What You Should Know Before Investing In A Condo In Kona

Thinking of making Hawaii home? Whether your plans include a few months of the year, or a full time basis, investing in a condo may be the perfect lifestyle for you. However, condo living in Hawaii may be a bit different than anything you’ve experienced on the mainland. Here on the Big Island, Kona is always in demand as a vacation paradise. And with many great options available, it may be the perfect place to turn to when making your final decision. Yet before you settle, keep these things in mind:


Here in Hawaii, every condominium development must have an AOAO (Association of Apartment Owners). This association is created from existing condo owners, allowing them to be responsible for running and maintaining the complex. As a homeowner, you will get one vote to determine how the complex is managed and who will take responsibility for maintaining the property.

At a minimum, all AOAO fees will cover maintaining the condominium’s common elements – the grounds, pools, the building exterior, roofs, etc. Some cover much more.

In order to determine if the condo’s fees are appropriate for the service given ask yourself:

How much are the operating expenses for the building?

How is the budget determined?

How are reserves set and maintained throughout the year?

Has the AOAO’s system worked effectively in the past?

Your realtor should be able to provide you with adequate answers up front. However, keep in mind that AOAO details probably won’t be released until your offer has been accepted and you are in escrow. Be sure you set ample time in your contract to review and ask any questions you may have.

Rental agreements

Hawaii is heavily built around tourism. As such, a lot of the condominiums have features built to add value to those that want to own as an investment property, making money when they aren’t using it as a second home.

In some cases, you may choose to manage the rental process yourself, or hire a private company to manage it for you. In some cases, the AOAO provides the details of the rental process either through an onsite company owned under the AOAO, or by one hired to manage the details.

Because this can have significant impact on your home ownership, make sure you understand what is included in the agreement, and what you will be in charge of, no matter how often you spend time within your unit.

Understand leasehold versus fee simple

Here in Hawaii, we have two types of property ownership: leasehold and fee simple.

Fee simple is probably what you are most familiar with when coming from the mainland. You own your dwelling and the land underneath it.

Leasehold, however, is a little more complex. Within a condominium complex, you would own your individual unit, while collectively all condo owners would own the building. However you wouldn’t own the land underneath it, and would make a lease payment on the land each month to someone else.

The risk comes from the due date of the lease. Once it comes up for renewal, you must negotiate with the land owner about a new lease agreement. If property values have skyrocketed, you can expect the lease amount to rise accordingly. To offset these risks, leasehold properties are often lower in price than their fee simple counterparts. To make sure you have all the information necessary to understand these nuances and find the right property for your circumstances, be sure you find a realtor that can help you navigate all that Hawaiian law brings to the table.

Have any additional questions about owning a Kona condo here on the Big Island? Give me a call today. 

Annette Mejia, Realtor Broker
Annette Mejia, Realtor Broker

"Everything Annette did for me was from the heart"

As someone that has spent her whole life feeling lucky to work with people in customer service, I vowed then and there to help people like you and me have the experience they deserved when moving to The Big Island. Because let’s face it, this should be the start of the happiest, proudest, and most peaceful period in your life!

For 15 years I have been helping people make the most out of life and real estate on The Big Island and I would be honored to do that for you too. I look forward to meeting you!

Warmest Aloha,
Annette Mejia

Live On The Big Island