Short Term Rental in Honolulu, HI

[Choon Yee Dee]

Investment Info:

Condo buy & hold investment.

Purchase price: $282,000
Cash invested: $120,000

STR buy and hold with renovation for value add.

What made you interested in investing in this type of deal?

My partner and I found that cashflow is the strategy that we are currently looking to acquire and Honolulu, HI has a very high occupancy rate. My partner grew up in Honolulu, HI so she knew the area and how tourism drives the city there.

How did you find this deal and how did you negotiate it?

We found this deal just simply on Redfin. We were in contact with a Redfin agent who also has a STR in the same building and gave us addresses that allows STR in Honolulu. Not all buildings allow STR due to regulations. In terms of negotiating the deal, we looked at the property and its condition and negotiated the price down and eventually met in the middle.

How did you finance this deal?

We financed this deal through a local lender in Hawaii with a 1/1 ARM at 8.875%.

How did you add value to the deal?

We added value to this deal by renovating the entire 257 square footage condo. From walk in shower, tiles on shower walls, tiles on bathroom floors, new LVP flooring in living area, new paint, and among other littler things.

What was the outcome?

The outcome of the renovation was amazing! The contractor we hired renovated several other units in the same building and did a beautiful job.

Lessons learned? Challenges?

There were many challenges that came about after the inspection; from outlets that were not up to code, possible water leaks above the shower head in the ceiling, water pipes from bathroom vanity was the same as kitchen sink with no shutoffs, etc. The biggest lesson learned here is that there are going to be mistakes made or problems that come up, and so having patience and communication thoroughly with your partner and team are key to getting through the process.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I would recommend Tyler Hinderer (real estate agent) in Honolulu, HI area. He was very patient with us as first time real estate investors and went to bat for many different properties for us. He walked us through the entire purchasing process, as it was very new to us.