Buying an Income Producing Vacation Rental Property on Kauai!

Buying a vacation rental property on Kauai can be a great investment!

How does it work? There is a lot to consider as you decide which property to buy as your vacation rental.  Here is some information that should help you in determining which property will be best for you!

Before we get deep into the details it's important to remember that as a Realtor I help people buy and sell real estate on Kauai. If you are interested in another Hawaiian island I'd be happy to connect you with someone great who can help you there.

When looking at a vacation rental property on Kauai as an investment it's important to think about what people on vacation want.  Here are some of the top request and concerns, these items effect the properties value and what people are willing to pay for it on a nightly rental bases.

1. Oceanfront (this could be on the bluff for example in Princeville)
2. Almost oceanfront (could be accross the street or within 3 minutes of walking)
3. Ocean View
4. Privacy
5. Walk-Ability to Restaurants and to the Beach
6. Number of Bedrooms (more bedrooms = higher nightly rental rate)
7. Sunset Views
8. The Condition of the Property

 

Lawai Road in sunny Poipu I often have conversations with people that being with "I've been renting a place on Lawai Rd...I just love this place" It's an easy place to fall in love with...this walk around the lanai shows why! #kauai #hawaii #poipu #lawairoad #lawai #beachfront #beachhouse #kauairealestatepro

A post shared by Anne Eliason, Kauai Realtor (@anne_kauai) on Aug 13, 2016 at 9:39am PDT

Because of the laws on Kauai, not every property can be used as a vacation rental.  This makes the properties that can be used as a vacation rental more valuable.  Properties that can be used as vacation rentals fall into one of two categories:

1. They are located in A VDA (Visitor Destination Area) like Princeville and Poipu
2. . They have a TVR (vacation license). The county of Kauai is not giving out vacation licenses so a property either has one, or it doesn't.

 

The driveway everyone wants...and its in paradise! 4 bed/5 bath, a guest house, oceanviews from every room, 2 minute walk to the beach, and its has a TVR! PM me for details! #4bedrooms #5bathrooms #guesthouse #oceanviews #luxuryexperience #luxuryrealestate #elitepacificproperties #kauai #hawaii #paradise #tvr #tvrkauai #imagine #kauairealestate

A post shared by Anne Eliason, Kauai Realtor (@anne_kauai) on Jan 26, 2017 at 6:38am PST

We know investments do change with time (they can worst, stay the same, or get better).  It's important to consider these variables for each property.

Vacation rental properties are more than an single stream income investment.  As with all real estate investments you have both the cash flow and the potential value increase in the physical property.  As you consider a specific property that has been used as a vacation rental in the past, I can provide you with the rental history. This should give you both the amount of income the vacation rental generated, and the amount of expense it incurred (repairs, management, taxes, etc). If the house or condo wasn't used a a vacation rental it will be important to look at what similar properties in similar location and conditions are making.

For the general purposes of this blog here is the general types of owners of vacation rentals on Kauai are making.  This data supplied by one of the great vacation management companies on Kauai.

• Luxury Beach House: $600,000 a year
• Nice beach house: $250,000 a year
• 4-5 Bedroom home on the bluff in Princeville: $200,000 a year
• 3 Bedroom Oceanfront Condo in Poipu: $110,000 a year
• 1 bedroom Condo in Poipu with an ocean view: $35,000 a year

Weather your budget and tastes take you to a vacation rental on Hanalei bay, or a condo in Poipu. Owning a vacation rental property on Kauai can be both financially rewarding and a lot of fun!  

 

How'd you like this view from your dinning room?? Coming soon... #kauai #hawaii #dinningroomview #view #oceanfront #luxuryrealestate #kauairealestate

A post shared by Anne Eliason, Kauai Realtor (@anne_kauai) on May 23, 2017 at 6:06pm PDT

If you're interested, or would like more information please don't hesitate to reach out to me!  I'm always happy to help!

Aloha,

Anne Eliason

808-855-5808

KauaiRealEstatePro@gmail.com