Are you a renter in Hawaii and you're looking to get into the real estate market or buy your first home? In this episode of Aloha O'ahu, I’m going to share how my clients, the Lees, were able to buy their own single-family home. We’ll learn about the steps they took to make it happen and how you can buy a home, too.
Meet The Lees
It's not an automatic move to get into your forever home. Rather, it takes a series of steps to get to the goal of owning your own property. And if you think you are meant to rent forever, you may not after watching this video.
One of the best things I get to do is to watch buyers invest in themselves and their future by investing in property. It is a way to build wealth by building equity in your property. I want to share with you the story of the Lees so that you can see how you can get into your own property.
Today, the Lees own their own single-family home in Makakilo. They are thrilled to have the space that they need for their family in a location that they love. However, prior to owning their own home, the Lees faced a challenge.
Overcoming Obstacles
The Lees’ challenge was the fact they were a “normal” dual-working couple who wanted to purchase their own home on Oahu. So where did they start? Did they start in their single-family home? No, they did not. Being a renter means that you are paying someone else's mortgage, so it's hard to put money away.
Still, you have to start somewhere! Mr. Lee started putting money away little by little. He knew that to get a conventional loan he'd probably need 10% down for his first purchase, so he started saving. Mr. Lee knew that he could not start with a single-family home, but he understood his starter home would probably be a condo.
He saved about $40,000 over time and bought a condo for a little bit less than $400,000 in June 2019. Over the next year and a half, Mr. Lee continually made his payments and started building equity in his condo. In addition, the value of his condo went up over 25% in two years.
Taking The Next Step
The Lees had a child and hoped for more space, so they decided to put their condo up for sale—and it sold for $510,000. Before they listed, I advised them that to buy again, they were going to have to sell their condominium and rent somewhere else temporarily. That way, they could go shopping with cash in hand.
In the interim, they rented a condo in Town until their dream home in their dream neighborhood became available. When that home came on the market, they were able to make an immediate offer with a significant down payment.
By buying their condo first and letting it appreciate, they were eventually able to buy a single-family home in the Kapolei area. They did not go from renting straight into single-family home ownership. They took the intermediary step of buying that condo and letting that condo appreciate so that they had the funds to buy their single-family home.
From Renter To Homeowner
The main thing here was that my client was able to go from renter to condo owner to single-family homeowner. The process was taking one step at a time, and they took my advice on how to move forward during each step.
Renting in Town was not easy or fun for them, but it is what they needed to do to put themselves in the best position to buy that home. We had quite a few challenges along the way during this transaction. However, with communication, teamwork, and negotiation, it all worked out.
The next time someone tells you you can't be a homeowner, please know that it's still possible. There are special loans and first-time homebuyer programs out there that can help you achieve the goal of getting your own place. While your first property may be a condominium, a few years later you can buy a home.
I’m Here To Help
Remember, you have to start somewhere, just like the Lees. That's exactly what we did. My husband and I started by buying a condo in Kaneohe and eventually moved our way to a single-family home in Kailua.
Just like the Lees and just like me, you could do it, too! It just takes long-term planning—and I'm here to help you with that. If you find yourself or if you know of someone in a similar situation who I can help, please reach out and let me know. I’ll be happy to help however I can.
Don’t forget to subscribe to my channel so you never miss an episode of Aloha O'ahu, my show all about living here on this beautiful island. Stay tuned to see what I feature next!