Complete noob Buying in Hawaii /Better to invest in the Mainland?

[Raj I.]

Please bear with me as this is my very first BP post. I am sure I will commit some cardinal sin in terms of posting something which doesn't belong here., so please guide me the right way with kindness :)

Situation - My income is high enough where I pay 25k-35k a year after my itemized deductions (#blessed, #notdouchy) and I am turning to RE to reduce my tax burden. 

Option #1:

Buy a 279k home in Hawaii with $80k down for a turnkey rental. Expecting $500-700/month after paying property manager, taxes, hoa, etc. I know it's not efficient to put 30% down, but financing in HI is real tight and this seems to be the main option to go with a Mortgage lender.

Main reason for doing this is so that I can go to Hawaii every year and use that as a write off. 

Questions:

1. Please tell me your thoughts on why is this a good/bad idea
2. Do you know a way to get the loan creatively so that I can unlock the 30%? Will 'Loan Seasoning' work?

Idea was that in 20 years this will be a paid-off condo. 

Option #2:

Buy 5 homes in the mainland @100k each and turn them into long-term rentals.

1. Better to use my own $ or go for creative financing from day 1?
2. What would you do if you were a brand new investor and had $ losing ground on a 1% interest rate?

Thank you so much for your time. I am sure you will get wonderful RE Karma with glorious deals and max ROI's :)

[David Faulkner]

If you don't need the immediate cashflow now and you do need the tax write-offs, which sounds like it is the case, then Hawaii makes a lot of sense. Typical long term rental markets (with the exception of maybe coastal CA, which would be another option like Hawaii) will give you higher immediate cash flow on your rentals, but will tend to not appreciate as much or have as high of rate of rental increases as Hawaii. It all comes down to long term supply and demand fundamentals. Hawaii has perfect weather and beaches, so the demand to live there is high ... on the other hand, it is an island, so the supply is limited. That is primarily why prices are the way they are and tend to rise over time at a higher clip than say the midwest where demand is lower and supply is higher ... the trade of is that Hawaii will not cash flow as well on day 1, but in your situation this does not seem to be the driving factor ...