This blog series will focus on our personal journey purchasing four properties on Maui.
Upon returning home to upstate NY in the summer of 2012, we were excited about actually owning two beautiful brand new properties on the island of Maui. We decided to not go back to Maui during 2013, as we needed to put time, energy, and effort into our careers. Also, we owned a log home and timber frame home construction sales company, and we had a 5,000 square foot live-in model log home that had not yet been completed. (This was the home we re-financed for the down payment for our first purchase on Maui at Kai Ani). It was time to direct resources into putting the finishing touches on the model home.
Tip: Don’t Give Up. Find a Way to Make it Work.
Over the years, we had purchased vacant parcels that surrounded our property as they came up for sale. We decided that we would sell one of those properties, with deed restrictions to protect ourselves, to generate funds to put into the house. So, in May of 2013, we approached a neighbor that we had actually built a log home for, and asked if they would be willing to purchase land from us that adjoined their property. They said they would think about it.
Six months went by, and we completed a good deal of work on the model. In the meantime, Gina and I were really missing Maui. We told each other that if one of us found a job on Maui, we would sell everything and move. Deep down I was a little concerned about selling the log home. It was pretty big, and might not appeal to the majority of the buying market. On the other hand, we were located directly across from a major snow ski resort. Location, location, location…
In November 2013, Gina received a reply regarding a job prospect on Maui. They wanted her to come to the island for an interview. That same week, we finally heard back from the neighbor, and they informed us that they preferred to purchase the three adjoining parcels as well as the log home…the whole thing!
The job came through and all of the property sold, and we finally achieved the goal of moving to Maui. Our Realtor found us a place to rent, and we moved to beautiful Kula.
In June of 2014, we found a property for sale at Milo Court. This is a beautiful townhouse development in Kehalani offered by Towne Island Homes. The property had been purchased one year earlier, and the new owner needed to move to the mainland. Our offer was accepted, and we closed in July of 2014. We used the equity from the sale of the log home for the down payment. The property was purchased with the intention that it would be another rental property. Therefore, the same rules needed to apply:
- The property would be newer
- The property would need to be rentable
- Rental income from the property would need to provide positive cash flow
We closed on the property in about 4 weeks. The resulting numbers are as follows:
- Purchase Price: $435,000
- Down Payment: $235,000
- Approximate Total Monthly Expense: $1,674.00
- Approximate Monthly Rental Income: $2,700.00
- Approximate Positive Cash Flow: $1026.00
Be sure to read my blog “Purchasing Rental Property on Maui – Part 4” to see how we structured our fourth purchase on Maui!
For more information regarding real estate on Maui, contact:
Rick Wyffels, Realtor-Broker