Honolulu Real Estate: The Coconut Wireless

As the first groups of baby boomers gracefully rides the wave of aging, they are setting new trends in the housing market, giving birth to what experts fondly refer to as the "Silver Tsunami." This phenomenon is not merely about a change in address; it's a lifestyle transformation tailored to meet the unique needs of the golden years. With approximately 10,000 people reaching the age of 65 every day, the United States is witnessing an unprecedented demographic shift. By 2030, all baby boomers will have passed this milestone. Among these remarkable statistics, the AARP's estimate stands out: a staggering 74% of total U.S. homeownership belongs to individuals over 50, with more than half of this demographic opting for downsizing their home as a strategic move. The Silver Tsunami is, in essence, a testament to the demographic strength of the baby boomer generation. Born between 1946 and 1964, this generation has played a pivotal role in shaping American soci

In recent years, home values have soared, presenting an opportunity for homeowners with substantial equity to consider a unique tax benefit. Section 121 in the IRS code allows for homeowners who meet certain requirements to exclude up to $500,000 of capital gain on the sale of their principal residence.   Single or married taxpayers filing separately can exclude up to $250,000 of capital gain.   Taxpayers must meet the following requirements: They must have owned and used the home as a principal residence during at least 2 out of the last 5 years. They should not have excluded gain from another home during the two years before the current sale. The property should not have been acquired through a 1031 exchange during the past five years. Capital gain is determined as selling price, less sales costs, less basis in the property which is the purchase price paid for the home plus capital improvements made during the tenure.  Capital gains more than the exclusion amounts are t

Many of today's homeowners have accumulated multiple high-tech "smart" devices to make their home more convenient, economical, and fun to operate.   When they decide to sell the home, they need to make the listing agent completely aware of whether they will be included in the sale of the home.   Some of these things easily meet the definition of real property because they are permanently installed like thermostats, doorbells, cameras, garage door openers, and pool equipment monitors.   A rule of thumb mentioned frequently is that if it were removed, the functionality would cease or if there would be evidence of where it had been, it is probably real property and is included in the sale. Other devices like virtual assistants made by Amazon, Apple, or Google, may not specifically meet that criteria but they are needed to operate things like electrical switches and plugs, or lamps.   It becomes a grey area of whether it is real property when TV's, doorbells,

There can be many reasons homeowners aspire to have their home paid for.   They can include no mortgage payments, financial security, debt reduction, lower expenses, retirement planning, financial freedom, legacy planning, no risk of foreclosure, and reduced stress, just to name a few. All those things have a cost attached to them which is the loss of the earning power which is tied up in an asset that only benefits the owner by appreciation.   In the past few years since the pandemic began, homeowners have experienced a dramatic increase in equity due to appreciation. As an example, let's set up a comparison of how the yield on equity decreases as the property appreciates.   A homeowner has a debt-free home worth $400,000 that is expected to appreciate at 4% a year for the next five years. The future value of the home would be $486,661 and the owner would have earned a 4% return on his investment in the property. In scenario #2, the homeowner refinances the property t

All of us encounter major life events and they have the possibility of disrupting our lives temporarily, if not permanently.    The homes we live in may have met our needs originally but due to a change in our life, it may no longer be adequate or the best fit for us, which will require a move. The decision to change one's living situation often comes as a response to these pivotal moments, and the reasons behind such changes can be as diverse as the events themselves.   The number of things that can influence these changes is numerous.    It may be the birth of a new child, or the ages of the children are getting such that you simply need more room.   Marriages generally merge two households into one.    The possibilities are endless, but it could be two single people or two single parents each with children who need the right space to blend the families. A promotion, transfer, or a new job could require a change in housing, or maybe just make it more convenient

House-hacking refers to buying a multifamily property on an owner-occupied mortgage, living in one unit and renting the others.    If you're thinking about becoming a rental mogul, starting early is an advantage.    Not only will you have longer to accumulate a larger portfolio, but you can also increase the leverage on the first owner-occupied acquisitions.   Leverage is the use of other people's money to finance an investment.    The higher the loan-to-value, the greater the leverage which can increase the yield.    The lower down payment gives the investor more leverage which can increase the return on their investment.   FHA, VA, Fannie Mae, and Freddie Mac each have programs for buying owner-occupied two-to four-unit properties with the same minimal down payment required for a single-family home.    The advantage is that non-occupant investors must have a 20-25% down payment where the owner occupant is much less. A qualified veteran could get into the first