Canadians Buying In Hawaii


Calling all Canadians looking for a warm island retreat in Hawaii!

Canadian buyers pondering purchasing a home or condo in Hawaii, here are a few things to know about the process:

Some Terms

  • While most property in Hawaii is Fee Simple Property meaning you own part or all of the land that the home or condo is on. There is also Leasehold Property meaning you do not own the land, there is a fixed term on the land lease and you pay a monthly land lease fee in addition to any other expenses.
  • Strata Fees in Canada are the equivalent of HOA/AOAO Fees in Hawaii.
  • Hawaii contract “contingencies” are Canadian “subjects.” Home inspection period in Hawaii is typically 14 days. 
  • In Hawaii, Sellers often list property “as-is.” While repairs and adjustments to price may be negotiated during the home inspection contingency period, the “as is” sends a clear message that the sellers plan to do minimal work on the property during the contract period. 


It can be an endeavor to obtain a US Mortgage, even with excellent financial history and income in Canada. Having established US credit and working with Hawaii-licensed lender are key. Canadian lenders do not loan money for US investments, but they can help Canadian buyers pull equity from their Canadian homes to put toward their purchase in Hawaii. There is a typical requirement for Canadian Buyers for 30% + down on a Hawaii real estate purchase, and interest rates can be 1/2 – 3/4 point higher than for a domestic US purchaser. Before making an offer we recommend getting pre-qualified with a local lender. We work with some experienced local lenders that we will be happy to refer. Gather documentation such as pay stubs, tax returns, bank statements and proof of available funds for the down payment so they can get you pre-qualified for your loan amount before shopping for homes. Shopping in the right price range will save time and frustration. 

Fees Associated with Purchasing

Some fees in the US process that may be different than in Canada are title and escrow fees, inspection and appraisal costs, and possibly attorneys fees. Your real estate agent and lender can provide you with an estimate before you get started with a purchase. 


  • Property taxes: Property tax assessments are based on how the owner utilizes the property. Here are the most current rates for Hawaii Island, which cover from July 2022- June 2023 for Hawaii County Real Property Tax Rates. Rates vary by island. 
  • Renting your property: It is recommended that you obtain a Tax Identification Number (TIN) at closing if you plan to rent your home. If you do not have a TIN, 30% of your rental income will be withheld to ensure you pay US taxes. If your US property is used as a short term or vacation rental, you will also need to obtain a business license for collecting General Excise Tax (GET) and Transient Accommodation Tax (TAT).
  • When you sell: As a foreign investor in US real estate, you will be subject to additional taxes when it is time to sell. FIRPTA (Foreign Investment in Real Property Tax Act) tax mandates that 10-15% of the sales price be withheld at the close of escrow. When you file a US tax return and report the proceeds, any overpayment will be returned. HARPTA (Hawaii Real Property Tax Act) mandates that 5% of the sales price be withheld at closing. When a Hawaii state tax return is filed, any overpayment is returned.
  • Consult an expert: We always suggest you consult with your accountant or tax expert for advice before purchasing an investment property in the US.

Title and Escrow

In Hawaii, Title and Escrow Companies are neutral third parties who handle closing documents, provide title history, and transfer of the deed. During the contract / escrow process you will communicate with your title and escrow officer, your real estate agent, and your lender, and they will all communicate with each other. Closing timelines are typically 45-60 days when financing, Cash deals are typically around 30 days. Funds for closing can be wired to escrow. It is critical to verify the legitimacy of the instructions you receive for wiring funds. Wire fraud is on the rise everywhere. We advise speaking with your escrow officer before wiring any money.

Signing Documents

Some closing documents need to be notarized by a US Notary. You may need to schedule an appointment at the US Embassy. Plan on two weeks advance planning. If you live close to the border it may be easier to drive over the Canada-US border to sign documents in the US with a notary. Stay in close communication with your escrow officer to determine the best plan for you. 

Property Management

If you are considering renting the home while you are not on island let’s talk zoning. There are complicated regulations and restrictions and we want to be sure you are buying a home that is eligible for your planned use.  If you do not reside on the island you are required to use a licensed property manager to manage your Hawaii rental. Long-term rental fees start out at around 12%. Short term vacation rental management fees can range from 25 – 40% depending on the level of service and factors you want in the management. From small individual managers to large companies, there are many options and decisions to be made. As you talk with prospective management providers they can provide you with average occupancy rates, nightly rates, and fee structures for the specific areas and home size you are considering. 

Utilities and Accounts

County and utility companies will vary, but you may be required to send in notarized IDs or deposits to the utility companies to set up a utility account as a non-US citizen.

You will need to set up a local bank account if you are going to have rental income deposited into an account, and pay bills for the rental. There are no mainland banks on Hawaii, such as Bank of America or Wells Fargo. Some of the local banks options are First Hawaiian Bank and Bank of Hawaii and Central Pacific Bank 

If you’re ready to start your journey in Hawaii home ownership, contact us and let’s talk about the possibilities.