All Forum Posts by: Mark Waite

@Suvarna G. Keep in mind that appraisals are trailing indicators, going up to six months back. So a lot is going to depend upon the transaction activity either in your complex or nearby.

Sorry you've had a bad experience with your appraiser.Unfortunately, we do have a few appraisers on Maui who seem to think that their opinions are akin to gospel. Rather than look at the reality as it is, they seem to think they have the right make their own market, rather than doing their job of simply appraising the market value of the property. Operative word being market value!

I would say not a warning sign about our market. I've had clients who have had no problems with their property appraising out. So I would attribute your situation to one where you ended up getting an incompetent person, just like in any industry. Maybe consider requesting a second appraisal? Will cost but if its important, then do it. 

The market is tight and likely to remain that way. Too many owners have cheap money loans so don't expect to see a flood of inventory. 

You said you want to buy a holiday home that you can rent out when not using it. If you go the long-term route, you will only be able to use it when the place is vacant as your tenants will have the rights to use the property during the term of the lease. STR properties are a lot easier because you can just block off time on the calendar when you intend to use the property.

As for locations, I agree with @V.G Jason if you go the STR route. Hawaii has year-round tourism. The only thing that changes is that we see a change in the demographics during the summer months, with more families coming over when kids are out of school. For an LTR, it is a lot harder to make the numbers work in today's market. That being said, there is a shortage of housing and always people looking to rent.

Ultimately, it depends on how much you want to spend. There are markets where your $ will go further but you may not see a good ROI.

You won’t be able to charge as much as if you had an ocean view, but your acquisition price is going to be far less as well. I always tell my clients to look at the difference in the nightly rate of comparable ocean view versus a non-ocean view properties. You’ll find the ADR difference is not that great, so you’re going to have to rent a lot of nights to make up for the additional price you’re paying for an ocean view.

As for comments about an HOA, that's part of doing business here. But if you run your numbers, you should have already factored that in to your monthly expenses. It's no different than someone who owns a house and Hass to pay for a lawn service or a pool service. It is just part of doing business.

Quote from @Bonny Drago:

@Kaja Baum actually the property manager came back and said it was 98K .

Don’t put blind faith in Airdna. Their numbers, especially for Maui, are not showing to be accurate.

Look for fee simple properties. They are more competitive as a buyer but you don’t have the leasehold payment each month.

@Bonny Drago leaseholds aren’t ideal but you can occasionally find one that does ok. However, financing, if that is needed, can be a challenge. But you’ve discovered the impact they have on cash flow.

You can do well with fee simple properties .Just be patient snd ready to pounce when you see the right place.

There is a reason why our island is always on the list of top vacation destinations!

Quote from @Frank Barletta:

Quote from @Mark Waite:

Quote from @Frank Barletta:

While I don't have rentals in Maui, I do spend time in Hawaii annually to visit family, and can tell you the STR market was hit hard by the governor who recently created legislation to prohibit STRs under 30 days which really hurts the market.

No, this is completely incorrect. Each island manages their STRs differently. And the STR has not been hit hard. I’m doing very well with mine.

The island of Oahu is definitely in this position. I would personally be cautious for Maui as there is no guarantee regulation will not come. 

Again, get your facts straight. The island of Oahu is not 100% in that position. There are areas where nightly STRs are allowed, they county hast just tightened it up significantly.
There is a reason why Maui is continuously selected as one of the best markets for STR investments, and why even today there is a strong buying activity.
So please, educate yourself on this or any other market before you just start throwing information out that is incorrect. I would not be throwing out comments about the STR market in NYC, so please don't do the same in a market you don't know well.

Quote from @Frank Barletta:

While I don't have rentals in Maui, I do spend time in Hawaii annually to visit family, and can tell you the STR market was hit hard by the governor who recently created legislation to prohibit STRs under 30 days which really hurts the market.

No, this is completely incorrect. Each island manages their STRs differently. And the STR has not been hit hard. I’m doing very well with mine.

@Zach Edelman I would exercise great caution as it pertains to Waikiki and any other market on Oahu that is showing up as a great place to invest. For one, the county is continue to pass restrictions to limit in what complexes STR's are allowed. Secondly, consider the fact that there is an extremely high hotel saturation level. You are likely aware of this but everyone should be aware that just because Airdna, Rabbu, etc. show markets as being good investments, they are not taking into account the legal restrictions.

@Heather Gates Not sure where you got your information from but whoever wrote it didn't do their homework. Our markets have slowed down but that is because of the severe inventory shortage. There are still buyers out there looking for investment properties. I know of one property that came to market and received 20 offers, with the top two offers being cash and over $100k above asking price.

Hawaii is a great market to get into, but do your homework and know where you can and cannot legally do STR's. Each island is different so don't think that what is allowed on one is allowed on another. Be patient, be vigilant and be ready to jump if you see a property you like and where the numbers work.

@Lauren Ruppert Great question. Can you make money? Maybe, but its tough. You need to find the right property in the right location and at a price that makes the numbers work. Challenge with the big island is you can only do STR's in specific visitor designated zones. And you also have to consider the fact that there are a decent number of resorts you have to compete with.

Again, it can be done but patience and running numbers will make all the difference here.

@James Potter there are a lot of people on BP who like to share their expert advice, although having never done business in that market. First bit of advice is to connect with someone in that market. They know best what the local regulations are (and they differ across the state). Then start to look st the numbers. Opportunities do exist in spite of this NOT being a buyers market.

@James Potter If you are considering an STR property, you'll have similar rules to Kauai, in that it has to be in a designated area. Most of the areas are areas zoned for resorts.

If you are thinking longer term, yes, you can get more for your money on the big island.