Buying a House in Hawaii from the Mainland

If you are considering buying a house in Hawaii from the mainland, there are a few things you need to know first.

Keep reading for 5 things you need to be aware of before buying a property in Hawaii from the mainland.

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buying a house in hawaii from the mainland

1. Fee Simple vs. Leasehold

There are two types of property ownership: fee simple and leasehold. If you currently own property on the mainland, it is almost certain that you were a fee simple buyer. Fee simple ownership means you own the property, including the land it is on. When you are given the title for the property, it includes the structure, the land, and any improvements made to the land or structure in perpetuity. You as the owner have the right to use, possess, and dispose of the land in any way you wish (within the bounds of a local HOA and local laws).

In Hawaii, there are some properties that are sold as leasehold. Much of the land on the islands is owned by either the State of Hawaii or the Federal Government. Some of this land is leased out to homeowners, called a leasehold. In this scenario, residents own the structure (house), but lease the land from the government. Buying property with a leasehold requires a full understanding of the conditions, as they are totally different from fee simple ownership.

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The conditions of the lease will likely include stipulations about how the land can be used and for how long. If the homeowner would like to sell before that period of time is over, the new owner will be subject to the current land lease agreement. At the end of the predetermined period, the land will be returned to the lessor (the government), and in some cases this includes the buildings and improvements on the land.

When buying a house in Hawaii from the mainland, be aware of prices that are far below market value as they may indicate a lease that is about to end and will need to be renegotiated.

2. Mortgage Funding from Mainland Banks vs. Local Banks

Hawaii is a Good Funds State, which means all funds have to be in the hands of the title company before closing on the sale. Mainland banks often have the policy of not wiring funds until closing day, which can cause delays because a Hawaii bank will have to wait up to five business days to receive the funds.

Working with a local bank will allow the process to be streamlined, with funds in the title company's account at least two days before closing to ensure a seamless process.

3. Lava Zones

Something you likely haven't taken into consideration when shopping for real estate on the mainland is lava. When buying a house in Hawaii, however, you need to find out whether the property is in a lava zone. Check out the Lava Zones Table to find out if the area you are considering is at risk, and determine what level of risk you are comfortable with.

4. Square Footage Expectations

Moving from the mainland to Hawaii, many people overestimate the amount of square footage they need, or want. With a climate as perfect as ours, locals live outside. We dine and entertain on our lanais, we spend our weekends at the beach or on a hike, and all year round we have the whole island to enjoy.

You are not likely to find a large home within your price range, unless you have a substantial budget, but this doesn't mean you won't be able to have the lifestyle you want with a smaller house. As you think about buying a house in Hawaii from the mainland, keep in mind that your lifestyle will likely shift to include way more time outside than it does right now.

5. How Elevation Affects Energy Costs

One of the major differences between vacationing in Hawaii and living here is energy costs. That hotel air conditioning didn't factor into your vacation budget at all, but energy costs as a resident are substantial. Buying a house with the right airflow will allow you maximize on the tropical breeze and minimize your energy costs, but this requires the right elevation and orientation of doors and windows.

Keep these factors in mind when buying a house in Hawaii from the mainland, especially if you are considering buying something sight unseen. Ask your agent to tell you about the airflow and elevation of the home. Homes at a higher elevation in Hawaii are often priced higher, but this cost is generally balanced by the decrease in energy costs to cool the home.

To learn more about buying a house in Hawaii from the mainland, contact us anytime. We have the team you need to make your plans a reality.

185 Properties
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300 Wai Nani Way #II311 Honolulu,  HI 96815
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Condo: Liliuokalani Gardens
1
Beds
1
Baths
620
Sq.Ft.
1984
Year Built
2
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Unit is located in the King Tower in a lush, tropical setting complete with a winding koi pond. Amenities include a large pool, whirlpool, 5 barbecue and picnic areas, tennis courts, personal...
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2F11/2
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1,207
Sq.Ft.
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Welcome to your dream home in the Northpark community, newly built home in 2022. This excellent condition, detached single family gem offers the perfect blend of modern luxury and island living. As...
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91-1319 Keoneula Boulevard #1102 Ewa Beach,  HI 96706
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2009
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Resort living at its finest! Gorgeous move in ready townhome in the award-winning luxury resort community of Ka Makana at Hoakalei. This townhome shows pride of home ownership with upgraded tile work...
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2
Beds
2
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2018
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2
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Highly popular 45-story, glass, and concrete high-rise Kapiolani Residence condo, completed in Dec. 2018. Prime Location nearby Ala Moana Shopping Center, Ala Moana Beach, Don Quijote, Convention...
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Experience the magic of Maui sunsets at 1815 Halama Street in Kihei. Situated just a stone's throw away from the vibrant Kalama Park. In addition to beach access, the 36-acre park is home to a...
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409 Iolani Avenue #402 Honolulu,  HI 96813
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Condo: Kaneda Courts
2
Beds
1
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644
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1971
Year Built
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Aloha, welcome to convenient condo living in town. This boutique condo offers a desirable location with easy access to essential amenities, hospitals, and cultural attractions. The proximity to...
2
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1
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645
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1969
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Great Location, conveniently located near downtown Honolulu, within walking distance to schools-elementary and middle school, 14 minutes to Ala Moana Shopping Center, near Costco Iwilei, Best Buy,...
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91-643 Kilipoe Street Ewa Beach,  HI 96706
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Neighborhood: Ewa Beach
5
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1971
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NEWLY REMODELED! Spacious 5 bed and 4 bath Single Family Home with modern finishes and no HOA fees. Open floor plan featuring quartz counter tops, stainless steel appliances and 2 separate living...
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1515 Nuuanu Avenue #1950 Honolulu,  HI 96817
$425,000
Condo: Queen Emma Gardens
2
Beds
1
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711
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1963
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2
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Conveniently located close to Downtown, Safeway, Longs Drugs with easy access to freeway. Assigned Tandem parking stalls. Amenities include a large recreation area, 2 tea houses, BBQ areas, swimming...
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Experience the breathtaking ocean, city & Diamond head views from this highly desired "01" corner unit in the new, SOLD OUT Sky Ala Moana West! This residence features sophisticated Bosch™...
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Neighborhood: Ewa Beach
4
Beds
2F21/2
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1,595
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1965
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Discover island living in this meticulously remodeled 4-bedroom single-family home oasis, moments from the ocean's embrace. This eco-friendly property features a net metering photovoltaic system with...
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1212 Nuuanu Avenue #3203 Honolulu,  HI 96817
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Condo: Honolulu Park Place
2
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Take in extraordinary views from a recently refreshed high floor condominium at Honolulu Park Place. Entertain friends & family from your own deep set lanai, or one of the many amenity spaces...

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