Renting a Paradise In Hawaii Luxury Vacation Home vs. Staying in a Hotel on your Hawaii Vacation
Our guests range from those who are renting a vacation home for the first time, to those who have rented for years. We love hearing from our first-time vacation home rental guests who are thrilled with the conveniences of beach gear (boogie boards, snorkel sets, bikes, helmets), extra space (and bathrooms!), and the ability to cook as much or as little as they like during their stay – all for significantly less than they would pay in a hotel. Families with kids love the extra space, board games and free high speed internet, and privacy that comes with a house. Great experiences, conveniences and cost savings that you can’t get in a hotel.
Staying in a Hotel
- Space – Less privacy in hotel rooms. Large families can get split up into separate rooms across the hotel.
- Food – You have to eat at Restaurants or Pay extra for a small kitchenette
- Wifi – Many hotels require you to purchase wifi on top of your nightly rate
- Toys – Expensive rates to borrow snorkels, boogie boards, and other beach gear
Staying in a Luxury Vacation Home
- Space – Separate rooms in one house provide privacy while keeping large families close together
- Food – Prepare your own meals in a large, well-equipped kitchen or on the BBQ
- Wifi – Included!
- Toys – Snorkels, boogie boards, and other beach gear included!
Value of Renting a Paradise In Hawaii Luxury Home
So how do you choose which house to rent or which company to rent it from?
We experienced this challenge ourselves, after years of renting vacation homes, we still remember the saggy beds, the minimal cookware, and the frustration of having “off limit” items in other vacation rentals. So when we purchased our own homes as vacation rentals – planning to use them a few weeks a year – we wanted our own families to have a much better experience. We decided that our vacation homes should be as well (or better!) equipped as our primary home – and that the only difference between our smaller and larger homes would be in quantity, not quality.
As we expanded beyond our own homes, we chose to work with homeowners who are also committed to providing this full experience. This means partnering with homeowners who are willing to make the investments required to ensure their homes are as well equipped as our own. As a result, our vacationing Guests get the full experience regardless of which home they stay in.
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Spending the winters away from the cold harsh winters is a dream for many Canadians. For these “snowbirds” what better place is there than Hawaii to realize that dream. Whether you are ready to start being a snowbird right away or purchasing a home in Hawaii in preparation for some day there are certain things to consider specific to Canadians.
First thing you will have to consider is whether your will need to borrow money to purchase your dream home. As Canadians there are a number of options including:
1. US Mortgage from US Financial Institution
This scenario involves approaching a US bank or lending institution that is familiar with Canadians. It is often difficult to find a lender that understands what the CRA are and what a T4 is. They won’t understand you do not have a W2 and a 1040. Also an excellent credit rating in Canada is not the same as a US credit rating. Ironically the same rating companies exist on both sides of the border. The US lending system requires a massive amount of paperwork so before you go down this path make sure to ask if the lender has dealt with Canadians before and successfully helped them get funded.
2. US Mortgage from US Division of Canadian Bank
RBC Bank is the one US affiliate of a Canadian bank that has a US division that can do mortgages in Hawaii. The advantage is they understand Canadian credit systems, tax returns and lingo. They are a good source of potential funding.
3. Leveraging equity in your Canadian Home
For those people that have built up significant equity in their Canadian home, perhaps the easiest way of buying a home in Hawaii is to obtain the funds from their Canadian lender. By setting up a mortgage or line of credit against your Canadian home, it may give you the cash needed to buy your Hawaii home without the stress and paperwork that go with US lenders. From a Hawaii perspective the purchase then becomes a simple cash transaction. It is important to talk to an accountant familiar with US and Canadian tax law to ensure its set up properly and that you can deduct interest.
Looking for more information and help finding your dream home.
Contact us for more assistance:
Paradise in Hawaii Luxury Homes, LP
You never know how many friends and relatives you have until you own a home in Paradise on the Big Island of Hawaii!
We often hear questions around which homes have the best ROI (return on investment) when making a lifestyle investment in Hawaii. We always recommend first looking at what type of personal usage you want so you can make sure the investment will meet your family’s needs.
That said, there are some differences when purchasing a 2-bedroom, 3-bedroom or 4-bedroom vacation home on the Big Island. There are many factors that influence performance of vacation rentals, including:
- Supply and Demand – How many comparable properties are available for rent? The higher the supply the more work you have to do to stand out from the crowd. For example, there are far fewer 4 bedroom homes than 2 and 3 bedroom homes.
- Location – How close is the home to the pools and beaches? How are the views from the Lanai? These details are huge factors in attracting the best renters.
- Quality of Condo development – How new is the development? How are the amenities? How are the pools? Is there a beach close by? Some of these features really stand out and attract premium vacation renters.
- Other factors – Construction next door to your home can be a big detractor for most vacation renters.
We have extensively tracked vacation rentals on the Kohala Coast and have found that most homes will rent at the peak times. The real trick when maximizing ROI is to drive occupancy without sacrificing nightly rates.
Hawaii enjoys remarkably consistent and pleasant weather year round. We have found that if you work diligently and have a superb offering that stands out, you can rent homes for 300-330 paid nights a year. There are many things that go into driving that level of success in a vacation home rental investment.
We have worked hard over the years to drive those levels of occupancy. We have also developed detailed financial models for our 2-, 3- and 4-bedroom homes that we can share with clients. If you are interested in learning more, please contact Jeff for a discussion how we can help you drive those kinds of levels of success.
Paradise in Hawaii Luxury Homes, LP