All Forum Posts by: Bryan Vukelich

Aloha @Sam Booth

I wanted to chime in as you have been getting some misinformation from other members though @Mark Waite provided good advice. Personally, I have and currently work with many investors looking for legal STR's and some of my clients are also looking for opportunities on Maui and Big Island. In the past 40 days, I've had 2 clients close on STR properties in Waikiki where the numbers looked quite attractive. For O'ahu, it is completely possible to buy a legal nightly rental building and be cash flow positive. Below is some key info it is best you are aware of.

* STR's can legally operate in Waikiki, Turtle Bay, Ko'olina and Makaha if the property is in the hotel/resort district AND the AOAO allows for short term rentals.

* If you need financing, best you work with a local lender that is familiar with STR units. However, most conventional lenders will not finance a unit that does not have a stove/oven. If you are interested in a unit that only has a kitchenette, I do have relationships with lenders who will finance it but the rate is considerably higher. You will need at least a 25% down payment.

* I have a relationship with a highly rated STR property management company. They charge 20% for full service and handle all marketing, cleaning, maintenance and will pay the GET, TAT, and OTAT tax on your behalf.

* GET, TAT, and OTAT taxes are paid by the guest.

* I recently had a client buy a beautiful 2 BR for $715k at Waikiki Sunset. This building was approved for STR's in Bill 41. A quality STR management company thinks it will gross $7-$9k/mo in current market.

* I also had another client buy a STR at Ilikai for $575K. It is expected to gross $4200-$5500/mo in current market.

* In currently market, you can buy a well maintained 1 BR in $550-$650k range and it will likely gross $5-$6k.  To get an idea of units and highly rates, I recommend you visit Alii Beach Rental website.  

* I have clients who live on the mainland but are self managing their property to avoid paying a PM fee.  Obviously this greatly reducing operating expenses. 

* VERY IMPORTANT: The STR market is in a period of uncertainty. Bill 41 is scheduled to go into effect Oct 23rd, 2023. Due to this bill, STR owners are supposed to register their units with the Department of Planning and Permitting (DPP) to obtain a registration number in order to legally operate their STR. At this time, it looks like the DPP will not have the registration process in place by Oct 23rd. There is uncertainty what will happen then. For this reason, I'm advising my clients to wait to buy an STR here until we see how this all plays out - unless they have high risk tolerance.

Happy to answer any questions you have - I am here to serve you.  

Hi @Damequia Montgomery - I agree with @Michael Borger that a great way to start as a beginner is wholesaling.  But unless you get very lucky, best to understand that it is quite challenging to find wholesale opportunities.  But if you are persistent with cold calling, driving for dollars, door knocking, and I also recommend online marketing, you'll eventually come across some opportunities.  And I recommend you spent time on BP discussion boards asking people about their experience regarding wholesaling and YouTube also has some great channels for wholesaling.  I've known quite a few people who have tried it but get burned out quite quickly.  

Also, if you haven't done so already, I recommend you invest a lot of energy learning more about real estate investing via books, BiggerPockets and networking with other investors.   Even though you don't have a lot of money at this time to invest in a property, $18k is still a good start, and through networking, you may be able to find others who will invest with you if you find an attractive opportunity.  

I enjoy talking real estate and helping people achieve their real estate goals - you're welcome to contact me if you think I can be of service to you.

Best, 

@Micah Casey, I will try to get you a correct answer today from the Department of Planning (DPP) but based on what I know, I am quite sure it would be illegal to do any short term rentals with any property that is not within a resort area and which is approved for short term rentals.

If you'd like to try calling the DPP yourself, number is 808 768-8000.  

Just curious if you want to share, what buildings you currently have vacation rentals in?  

Follow up with you once I have more info.  

@Zasha Smith - many thanks for sharing that info.  Aloha 

@Zasha Smith - congrats on such a profitable flip.  Curious if you want to share - who is your hard money lender?  I have one I like but yours beats his rate by about 1%.  Wish you well in your other endeavors.  

@Rob Hilton - I'm a realtor with Hawaii Life on O'ahu. If you'd like a referral to a quality agent in the Kona area who is familiar with the STR, please message me. And just want to clarify, regarding GET and TAT taxes, normally those are paid by the guest.

Wish you well in your search and happy to answer any questions you have.  

@Jacob Rosenkranz - it is difficult to find traditional small multifamily properties on O'ahu.  Fortunately, there are many single family homes that have either attached or detached rental units.  I have clients you have house hacked in the past and are currently doing it now, and it has/is working very well for them.  Have you been to O'ahu before?  Either way, are there areas on the island that you most desire to live?  Depending on your price point, you should be able to find a quality home for you and your family that can also generate rental income.  

Also, I'll message you directly a couple lender referrals.  I also know some contractors that might be of value to you.

If you think I can be of value to you in any way, please never hesitate to contact me - I am here to serve you.  I've been involved with real estate for over 20+ years and genuinely enjoy helping people achieve their real estate goals.  

Aloha 

Hi @Juan M Colome - if you want to share, I'm curious what made it such a negative experience for you?  

@Mohamed Elshehaby - I am a real estate agent on O'ahu and you are welcome to contact me at any time - I'm happy to serve you any way I can.  Thanks @Brandon Vukelich for sharing my name with Mohamed.  

Hi @Kekila Keuma - 

Do all of your siblings want to be cashed out? And how big is the lot size? I ask as there are certain requirements to build an ADU. Personally, due to long term property appreciation of real estate in Hawai'i, I like your idea of trying to find a way to keep the home in the family as long as it is not a financial burden. If your siblings do not need/want the cash, and you were able to build and ADU, you might be surprised what you can get for rental income. Perhaps the rental income could cover the mortgage and expenses and also give you each some monthly income. Or perhaps some siblings are bought out and the rest retain ownership.

And I agree with @Royce Talbo - money can create big problems between family members.  If possible, I highly recommend all the siblings have a direct conversation on what outcome would be best for each of you and then work on formulating a plan of action to get the best results for all of you.  Perhaps some can be

You might also contact an estate planner or probate attorney - they might have a creative solution I am unaware of.  

Happy to answer any questions you have.  If you want to talk to a property manager about potential rental income, I'm happy to give you a referral.  

It's a touch situation - I wish you the best