Oahu Real Estate ... A book could be written on Oahu Real Estate and Buying a Home on Oahu. I will try to condense some important information about Buying Real Estate on Oahu into a nutshell. Hopefully, your questions about Oahu real estate will be answered here, but if you have more in-depth questions about any aspect of Oahu Real Estate, please don't hesitate to call me at 808-721-8088 or see my website at www.OahuRealEstateHawaii.com.
Not everyone is familiar with this island, so let's start with the basics:
1. Oahu is an Island - It's not a city and it's not a county. But the entire Island of Oahu makes up the County of Honolulu.
And Hawaii is the state (we are part of the United States, you'd be amazed but some people forget that) in which this island is located. Hawaii is also the name of one of the 8 major islands in the chain of Hawaiian islands which comprise the State of Hawaii. We call the Island of Hawaii "The Big Island," most of the time, not to confuse it with the State. But, sometimes, people get confused and call the Island of Oahu the Big Island, because it is the most populated of the Hawaiian islands and it is pretty big (#3, though, to Hawaii #1 and Maui #2). Try not to ever do this.
And remember when you fly here, to make sure to fly into the Honolulu International Airport (HNL) and not Kailua-Kona or Hilo on the Big Island. There is a "Kailua" on Oahu, too, just to confuse matters more. :)
2. Honolulu is the Largest City on Oahu ... And the most populated city in all of Hawaii. In fact, about 75% of the population of the entire Hawaiian Island chain lives on the island of Oahu, and about 75% of the population on Oahu lives in Honolulu.
What does this mean? It means, besides people, Oahu has more jobs, more housing, more activity, more cultural activities, more schools, more hospitals, etc. Oahu also has three major freeways, H1, H-2 and H-3 and other minor highways that help people to get around on Oahu. The City and County of Honolulu is also looking into a rail system, because the traffic on H-1 can get pretty bad at rush hour. Most jobs are in Honolulu or "Town" as we call it, but there are other pockets of commerical activity in all of the other cities and towns on Oahu, including Kapolei, Kailua, Mililani, Aiea, Kaneohe and other areas of Oahu. Many people also work from home.
3. Real Estate on Oahu is Expensive ... By most standards on the Mainland (Mainland = 48 states, Continental U.S., if you are unfamiliar with the term). If you are from big cities like San Francisco, Los Angeles, and New York City, you may not be phazed by the price of Oahu real estate. Oahu Real Estate Statistics.
But Property Taxes on Oahu real estate and all of Hawaii real estate are very LOW. More on Oahu Real Estate Taxes. That's a nice suprise, isn't it?
Certain other things on Oahu can also be expensive, like gas and electricity, but if you are from CA, again, you won't see much of a difference. More on Cost of Living on Oahu. If you move to Oahu, these items may not impact your family as much as you might think, as many homes on Oahu don't use or rarely use air conditioners and you almost never would see central heat in houses for sale on Oahu. Your commute also may not be as long here, as it would be if you are from somewhere like L.A., Phoenix or New York.
4. Oahu Real Estate is Resilient - The Oahu real estate market was not hit as hard as those on the mainland. Recent statistics show prices rising, though sales are down from the past months when the First Time Home Buyers Credit was still alive.
There are many reasons for this. Oahu has a large military population which helps strengthen and stabilize the real estate market, due to constant comings and goings, and which helps provide many civilian jobs to the local community. Just another reason for Hawaii residents to thank these fine men and women.
Oahu real estate also is desirable in a very global marketplace. Home Buyers and investors come here from all around the world. The Japanese, Chinese, Korean, and others have always been interested in Oahu Real Estate and they still are. Global interest in real estate also helps to minimize deep fluctuations based on the U.S. economy alone.
Also, local Hawaii banks have traditionally been very conservative in their lending practices. This is not to say that we are not seeing any short sales or foreclosures on Oahu, but it seems to me that most of the the affected lenders are mainland banks. Loans that were kept local have not been as problematic and, in general, those people are still in their houses.
Another factor that helps keep the Oahu real estate market strong is simply scarcity. There are limited bounds to this island. There is little new development in East Oahu. This island is a beautiful and desirable place to live. Basic concepts of supply and demand prevail.
5. You Can and Most Other People Do Own Oahu Real Estate In Fee Simple - Many people come onto this island thinking that fee simple Oahu real estate is not available, that the State owns all the Oahu real estate and you must buy leasehold, or that real estate on Oahu must be purchased via a lottery. Read More on Tenure of Oahu Real Estate.
This is not the case. To simplify the explanaton, it used to be that there were a few very large landowners and that Oahu real estate purchases were often only leasehold purchases. The landowners retained the fee simple interest and the leasehold owners rented the land underneath their home, which they owned. If the lease ended and was not renewed, you could theoritcally take your home away and move it. Does not work, though with a condo. Now, most of the fees have been sold and only a handful of leasehold properties remain. Many of the remaining leashold properties have the fee simple interest available to purchase with the fee. But others do not.
When considering the purchase of a leasehold property it is VERY important to have the good counsel of a knowlegable REALTOR or attorney. because, depending upon the circumstances of the particular property, it could be risky. People who buy into certain leashold properties could end up losing their homes and this is no joke. Not all leasehold properties should be avoided, however. Some can work for many people, depending upon your needs, and the terms of the lease agreement for the property.
PART TWO: THE NUTS AND BOLTS OF FINDING A PROPERTY ON OAHU
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