--- title: PCS to Hawaii: What Active Duty Service Members Need to Know About Buying a Home slug: pcs-to-hawaii-what-active-duty-service-members-need-to-know-about-buying-a-home description: Discover essential tips for active duty members relocating to Hawaii. Learn about the unique real estate market, homeownership, and navigating VA loans. publishedAt: 2024-07-15T20:59:07.000Z updatedAt: 2024-07-15T20:59:07.000Z author: Erica Lehmkuhl categories: [US Military Bases, PCS Help] canonical: https://www.veteranpcs.com/blog/pcs-to-hawaii-what-active-duty-service-members-need-to-know-about-buying-a-home --- # PCS to Hawaii: What Active Duty Service Members Need to Know About Buying a Home Relocating to Hawaii during a **Permanent Change of Station (PCS)** is both exciting and challenging. The idea of living in paradise is appealing, but **navigating Hawaii’s real estate market** requires careful planning. Property values are high, demand is strong, and the local market operates differently from those on the mainland. If you’re considering **buying a home in Hawaii**, it’s important to approach the process with the right strategy. Having been stationed at **Schofield Barracks**, I’ve seen firsthand the opportunities Hawaii real estate can offer—if you know how to **buy wisely**. This guide will help you understand the market, the risks, and the benefits of **purchasing a home in Hawaii with a VA loan**. ### **Understanding the Hawaii Real Estate Market** Hawaii’s real estate market is **unique**, and there are two major misconceptions service members often have when considering a home purchase: - **Buying a home in Hawaii is always a guaranteed investment** - **Hawaii is too expensive to buy into** Both of these assumptions can be **costly mistakes** if not approached correctly. **Real estate appreciation is not guaranteed.** Many homeowners saw substantial gains from 2019 to 2020, but property values fluctuate. If you buy at the wrong time **without a long-term plan**, you could face financial losses. **Hawaii’s high costs don’t mean buying isn’t possible.** While real estate is expensive, the cost of _not_ buying could be even higher. With the right approach, **homeownership can be a valuable long-term investment**—especially if you factor in rental income potential. ### **The Case for Buying a Home in Hawaii** Here’s a real example: We purchased a **home in Haleiwa in 2014 for $650,000** and sold it in 2021 for **$1,140,000**. We also own a **multi-family home in Waialua**, where rental income covers our **mortgage and utilities**, allowing us to live near the ocean at no cost. This lifestyle is possible, but only if you **buy with a strategy**. If you purchase a **move-in-ready** home in a declining market, you may struggle to **break even** when it’s time to sell. However, if you buy **a fixer-upper in a good neighborhood**, you can increase the value and **build equity** over time. ### **Key Considerations for Buying a Home in Hawaii** If you’re thinking about **buying a home** when you PCS to Hawaii, here are three critical factors to keep in mind: **Have an Exit Strategy** - If you need to **sell during a market downturn**, you may not make a profit. Plan ahead by **evaluating rental options** and understanding the financial impact. **Buy Wisely** - Look for **homes in good neighborhoods** that need **minor renovations** rather than fully updated properties. This gives you **instant equity** and increases resale value. **Consider Rental Potential** - A home with a **separate rental unit** (like an **ohana unit** or a **studio over the garage**) can generate income and help offset mortgage costs. ### **The Reality of Renting Out Your Property** Many service members assume they can **rent out their home** if they PCS without selling. While this is true, **most rental properties in Hawaii operate at a loss** unless they have additional rental units. Without **separate rental space**, you could lose between **$500 and $1,500 per month** after factoring in **property management fees and Hawaii taxes**. ### **Legal and Tax Considerations for Homeowners** Hawaii has two **unique laws** that significantly impact property owners: **Short-term vacation rentals are illegal on most of Oahu.** - **Airbnb and VRBO rentals** of less than **30 days** are heavily restricted. New permits are **not being issued**, and violations can result in **fines of up to $10,000 per day**. **HARPTA Withholding Tax (7.25%)** - If you are **not a Hawaii resident** when you sell your home, **7.25% of the sale price** will be withheld under the **Hawaii Real Property Tax Act (HARPTA)**. - This withholding can be **waived or refunded** under certain circumstances, but it requires **proper planning** and working with a **real estate expert** familiar with local laws. ### **Is Buying a Home in Hawaii the Right Move for You?** If you’re considering homeownership in Hawaii, **planning ahead is essential**. Ask yourself: - Can I **afford the mortgage** even if I have to rent out the property later? - Does this home have **rental potential** to help cover costs? - Do I have a **long-term exit strategy** in case the market declines? If you’re not sure, working with a **real estate expert** who understands military relocations in Hawaii can help you **navigate the process with confidence**. ### **Get Expert Help with Your PCS to Hawaii** If you’re moving to **Oahu**, my team has helped hundreds of military families navigate their **PCS transitions**. We’ve created a **comprehensive PCS packet** that includes: - Information on **military housing areas** - Details on **command sponsorship** - Recommendations for **restaurants, hikes, and activities** - A **complete list of TLA-approved hotels** - A breakdown of **Hawaii’s regions** and best places to live - A checklist of **important paperwork** for your move **If you’d like a copy, reach out today!** ### **Frequently Asked Questions** **1. Can I use a VA loan to buy a home in Hawaii?** Yes, VA loans are **widely used in Hawaii** and offer benefits such as **zero down payment and no private mortgage insurance (PMI)**. **2. Is buying a home in Hawaii a good investment?** It can be, but it depends on **market timing, location, and whether the property has rental potential**. **3. What is HARPTA, and how does it affect me?** HARPTA is a **7.25% tax withholding** on the sale price of a home for **non-Hawaii residents**. It can often be **waived or refunded** with proper planning. **4. Can I rent out my home if I PCS?** Yes, but without **additional rental units**, you may experience a monthly financial loss. **5. What are the risks of buying a home in Hawaii?** Market fluctuations can impact **resale value**, and **high property taxes** can make owning a home expensive. ### **Final Thoughts** Buying a home in Hawaii during a PCS move can be a **smart financial decision**—but only if **approached strategically**. With the **right property, rental potential, and a solid exit strategy**, you can turn **homeownership in Hawaii into a long-term asset**. **If you’re considering buying a home in Hawaii, let’s talk!** I can provide **expert guidance, a PCS packet, and real estate insights** to help you make the best decision for your future.