Hawaii attracts buyers nationwide with its tropical landscapes, island lifestyle, and strong real estate market. With plenty of Hawaii houses for sale, you’ve got options. But buying a house here can be challenging. You must get preapproved, check neighborhoods, and attend open houses.
With Houzeo, Hawaii’s best home buying website, managing your home search is simple. You can look through the latest listings in Hawaii, save your favorites, schedule showings, and submit offers, all at your fingertips.
👉 Download the Houzeo mobile app to simplify your Hawaii home search.
At a Glance:
- Determine whether you’re purchasing a primary home, a vacation getaway, or a rental property, and choose Hawaii cities that match your goals.
- Set aside 30–45 days for mortgage pre-approval. Aim for a credit score of 620+ to stay competitive in Hawaii’s fast-moving market.
- Explore FHA, VA, or USDA loans, and apply for HHFDC programs like Hawaii HomeOwnership Center or down payment support programs.
- Use platforms like Houzeo to search Hawaii homes by city, price, or must-have features like ocean views, lanais, or hurricane-resistant construction.
- Schedule inspections for the roof, HVAC, and plumbing. In coastal areas, add wind mitigation and flood risk assessments.
- Expect 2%–5% in closing costs. After purchase, file for Hawaii’s Home Exemption to reduce your property taxes in Hawaii.
7 Steps for Buying a Home in Hawaii🌋
Buying a house in Hawaii doesn’t have to be complicated. Whether you’re just starting your search or are already browsing homes for sale in Honolulu or any other cities, these 7 simple steps will help you move forward with confidence:
Step 1: Decide Your Homebuying Purpose
Whether you’re looking for a getaway or seeking an investment, knowing why you’re buying Hawaii real estate is essential. It sets your expectations and helps you make smarter choices. Here’s what you should keep in mind:
- Primary Residence vs. Investment: If you want to buy a home, choose places that fit your lifestyle, whether it’s a city like Honolulu or the laid-back charm of Hilo. For investment properties, consider homes for sale in Waikiki, where tourism drives demand.
- Short-Term or Long-Term: If you plan to live in the house for only a few years, focus on neighborhoods with strong resale value and upward market trends. You can check out homes for sale in Kihei, where the housing market continues to grow.
- Space Requirements: If you’re looking for larger lots or big backyards, consider suburban areas like Waimea. But if you prefer something easier to manage, condos in places like downtown Honolulu can be a smart option. However, they often have smaller lots.
Calculate the cost of living in Hawaii to get a detailed breakdown of expenses like housing, utilities, transportation, and more. 🏡
Step 2: Explore Financing Options
Before making a purchase, it’s important to understand the financing options available for you to make an informed decision. Here’s what you need to do:
1. Prepare Financially
- Check Your Credit Score: Lenders will check your credit score to determine if you’re eligible for a loan. Aim for a score of 500+ for an FHA loan and 620+ for a conventional loan.
- Calculate Your Debt-to-Income (DTI) Ratio: Lenders often use your DTI ratio to assess how much home you can afford. Keep your DTI below 36%, especially if you want a home in an expensive region like Kailua or Lahaina.
- Set Your Budget: Ensure your budget includes property taxes, homeowners’ insurance, and potential flood insurance, particularly in Hawaii‘s coastal areas like Kona, Hilo, or Kihei.
👉 Use a Hawaii mortgage calculator to estimate how much property you can afford in the Aloha State.
2. Explore Loans and Assistance Programs
Down payments in Hawaii usually range between 10% and 20%, but often vary based on the financing option you choose. You can also look for suitable Down Payment Assistance Programs (DPAs) to help you cover part or all of your down payment.
| Program | Description |
| FHA Loans | Require just 3.5% down and are ideal for a Hawaii first time home buyer. |
| VA & USDA Loans | Offer 0% down with lower interest rates. Perfect for veterans or those purchasing homes in rural areas. |
| HHFDC Down Payment Assistance Loan (DPAL) | Provided by the Hawaii Housing Finance & Development Corporation (HHFDC), this program offers up to $40,000 in down payment assistance as a 0% interest, deferred loan for eligible first-time buyers. |
| Hawaii HomeOwnership Center (HHOC) Programs | Offer financial education and assistance to help low- and moderate-income buyers qualify for affordable mortgages and manage long-term homeownership costs. |
| Mortgage Credit Certificate (MCC) Program | Allows qualified buyers to claim a federal tax credit for a portion of their annual mortgage interest, helping reduce overall homeownership expenses. |
Step 3: Get Pre-Approved for a Mortgage
The Hawaii housing market is competitive, so get a mortgage pre-approval to show sellers you’re a serious buyer. In fact, 86% of sellers prefer buyers who are pre-approved. It also helps you negotiate better and reduces delays in the transaction.
Shop around to find the best Hawaii mortgage lenders—compare their programs, rates and terms. Once you’ve narrowed down your options, get pre-approved by submitting documents like proof of income, credit history, bank statements, and your ID proof.
Step 4: Dive Into the Hawaii Market
Whether you’re looking at houses for sale in Kailua or anywhere else in the Aloha State, here’s how to buy smart:
- Online Listings: If you’re wondering how to buy a house, starting with online listings is a good first step. Use platforms like Houzeo to search homes for sale by price, zip code, and more. You can also filter for must-haves like a backyard, waterfront view, etc.
- FSBO (For Sale By Owner) Homes: Explore FSBO listings, as they often offer more flexibility in price negotiations. This is because sellers aren’t paying 5% to 6% in agent fees.
Mountain View is the nicest and cheapest place to live in Hawaii. The number of homes for sale in Mountain View is on the rise, thanks to its safe neighborhoods and diverse job opportunities.
Step 5: Make a Competitive Offer
In Hawaii’s competitive housing market, homes tend to sell fast. Make sure you focus on real estate comps for a more accurate picture. Here’s a checklist to help you craft a strong offer:
- Seller’s Name and Address: Don’t forget the basics—include the seller’s legal name and property address.
- Price and Terms: Offer a price based on Fair Market Value (FMV) and comparable sales. In high-demand areas like Kihei, you might need to offer above the asking price to stand out.
- Down Payment: In Hawaii, down payments usually range from 3% to 20%. In competitive markets like Oahu, a larger down payment can strengthen your offer.
- Earnest Money: Boost your earnest money deposit to show you’re serious, especially in hotspots like Lahaina or Kailua-Kona, where homes can go fast.
- Contingencies: Include protections like home inspection, financing, and wind mitigation contingencies. These safeguards protect you from issues like any damage.
- Concessions: Request the seller to cover some closing costs. In Hawaii, it’s common to negotiate repairs after the inspection, such as roof issues, HVAC problems, or plumbing leaks.
- Deadline for Seller’s Response: Set a 24- to 72-hour deadline to encourage a prompt reply. This helps prevent delays and keeps you on track for Hawaii’s average 44-day closing timeline.
- Closing Costs: Expect closing costs around 2% to 5% of the home’s price, including title insurance, property taxes, and lender fees.
Step 6: Conduct Inspections and Appraisals
A standard home inspection in Hawaii should cover:
- HVAC System: Ensure the air conditioning can handle Hawaii’s heat and humidity. It is essential for year-round comfort.
- Plumbing: Check for leaks, corrosion, and water pressure issues, especially in Hawaii homes built before the 1980s. Properties near the ocean, such as in Kailua or Lahaina, are more prone to salt air corrosion.
- Electrical System: Verify everything is up to code and can withstand storm-related power surges, which are common in Hawaii.
- Roof Condition: Assess for storm damage, missing shingles, or age-related wear. It’s important in windward sides like Kaneohe or Hilo.
- Foundation and Structure: Look for cracks, moisture, or settlement issues, particularly in flood-prone or sandy-soil areas.
If you’re browsing Hawaii property for sale or elsewhere, ensure that you get a wind mitigation inspection for hurricane risk. Also, if you have a condo over 30 years old and higher than two stories, make sure you get a Milestone Inspection for structural safety.
Once the inspection is complete, your lender will order a home appraisal to confirm the property’s market value. This step ensures the loan amount aligns with what the home is actually worth. It can impact final loan approval, especially if the appraisal comes in low.
Step 7: Close on Your Hawaii Home
Almost there! Closing usually takes 30–45 days, from signing the contract to getting the keys in your hand. Here’s what you can expect:
- Final Walkthrough: Make sure all repairs have been completed, and the home is in the agreed-upon condition.
- Buyer Closing Costs: Expect to pay 2%–5% of the home price. This includes title fees and lender charges, plus prepaid taxes or insurance.
Once you sign the dotted line and transfer the escrow—congratulations, you’re officially a homeowner. Grab those keys and cue your happy dance! 🎉
What Should You Do After Closing?
Welcome home! Now it’s time to handle a few must-dos to protect your investment:
- File for Homestead Exemption: If the home is your primary residence, apply for Hawaii’s Home Exemption to reduce your property taxes.
- Set Up Utilities: Get water, electric, internet, and trash service connected, often through Hawaiian Electric and Board of Water Supply. And don’t forget pest control, especially in humid areas, where bugs are active year-round.
- Get Insurance: Homeowners insurance is required if you’re financing, and flood insurance may be needed in FEMA zones. Rates are higher in coastal areas due to hurricane risk.
- Home Maintenance Plan: Schedule AC tune-ups at least twice a year, clear gutters regularly, and inspect roofs for storm damage or algae buildup. Consider wind mitigation upgrades to reduce insurance costs.
How to Buy a Home in Hawaii Without a Realtor?
Start by researching neighborhoods and browsing listings on trusted sites like Houzeo. Then, schedule showings directly with sellers or their agents. You can also hire a real estate attorney to review contracts and handle legal details.
Next, get pre-approved for a mortgage, make an offer, schedule inspections, and negotiate repairs. With the necessary due diligence, you can buy a house without a Realtor.
Should You Buy a House in Hawaii?
Absolutely! Buying property in Hawaii offers incredible opportunities for homeowners, whether you’re buying for investment, residence, or vacation. Moreover, with more homes being sold below the list price, now’s the best time to buy a house in Hawaii.
Whether you’re drawn to Tampa’s growing job market or Naples’ coastal charm, Hawaii has it all. There’s a spot to match every lifestyle and budget. So if you’re on the hunt, check out our list of the best places to live in Hawaii!
