{"id":33729,"date":"2022-10-26T13:50:52","date_gmt":"2022-10-26T20:50:52","guid":{"rendered":"https:\/\/www.homelight.com\/blog\/?p=33729"},"modified":"2024-10-23T11:24:12","modified_gmt":"2024-10-23T18:24:12","slug":"buyer-buying-a-home-in-hawaii","status":"publish","type":"post","link":"https:\/\/www.homelight.com\/blog\/buyer-buying-a-home-in-hawaii\/","title":{"rendered":"If the Beach is Calling Your Name, Answer It \u2014 Follow These Steps for Buying a Home in Hawaii"},"content":{"rendered":"

If you\u2019re ready to call the majestic cliffs and pristine beaches of Hawaii \u201chome,\u201d you may be in luck. The beautiful scenery, combined with a rise in remote work capabilities, drew many homebuyers to the islands of Hawaii in 2020 and 2021. But more recently, the market has shifted to favor buyers, with a 17.07% decrease in year-to-date home sales<\/a>. That means now is a great time to buy in the Aloha State!<\/p>\n

But beginning the journey toward home ownership in Hawaii needs to be approached with more than a great cup of Kona coffee. In order to get the inside scoop on buying a home in Hawaii, we spoke with Todd Hudson<\/a>, a top real estate agent in Kihei, Hawaii<\/a> on the island of Maui. With fifteen years of experience and a track record of closing 78% more homes than the average local agent, Hudson knows the ins and outs of Hawaiian homebuying better than most.<\/p>\n\n\n\n\n\n

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Buying a Home in The Beautiful State of Hawaii? A Top Agent Can Help<\/h3>\n

Whether you were born and raised in Hawaii or are relocating for a change of scenery, working with a top agent to buy your island home is key to success. HomeLight analyzes over 27 million transactions and thousands of reviews to find you the best agent for your needs.<\/p>\n \n

\n Find a Buyer's Agent<\/a>\n <\/div>\n <\/div>\n<\/div>\n\n\n
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Steps to buying a home in Hawaii<\/h2>\n

Let\u2019s dive into the steps of buying a house<\/a> in Hawaii:<\/p>\n

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1. Assess your readiness<\/h3>\n

Before you start looking for homes in Hawaii, you want to determine if you\u2019re ready to purchase one. Consider factors such as how long you plan to be in the area, if you have steady employment, and if you have enough money saved for not just the down payment, but for closing costs<\/a>, maintenance, property taxes, and more. Homebuyers in Hawaii pay $7,463 on average<\/a> in closing costs when purchasing a home.<\/p>\n

During this time, review your credit score<\/a> and determine if it\u2019s considered excellent, good, fair, or poor. Typically, the higher your credit score, the lower your interest rate will be, which saves you money over the life of the loan. You may want to pay off any collections accounts, dispute errors on your credit report, and pay down your credit card balances before you start shopping for a home.<\/p>\n

If you\u2019re moving from out of state, Hudson says it\u2019s also important to assess the reality of moving to the islands. \u201cYou’re going to be 2,500 miles away from the easiest point to get back into the rest of the mainland,\u201d he says. That kind of distance isn\u2019t feasible for everyone, so it\u2019s something you\u2019ll need to consider before buying property in Hawaii.<\/p>\n

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2. Saving for your down payment<\/h3>\n

The average home price in Hawaii is $910,349<\/a>, as of September, 2022, though prices vary significantly between the various islands. In general, you can expect to spend somewhere around that number depending on what part of Hawaii you\u2019re purchasing in, the home\u2019s age and condition, and the size of the property, among other factors.<\/p>\n

Different loan programs will require different down payment amounts, but you do not always need to put 20% down when buying a home. A survey completed by the National Association of Realtors found that first-time homebuyers put just 7% down<\/a> on average in 2021.<\/p>\n

Consider the following down payment assistance programs in Hawaii:<\/p>\n

HHOC Down Payment Assistance Loan<\/a><\/h4>\n

The HHOC Down Payment Assistance Loan acts as a sort of second mortgage by loaning you up to $75,000 for a down payment and other upfront costs of buying a home. The benefit of using this assistance comes in the form of avoiding mortgage insurance requirements (which can add a significant amount to your monthly payment). Applicants must meet certain requirements, such as being a first-time homebuyer and having a minimum credit score of 700. Repayment of the assistance loan comes at a 5% interest rate over 15 years.<\/p>\n

Honolulu Down Payment Loan Program<\/a><\/h4>\n

The city and county of Honolulu offers a similar program. First-time homebuyers who meet certain residency, income, and credit criteria can apply for a loan of up to $40,000 to help with a mortgage down payment. This loan comes with no interest and no fees, and the total sum owed can be reduced by $2,000 for each year that you live in the home.<\/p>\n

Hula Mae Mortgage Loan Program<\/a><\/h4>\n

The Hawaii Housing Finance and Development Corporation (HHFDC) helps first-time homebuyers secure loans at low interest rates through the Hula Mae program. Similar to the Fannie Mae program, these loans are secured through participating lenders. The program also allows for down payment assistance of up to 3% of the purchase price, with terms varying by lender. To qualify for Hula Mae, your household income must fall below certain published limits.<\/p>\n

\n You should probably use a lender who’s based in the state, because they’re going to know some of the nuances between our properties. We’ve had a lot of deals with some of these out-of-state lenders as well as purely online lenders, and they kinda mess up the deal in the last hour.<\/q>\n
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