Kitchens have become the primary social hub of the home. It’s become a place where friends and family come together for meals and conversation. Because of this, an upgraded and inviting kitchen can be a huge selling point in a home. If you’re thinking about selling your home in the next few years, it’s worth thinking about updating your kitchen. On average, the return on a kitchen remodel is about 70%. But in Honolulu, this remodel can give you a return of up to 152% for a minor kitchen remodel and 108% on a major upscale kitchen renovation.
In a recent report issued by Remodeling.net, Honolulu tops the nation when it comes to return on investment for home remodel projects. The most obvious reason for this is the lack of inventory on the market and the lack of upgrades since the initial construction. The median year of construction of Honolulu homes and apartments was 1971, most of which have not been changed since. Because of the shortage of newer homes, buyers seek renovated homes and are willing to pay more for them.
Below are the top 7 remodels for your money, both in the midrange and upscale markets.
- Wood Deck Addition: 164.5%
- Minor Kitchen Remodel: 152.8%
- Attic Bedroom Remodel: 136.5%
- Composite Deck Addition: 130.6%
- Window Replacement (Wood): 130.5%
- Basement Remodel: 127.4%
- Window Replacement (vinyl): 127%
- Fiber-Cement Siding Replacement: 134.6%
- Window Replacement (wood): 132.4%
- Window Replacement (vinyl): 124.9%
- Foam-Backed Vinyl Siding Replacement: 124.3%
- Garage Door Remodel: 113.5%
- Major Kitchen Remodel: 108%
- Grand Entrance: 106.6%
If you’re looking to sell in the future, it makes sense to do these updates and remodels because of the massive return on investment. Click HERE to see the full report from Remodeling.hw.net.
While browsing through the current listings I am sure you came across some beautiful condos/homes with what seem to be unrealistic prices. Did you inquire about these properties wondering if the price was entered wrong or if they are a scam?
Take for example beachfront, 1,555 square foot, 2-bed condo right in Kahala, one of Oahu’s most prestigious neighborhoods for just $120,000.
These properties are called “Lease-hold” (LH) ownership as opposed to “fee-simple” (FS). Fee-simple ownership is what you may already be familiar with. FS ownership is the most complete, meaning you own the land and any improvements made on the land.
With LH ownership you own the unit/house while you pay the lessor a monthly lease rent for use of the land. As the lessee, you don’t own the rights of the land, just the ability to use it exclusively, or freely transfer ownership for the remaining years of the lease. The lease will usually include a clause providing that any improvements such as a home or building will be surrendered to the FS landowner upon expiration of the lease.
When purchasing a LH property, as the buyer, you are responsible for property taxes, maintenance fees, a monthly lease-rent, and your mortgage, if financed. It is important to factor in all variables when budgeting and predicting cash flow.
Often times, lessors offer a “fee conversion,” where they sell their leased fee interest land to leasehold owners, so it is possible to obtain FS ownership on certain LH properties. Don’t count these properties out when consulting with your Realtor.