Kona Kohala Blog

I was asked about good deals in the Mauna Lani Resort and the Waikoloa Beach Resort I suppose because I said there were some.  I wasn't able to rattle off my two favorites and I felt like the person who had asked was disappointed.

While there are lots of good deals like a luxury condo selling for more than 30% off from $1.45M down to $1M or less expensive condos that were $700K now for $500K, just how good a deal it is depends on you.  How much money are you putting down?  Is this a cash purchase?  What kind of a Return on Investment (ROI) are you looking for?  What do you think the economy is going to do over the next 5 years?

A good deal, in my mind, means you're saving 25% or more over what something sold for a couple of years ago.  An investor may think a good deal is something that runs in the black i.e., returns more money than it costs them each month.

If you buy with cash, a good return may be 7% per year on that initial outlay.  If you think the economy is going to be improving in the next 5 years then a good deal may be an "under valued" property that will appreciate greatly in the future.  A good deal can be many things but most often is a property that meets your definition of a good deal.

You tell me what your intentions are with the condo or home i.e., rent it all the time or rent it part of the year when you're not using it.  If it's the latter, will you be here during the winter, our peak earning season, or in the summer when it's considered low season?  Are you going to buy it outright or are you going to finance it?  If you're financing, how much are you going to put down which tells me how much you'll be financing, what your monthly mortgage is and how much you have to gross to give you the ROI you want.

As you can see, there are lots of variables.  Buying an investment property should not have any of the emotions found when buying a home to live in.  That means if you're planning on living in this property for part of the year, emotion may play a part but it should never be a major player unless you know you're going to be here a lot and you're going to keep it a long time.

If you're considering an investment property let's start the dialog now.  There's lots of information that needs to be gathered and then applied to numerous properties.  We are in a strong buyer's market meaning there's lots to choose from.  A well thought out purchase will work best and that takes time.  Call today, 808-896-0661 or email Robert@FerrariPacificRealty.com.