Hawaii DSCR Loans for Vacation and Rental Properties
Hawaii offers SFR investors a unique opportunity. Despite its high barrier to entry, with a median home price of $742,600 (up 0.4% YoY), limited inventory and competition among local and non-resident investors, securing a property with the right strategy can lead to a profitable long-term investment.
With the homeownership costs likely to remain high for the foreseeable future, and considering that more than a third of households rent1, long-term rentals are viable in this market. Average rents increased 3.33% YoY2.
While LTRs are viable, they may not be the best option. Considering that tourism is bouncing back to pre-pandemic levels, visitors spent nearly $21 billion in 20243 and the demand for short-term rentals increased; STRs are back as the ideal strategy. While Honolulu and Maui are great options for STRs, the Big Island earned an 88 out of 100 market score on AirDNA4.
How Investors Make Hawaii’s Market Work
Hawaii isn’t the cheapest place to invest, but that hasn’t stopped SFR investors from finding success. With median home prices among the highest in the country and limited inventory, long-term rentals can provide steady income. But the real draw is short-term rentals: tourism continues to soar, and places like Honolulu, Maui, and the Big Island are proving to be strong performers with high revenue potential. With Visio Lending’s DSCR loans, you can secure flexible financing and compete in one of the most unique rental markets in the U.S.
Note: Visio Lending provides Hawaii investors with added asset protection and financial flexibility, as we require all borrowers in the state to invest through an LLC or corporate entity.
Sources:
1: U.S. Census Data
2: Zillow
3: American City Business Journals
4: AirDNA
