Should you be looking to rent or to buy your next island home?
When it comes to figuring out how to set up your living space on the island of Hawai’i, it’s important to consider the benefits and drawbacks for each. Of course, the decision is also highly personal, and intersects heavily with your own personal goals and financial outlook, to name just a few. Here are some of the major benefits and drawbacks of each:
Renting can provide you with important flexibility around your circumstances if you’re exploring the island. If you’re coming over from the mainland or from across the world, then it might be prudent to look towards renting to get a better feel for island culture, to make sure that this is the place where you’d like to lay down some roots. Locking in a mortgage payment or getting a large down payment together might be less than ideal if you’re not certain that the Big Island is where you’d like to live – and don’t forget, staying here on vacation is not the same as coming to live here!
While we’re at it, we can also cite how nice it is to have a landlord be responsible for keeping the property grounds well-maintained and in good working order, allowing you to focus on simply keeping the rent paid on time as you luxuriate on this gorgeous island paradise.
On the downside, it goes without saying that when you rent your money is all going towards helping to pay your landlord or the property owner’s mortgage – leaving you no claim to the property itself, much less the equity that is so important to building wealth.
Buying a house also brings its own unique positives and negatives into the equation to be considered. As we referenced, purchasing a home allows you to utilize the money that would otherwise be going towards the rent to build equity, or the difference between what you owe on a mortgage and what the home itself is worth. This turns your living space into an investment, and diligent, smart investments are how profits are made! Home values are like stocks insofar as they may fluctuate from time to time, but in the long haul they tend to appreciate – and here on the Big Island, one of the world’s most-desirable living locations, home values tend to move up.
Furthermore, when you own your own home, you are firmly in control of how you utilize your space, and are free to remodel, redesign, and decorate how you see fit, which can also help to further increase the value of your home on the market.
Having said that, keep in mind that you are also fully responsible for all your home’s ongoing maintenance, property taxes, and other speed bumps that come your way (such as a broken A/C unit, for example). With no landlord to call, you’re on the hook for all necessary repairs, but many homeowners find that the tradeoff is more than worth it, considering the growing equity that home ownership affords them.
Need help figuring out which approach might be best for you? Ready to make the leap into home ownership?
I’ve helped countless locals and visitors alike make their island dreams come true and would love to help you do the same. Drop me a line and let’s get started on finding you the perfect property to call your own. Aloha!