ROI for Kihei short term rental/ occupancy rates/electric bills?

[Kaylea H.]

Hi there,

my husband and I have family that live in Maui, and we are considering purchasing a short term rental in the next few years to offset the cost of going to visit.

We are probably shopping in the 2 bed/2 bath w/o ocean view market. From what I could tell after spending time on forums and VRBO-type sites, it doesn't seem unreasonable to assume we could charge $120 a night (more during peak season) and keep a 60% occupancy rate (year round average).

What I'm trying to determine is what kind of down-payment we need to break even. I know it has to be at least 30% to get a loan, and I don't think we could really do much more than that.

What I'm hoping is that someone who has rentals in Maui (w/o ocean views) will tell us it is reasonable to charge closer to $150 during slow times (more at peak) and expect an 80% occupancy rate, but I'm guessing that's not the case. (I'm specifying non-ocean views because I believe those will be the only ones in our budget). My husband remodels homes, so we can do the work to update a unit and make it look appealing if the ones in our price point need some spiffing up.

Also, what's your experience with electric bills for 2 bed 2 bath units?

Have you found reasonable rental agency fees? I've heard that low-high is 20-40% (OUCH), does this seem accurate? We definitely would want to hire out an agency rather than try to book things ourselves. I realize this is a big drain on income.

Most importantly, do any of ya'll break even without a massive (over 30%) down payment?

Do any of you notice a difference in occupancy rates between 1 bed and 2 bed units? We would prefer a 2 bed unit so more of us can visit at the same time, but if 1 bedroom units are easier to rent we would consider that option. I noticed HOA fees are significantly less when you reduce square footage?

Any other tid-bits you think a newbie ought to know?

Thanks you guys, I really appreciate any insight!