I remember the discussions my husband and I had leading up to our big move to Hawaii. It was a year before we were actually moving to Hawaii and to say we were excited about it is a major understatement! We were living in Monterey, CA while my husband worked on attaining his Master’s Degree while attending the Naval Postgraduate School (NPS) and we fell in love with the area and lifestyle. We joked about how the only way we could depart Monterey gracefully was if we relocated to Hawaii. Thankfully, that dream became a reality and I didn’t have to mentally prepare for a downgrade in picturesque surroundings.
As you can relate to, discussions that followed the news of WHERE we were relocating, soon morphed into WHERE to live on Oahu? We lived in Japan for three years and had only been to Oahu for one short-lived weekend in 2009 where we stayed in a Waikiki Hotel and never left the beach!
Envisioning what life will be like, planning ahead, understanding a new city, figuring out neighborhood lifestyles, best schools, what we could afford, etc are all part of the things most of us military spouse’s enjoy doing and having some say in it if not complete control over. It’s a mutual decision of course but putting our tentacles out as far as they could reach within our network, the research and development of my plan started to take shape after almost everyone we knew told us we belonged in Kailua because it was “our style”. I didn’t know what that meant, but I went with it!
The next question we addressed was, should we buy or rent? By this time in our lives, we had figured out that it was a good thing to buy real estate when we could. It was another way of investing in ourselves over time since our frequent moves were often an obstacle to a steady second income. Not to mention renting is paying someone else’s mortgage when we could be paying down our own. But that’s a whole other story…
I started watching the HGTV shows and reading real estate blog posts online to learn more about buying in Hawaii. Could we afford it? The price tags were so ridiculously high!?! That’s when I started learning about the VA loan available to military families. .
Long story short, we initially rented because we stumbled upon a house that was somehow less than our BAH, four houses from Kailua Beach. Yes, we had to pay two months worth of rent just to hold that location because it was up for rent before we moved to the island, but we felt the experience of beach life was worth it. What we didn’t know at the time we reached our decision to rent, was that our landlord would be a slum lord and wouldn’t pay for anything. Not only did we sink a lot of money into someone else’s property asset, but they continuously raised the rent on us until we looked at one another and RE-realized we were not only paying someone else’s mortgage, but that we could afford to buy in Hawaii too! We were paying more in rent at that point, than we would be if we had bought ourselves?!
We had met and become good friends with Shannon King, now my Broker. In the two years we rented, I began working for Shannon in the back office and we spent a lot of time hearing her educate us and our friends about the market, about buying in Hawaii and watching other families, both military and local residents successfully purchasing property around the island. Shannon helped to debunk all of our “why we can’ts” and found us a house in our price range that worked for our finances. Not only did we find a cool 3 bedroom/2 bath house with a bonus room that was used as a hula studio in the 50’s, we learned we could renovate that to become either a 4 bedroom/2 bath or a 3 bedroom/1 bath with a 1 bedroom/1bath Ohana Suite that would offer dual rental income if we ever moved off island. In that case, not only would we cover our mortgage, we could be cash positive every month! Happy to say, we have been home owners for just over a year and we used the VA loan to do it!
Because we purchased a home instead of continuing to rent, we are paying ourselves every month instead of someone else. A large portion of what we pay toward our mortgage pays down our principal and helps build equity. While we may no longer live ON the beach, we only live ONE MILE from the most popular beaches in the world and have put repair money into our own investment, not someone else’s. In our first year of living in our home, we received a $80,000 tax credit because it is our primary residence and our renovations increase our home value and accrued repairs are tax write offs.
I feel satisfied and smart for having bought a home here. If it’s our forever home and we retire here or return to Hawaii after we retire, I have roots already in the ground. If it is an investment property and we are able to help other families live in a nice home while they are in Hawaii, I feel good about sharing a place that is near and dear to my heart. I also relish in the fact that we have a different type of savings account happening- something that other people could potentially pay down for us...our money working for us instead of us working for money. We learned a lot about home ownership, design and renovations, making our dollars stretch and count wherever we spent them. If I can help other families realize their dreams of home ownership in Hawaii and it makes sense for them financially, I am happy to share everything we have learned on our own journey to home ownership. The dream come-true part, the good, the bad and the ugly! There are a lot of things I want to share with you. From loan breakdowns, home buying in Hawaii 101, and far more interesting stories… please don’t hesitate to reach out to me if you need help or have any questions!
~ Sarah Baker