Buying Land on Kauai | Considerations for Choosing the Right Parcel

Why Buy Land?

Living on a small island in the middle of the Pacific Ocean has limitations. With a limited supply of housing inventory, it can sometimes be a challenge to find the right house and property. Purchasing vacant land is the perfect opportunity to architect the home and property of your dreams.

Owning land can also be an excellent investment. Land is a limited commodity and will appreciate over time. Maybe your dream is to live on Kauai “one day,” but you are not ready yet. Purchasing at today’s prices will help you get a stake hold in the market and plan for the future.

This picture shows an overhead view of a parcel currently available in “Kahiliwai Ridge” on the north shore of Kauai.

Choosing the Right Parcel

Of course, finding the perfect property can be a process as well. Here are a few things to think about.

• Lot Size – It is important to consider how large of a home — lots on Kauai range from 5,000 sq ft to hundreds of acres. On “the garden island,” you will find that things grow at a rapid rate. You may consider how much maintenance you want to do, in terms of mowing, pruning, and trimming vegetation. Alternatively, you may also desire lots of space for growing fruit trees and a garden.
• Zoning – How do you intend to use the land you purchase? Some properties on Kauai are zoned Agricultural, which comes with a different set of rules, regulations, and responsibilities. As a benefit, you enjoy lower property taxes, but you must have a plan for contributing to Kauai’s agriculture or farming in some way. Would you like to have additional buildings, a guest house, or multiple dwellings? Make sure you have a property that allows for that.
• CPR – CPR stands for Condominium Property Regime. This is a common scenario in Hawaii, where a lot that couldn’t further be subdivided, but has enough room for additional dwellings, is divided into “condominiums.” There is a set of rules and regulations governing each “CPR,” drafted by attorneys and filed with the County, but there has to be some common element, often a shared driveway or green space. If you notice a property listed with a letter, number or unit after it, it is likely part of a CPR. Sometimes opportunity-seeking Buyers will find a piece of land that is not already part of a CPR, and further develop it into a CPR.
• Typography – How the land is positioned is a huge consideration. Would you like to take advantage of Trade Winds for cooling? Then you probably need to look for a lot with a little bit of elevation, or at least one that his not located in a valley. Are you looking for space for fruit trees and gardening? Excellent sun exposure will make your gardening endeavors much more fruitful. A property that is level and flat is easier to develop, and property with substantial hillside will often require a different type of foundation and evaluation of soil stability and erosion. Another essential consideration is drainage. Where does water flow on the property? This can especially be important in the consideration of where to place the structure(s).
• Neighborhood – Do you want to be in a neighborhood with similar-type homes to keep the value of yours up, or do you want to be off the grid? How close do you want to be to your neighbors? Are sidewalks and street lamps desirable, or are you okay with a gravel driveway and a more rustic feel? There are a lot of things you can change about a property, but you cannot change the location and neighborhood.
• Development Costs – How much infrastructure is already in place can make a massive difference in the timeline and cost of building. Development costs include connecting to water or drilling a well (if allowed), connecting to power, connecting to sewer or installing a septic system, installing a driveway and factoring in landscaping. This is a vital avenue to explore when considering purchasing land. If you intend to get a loan for the land (usually a construction loan), much of this infrastructure needs to be in place. Sometimes a Seller will offer a short period of owner-financing, so the new Buyer can put the infrastructure in place to get a loan and make a balloon payment to the original owner.

Street view from a 5-acre parcel currently available in Kalihiwai Ridge on the north shore of Kauai.

Getting Educated

The best way to approach any home or land search is to begin with research. You have found this article, so you are on the right track. Connecting with an experienced local agent will save you time and money by drawing on their knowledge and expertise. It can be beneficial to explore the current inventory. If you are available to drive-by in person, or at the very least have someone take a video on your behalf, you can learn a lot about a property. Then, get yourself set up on an automatic search so you will be notified when something new hits the market in your price range.

At the time this blog was written, there were currently 171 vacant lots on the market on the Island Of Kauai. They range in price from $130,000 – $27,000,000.  The median listing price is $700,000. In the last year, 178 vacant land parcels sold and closed on Kauai, ranging in price from $50,000 – $12,000,000. The median sale price in the last year was $477,000.

Whether you are looking for a large parcel, an oceanfront property, or a small urban lot for a modest house, there are a lot of options and considerations before purchasing land.  Contact us, inquiry@hawaiilife.com.