Buying property in Hawaiʻi: what buyers from abroad need to know

By the ULTIMATE Hawaiʻi Editorial Team

When a foreign owner sells

Under the Foreign Investment in Real Property Tax Act, buyers of US real property from foreign persons, and certain agents and settlement officers, must withhold 15% of the amount realised (10% for sales before 17 February 2016); in most cases the buyer is the withholding agent (IRS).

Short-term rentals on Oʻahu

Short-term rentals, also called vacation rentals, provide accommodation for less than 30 consecutive days. To preserve housing for long-term residents they are permitted only in resort-zoned areas and a couple of specific apartment-zoned areas, and must be registered; homes in operation since before 22 October 1986 with a nonconforming use certificate renew it each year (Honolulu Department of Planning and Permitting). The neighbour islands have their own county rules.

A licensed agent

The State’s Real Estate Branch, part of the Department of Commerce and Consumer Affairs, licenses brokers and salespeople; verify a professional on its site before you sign (DCCA).

Escrow and the documents

Sales usually close through an escrow company. Engage a Hawaiʻi lawyer of your own to read the title report and, for a condominium, the association’s documents and house rules.

Where people live

See our real estate guide for the condominiums of Waikīkī and Kakaʻako, the houses of Kāhala and Diamond Head, the North Shore and the resort communities of the neighbour islands. We don’t publish prices or yields.

Questions and answers