Frequently Asked Questions
Are vacation rentals/investment properties in Kauai profitable?
They often are, but that highly depends on your situation and various factors such as
- Will you have a mortgage?
- How much time do you plan to spend in the property yourself?
- What daily rates can this property garner (if you use it as a vacation rental)?
- What occupancy % can you achieve?
- How much money will you need to invest in remodeling or repairs?
- Do you manage the property yourself or will you engage a property management company?
We can assist you by providing detailed financial models that can help you determine the profitability of investment properties. Also, check out our financial calculator!
I have a realtor already – why should I work with you?
- Realtors are very busy and often can’t dedicate much time to providing guidance and help you systematically evaluate properties in detail, including financial models.
- In my experience, realtors may not have personally seen all the properties they’re discussing with clients and might make recommendations mostly based on the listing information.
- Realtors are on the island and have themselves not gone through and experienced the process from the perspective of a remote buyer/investor.
- At the end of the day, realtors tend to be motivated by the commission, which means the higher-priced property you buy, the more money is in it for them. Once the transaction is completed, they quickly move on and leave buyers to their own devices.
- We have been off island buyers, done this successfully, know the process and where the gaps are. We can provide unique guidance and perspective.
How can you help me evaluate properties?
We will work with you to determine specific criteria that are important to you when it comes to your future dream home in Kauai. We will then use that criteria to systematically score and evaluate suitable properties to build an initial short list.
What do you mean by “pre-screening” properties?
Once you have the initial short list of properties, e.g. 10-15, you still don’t know if they are truly what you’re looking for since you’ve just been using listing information and photos. We will visit the properties on your behalf and help weed out ones that look great on paper, but don’t really hold up in the real world. That way, you have a better and more manageable list of really great properties to consider and hopefully later check out in person yourself.
How much does your service cost?
We have a reasonable fixed price structure which makes the cost of our services quite predictable. Please contact us for more details.
Can I just buy a property remotely?
In theory yes and people have done that, maybe utilizing Skype or FaceTime for walk-throughs. But think about this: You’ll be making a significant investment and will want enjoy the home, which you’ll hopefully own for many years, yourself. Do you really want to make a decision like that without having seen the property and its surroundings with your own eyes and having smelled the island air?
How much time do I need to spend in Kauai to buy a property?
That depends on several factors. Assuming you a
re using our services and are visiting to visit the properties from your narrowed-down short list and make offers (maybe in combination with a mini vacation), we would recommend at least 3-5 days on the ground.
I live on the mainland – does owning an investment property in Hawaii even make sense?
While the distance certainly does pose some challenges, it can make sense for a number of reasons: A vacation property in Kauai can generate a healthy amount of revenue as a rental. It can also be a great destination for your own trips and you of course have the option to turn it into a second or full-time home for yourself later on. And like with any other property, appreciation is always a welcome benefit. Lastly, Kauai is not overly developed (yet). If development does happen, it may be beneficial to enter into the market before prices take off. And if you’re afraid of taking care of the property from afar, know that local management companies specialize in that and do it all the time for many people.
What help can you provide after the transaction is complete?
As you take over the responsibility for your new property and your realtor quickly moves on to the next transaction, we can help by introducing you to companies and individuals whom you’ll need to get up and running quickly with your new home. Kauai is unique due to its small size and limited supply of service providers, but we can help get you get “plugged in” into this ecosystem, so you can take care of repairs, upgrades, interior design upgrades, hire a property management company (if necessary), and so on. We can also point you in the right direction as to paying local GE and TA taxes and other things you’ll have to think about.
Do you have experience with 1031 exchanges?
Yes, we do! As a matter of fact, we bought our Kauai property via a 1031 exchange. We can help!
If I own an investment property in Kauai, can I just go and stay there whenever I want?
It’s your property, so basically you can do whatever you want! That said, there are some practical considerations as your property management company (if applicable) may impose certain limitations (they want to make money too!) and – more importantly – your tax treatment will change if you exceed certain thresholds. For more information, please reach out.
How do I get more information?
Please contact us!