Owning Land In Hawaii: Pros & Cons | askBAMLand

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Owning land in Hawaii may seem like a dream come true but is it all that it’s shown to be? Learn about the pros and cons of owning land in Hawaii.

Hawaii makes one of the best and most sought-after places in the world to visit and live. After all, it is home to some of the most amazing beaches, sunny weather, and various landscapes ranging from misty plateaus to lava deserts and the snow-capped peak of Mauna Kea. On the surface, Hawaii offers everything that would make you want to live there. But if you are planning to purchase land in Hawaii, you need to know all the benefits and the potential drawbacks.

Hawaii makes an extremely attractive location for owning land as it makes a state where your property value will certainly appreciate. However, the homes are smaller and more expensive, and construction is often costly and delayed, so you may reconsider buying land in this state.

Real estate investors have been curious about the lands in Hawaii for all great reasons. While you may believe that owning lands in various states will get you amazing returns, that's not always the case. The value of land doesn't always increase as you would expect in all states but owning land in Hawaii is definitely a win-win situation. If you make the right choices, no one can stop you from getting your desired results. However, owning land in Hawaii isn’t cheap. Not to mention the ongoing threat of lava zones and natural disasters in the state.

As experts in the real estate industry, we know that owning land can be a huge decision, and for making the right investment choice, you need to do your homework right. But given our experience and thorough understanding of the property landscape in Hawaii, we can provide you an insight into the pros and cons of owning land in Hawaii.

Table of Contents

Pros of Owning Land in Hawaii

An Abundance of Natural Beauty

For many people, Hawaii is a dream destination. Its beautiful sandy beaches and picturesque landscape is perhaps the first thing that comes to mind when people think of Hawaii. And they would be right. The state is home to some of the most amazing beaches, tropical areas, bamboo forests, lava deserts, and more. However, most people don't know that the abundance of natural beauty in the state brings many benefits to owning land here. Whether you are looking for land to build your dream home or construct your holiday destination, owning land in Hawaii makes the best bet.

Appreciation of Your Property Value

If you intend to own the land in Hawaii for the long term, it makes an excellent investment as property values in Hawaii are on the rise, making your land investment a valuable asset.

Unlike the unpredictable stock market, real estate markets don’t fluctuate as often. In fact, the real estate market typically goes up over time. While there may be a few dips along the way, in the long run, you can expect your property in Hawaii to appreciate and offer you great returns.

If you are investing in raw land, you can also improve your return by adding facilities and features to your land, which will further enhance the value of your property in the long run.

Warm and Sunny Weather

Weather fluctuations and extreme weather conditions can be a concern in most states. However, that's not the case in Hawaii. The weather is warm and sunny on most days of the year because Hawaii is the southernmost state in the country which places it near the equator.

While there are 11 sub-climatic zones throughout the state, the weather is nice throughout the state all around the year. If you choose to live near the beaches, you can expect warmer and more humid weather. However, if you choose to live towards the northern or eastern side of the state, you can expect more rainfall throughout the year. The farther away you are from the beaches, the lower temperatures you can expect.

You Gain Tax Advantage

Another incentive of owning land in Hawaii is that you gain a tax advantage. The mortgage interest is tax-deductible, which means you can enjoy significant tax savings as you own a home in Hawaii.

Cons of Owning Land in Hawaii

While there are several advantages of owning land in Hawaii, it doesn't come without cons. From high property value to the high cost of construction and a much higher need for maintenance and upkeep, you need to know some disadvantages of owning land in Hawaii.

High Property Value

It shouldn't come as a surprise that the property value in Hawaii is much higher than in several other states. After all, it is the most sought-after tourist destination.

The price per square foot of land is well over $600 for single-family homes in most Oahu neighborhoods, including Kapolei, Mililani, Kailua, Kaneohe, andEwa Beach. Moreover, you can expect even higher price tags in neighborhoods like Kailua and Hawaii Kai.

Homes are Smaller Than U.S. Mainland

Apart from the higher property value, another con that you need to know about owning land in Hawaii is the smaller home sizes in the state. The homes in Hawaii are smaller compared to the average home sizes in the U.S. Mainland. Since land in Hawaii is limited, you can look forward to owning a small home with a higher price tag if you choose to own land in Hawaii.

Higher Construction Cost and Delays in Construction

As you expect to pay more for owning the land in Hawaii, you should also expect to pay more for the construction process. The labor and construction materials which are essentials for construction are shipped from across the ocean, which adds to the cost of construction. Moreover, even when spending extra on the construction process is not a concern for you, be prepared to experience delays in the construction process as there are often construction delays in Hawaii. Construction delays are inevitable with a limited number of contractors and construction workers.

Constant Need for Maintenance and Upkeep

As you intend to invest in land in Hawaii, know that the blue seas of the state, which often seem like an attraction, bring along salty and humid air that can damage your property. Given the high humidity content in the air, you can look forward to quick rusting of metals and rotting or swelling of wood which is why it is recommended to use stainless steel materials for longer-lasting construction and regular repainting and staining of wood that can help preserve your home’s wooden structures for longer. Moreover, since Hawaii is prone to natural disasters and extensive wind, you may also require specialized maintenance so your Hawaii home can withstand the Hawaii air.

Prone to Natural Disasters

As you choose Hawaii as the state where you look forward to land ownership, let's not forget that the state is prone to natural disasters, including hurricanes, floods, and even volcanic eruptions.

Since Hawaii receives a lot of rain, floods happen almost every year, which can cause extensive property damage. If you are planning to purchase land in Hawaii, make sure you choose a location that doesn't receive a lot of rainfall so you can protect your property against damage. Moreover, the ocean’s giant waves continue to flood Hawaii homes on all the islands, so if you are planning to own land in Hawaii on one of the islands, don't forget to check the area's previous flooding history and designation of the flood zone for your property.

Furthermore, there are active volcanoes in Hawaii, and the state experienced the most recent destructive eruption in 2018, where the Kilauea's eruption destroyed over 700 homes. While there aren't many other active volcanoes in the state, you should still inquire about the volcanic activity and the volcanic air, which can be a concern in some areas of the state.

You May Capture Your Own Water Supply

The suburban areas of Hawaii are not as developed as other states when it comes to infrastructure. There are several places in Hawaii where the infrastructure for water distribution doesn't exist, so property owners have to rely on private rainwater catchment systems to help homes meet their water needs. The only exception is the state in the cities of Hilo and Kailua-Kona, where each home has its own rain catchment system that collects rainwater. And when it doesn't rain for a while, you have to transport the water through private entities, which can be expensive.


Brittany Melling

Brittany Melling

Brittany has been in the land business since 2020 when the world was starting to shut down. Since then, we’ve sold to dozens of people from ATV weekend warriors to camping enthusiasts to retired truck drivers. Our inventory spans mostly in the western United States. We’ve been trained by experience, land acquisition courses, and hundreds of hours meeting with county assessors and clerks, zoning officials, realtors, and land investors. We’ve answered hundreds of questions from people regarding the buying and use of land.

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