar with from their home state. Some want to use a lender they found on the internet.

Nearly every time I have worked with a lender from mainland, something has gone wrong. The last time was a purchase of $775k in Kaneohe, a beautiful tropical retreat purchased by a great young couple from the mainland. Their lender, who happened to be from New York and worked for a big lender, delayed the escrow by 2 weeks. Then he proceeded to yell and curse at my escrow officer here in Hawaii. Why?

Because the lender didn't know that Hawaii recordings in Land Court require full names, not middle initials. The lender sent over

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I have several clients interested in short sales and some listings that are short sales - all take a long long time. It's been 4 months with one listing  with no end in sight yet. Short sales are slow because lenders are a) backed up with massive numbers of short sales, and b) not in a hurry to lose money.

While short sales are a great way to get a good deal, another tactic is to go to another listing that is not a short sale, inform them of your offer price on the short sale and see if the seller will accept the same or similar price. Once in a while this may work for you, even if you have to pay a little bit more money. The benefit of course is you get to close when you want to.

The longest I have heard of a short sale going in Honolulu is 13 months.

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