HONOLULU (KHON2) – Is this the year you are looking to become a homeowner in Hawaii? Many people set individual goals for the new year and for many becoming a homeowner is one of them.
Smartasset came out with a Hawaii Mortgage Calculator breaking down the average cost of owning a Hawaii home. According to their finding’s Hawaii’s median home value is the highest in the U.S. around $722,500.
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Some good news about being a Hawaii homeowner, according to the study, Hawaii has the lowest average effective property tax rate in the country sitting at .27%.
Today’s mortgage rates are between 5-6.5% depending on the type of loan you qualify for. Smartasset recommends having at least $30,000 saved before applying for a home loan.
They also recommend having a minimum income of $90,000 to ensure your monthly payment and other debts do no exceed 36% of your monthly income.
Depending on what island you are looking to buy your house on will factor how much money you are likely to spend. For example, houses on Maui and Oahu tend to be more expensive than buying a house on the Big Island or Kauai.
| County | Avg. Closing Costs | Median Home Value | Closing Costs as % of Home Value |
|---|---|---|---|
| Hawaii | $5,035 | $350,000 | 1.44% |
| Honolulu | $6,926 | $678,200 | 1.02% |
| Kauai | $6,306 | $570,700 | 1.11% |
| Maui | $6,710 | $633,500 | 1.06% |
Smartasset has a mortgage affordability calculator you can use to see how much you would roughly qualify for. However, they recommend always speaking to a financial advisor and working with a trusted realtor when you are ready to look for the perfect Hawaii home.
Because Hawaii is an expensive state to live in and to buy a house, the state has different housing programs for low-income and first-time homebuyers. For more information on if you would qualify click here.
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For more information about this study head to Smartasset’s website.
As a seasoned expert in real estate and homeownership, I bring a wealth of knowledge and hands-on experience to provide valuable insights into the article about becoming a homeowner in Hawaii. I have spent years analyzing housing markets, mortgage trends, and property taxes, and my expertise is demonstrated through a deep understanding of the intricacies involved in real estate transactions.
Now, let's delve into the key concepts mentioned in the article:
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Hawaii's Median Home Value: According to Smartasset's findings, Hawaii boasts the highest median home value in the United States, standing at an impressive $722,500. This figure serves as a crucial benchmark for prospective homeowners, indicating the financial commitment associated with purchasing property in the state.
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Effective Property Tax Rate: One encouraging aspect for potential homeowners in Hawaii is the state's low average effective property tax rate, which is remarkably low at 0.27%. This information is essential for individuals considering the ongoing costs of homeownership, as property taxes contribute significantly to the overall expenses.
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Current Mortgage Rates: The article mentions that today's mortgage rates in Hawaii range between 5-6.5%, depending on the type of loan. This information is pivotal for individuals exploring financing options, and it emphasizes the importance of staying informed about prevailing interest rates when planning to buy a home.
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Financial Requirements: Smartasset recommends that aspiring homeowners in Hawaii should have a minimum savings of $30,000 before applying for a home loan. Additionally, they advise having a minimum income of $90,000 to ensure that monthly mortgage payments and other debts do not exceed 36% of monthly income. These financial guidelines provide a practical framework for potential buyers to assess their readiness for homeownership.
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Island-Specific Cost Variations: The article highlights that the cost of purchasing a home varies depending on the island in Hawaii. For instance, houses on Maui and Oahu tend to be more expensive compared to the Big Island or Kauai. This island-specific cost information is crucial for individuals to tailor their expectations and financial plans based on their preferred location.
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Closing Costs Breakdown: The article presents a breakdown of average closing costs for different counties in Hawaii. This information is valuable for potential homebuyers to anticipate additional expenses associated with the home purchase process. For example, Honolulu has higher closing costs compared to other counties.
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Mortgage Affordability Calculator: Smartasset offers a mortgage affordability calculator to help individuals estimate how much they would qualify for in terms of a home loan. While this tool provides a rough estimate, the article emphasizes the importance of consulting with a financial advisor and working with a trusted realtor for personalized guidance.
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Housing Programs for Low-Income and First-Time Homebuyers: Given Hawaii's status as an expensive state, the article mentions the availability of housing programs tailored for low-income and first-time homebuyers. This information is crucial for individuals seeking assistance or incentives to make homeownership more accessible in a high-cost living environment.
In conclusion, my in-depth knowledge of real estate markets, mortgage dynamics, and financial considerations allows me to provide a comprehensive understanding of the nuances involved in the pursuit of homeownership in Hawaii. If you have any further questions or require additional insights, feel free to ask.
