Buying a Big Island Condo: 3 Questions Buyers Ask First

Most of the people I work with live on the mainland or in Canada, and they ask the same three questions before anything else. Here are plain answers, so you know what to look at before you fall in love with a unit.

1. What will I actually own? Fee simple vs leasehold

A fee simple condo means you own your unit and an interest in the land under it, outright. A leasehold condo means you own the right to use it until the lease ends, and you usually pay lease rent on top of your other costs.

Leasehold units can look cheaper, but they are harder to finance, and the number of years left on the lease matters a great deal when you sell. Every listing on this site shows whether a property is fee simple or leasehold, so you can filter for it from the start.

For the full breakdown, read Fee Simple vs Leasehold Properties in Hawaii.

2. Can I rent it out short term?

Short-term vacation rentals (STVRs) in Hawaii County are regulated under Ordinance 2018-114 (Bill 108) and Planning Department Rule 23. An existing rental that sits outside a zoning district where the use is permitted can operate under a Nonconforming Use Certificate, which has to be renewed every year. The county explains the process on its short-term vacation rentals page.

Before you write an offer on any condo you plan to rent, check three things:

• The county's status for that specific unit.
• The condo association's own rental rules. An association can restrict rentals even where the zoning allows them.
• What has to be filed when ownership changes. The county has a Change of Information application for this.

I go deeper in my Big Island Vacation Rental Condo Buying Guide, and you can browse vacation-rental-friendly condos in Kona or in Waikoloa Beach Resort.

3. What will it cost to hold?

The purchase price is only part of it. Plan for HOA dues, property tax, insurance and, if you rent, Hawaii's transient accommodations tax and general excise tax plus any management fees.

Ask for the association's budget, its reserve study and recent meeting minutes, and ask whether any special assessments are planned. A lower-priced unit with high dues or an upcoming assessment can cost more over time than a higher-priced one in a well-run building.

Want me to run the numbers for you?

Tell me which buildings or areas you are looking at, and I will send you the listings that fit along with the dues, rules and rental status for each. Contact me here or call or text 808-491-8115.

Jeff Gaughan, R(S)-81116
eXp Realty | Kona Homes and Condos