Honolulu County

Honolulu County sits at a median home price of $855,988 and a median rent of $3,015, producing a gross rent-to-price ratio of 0.042, or about 0.35% per month. That is well below the 0.7%-to-1% range most cash-flow investors target as a starting threshold. The modeled cap rate lands at 2.75%, and the fully loaded investment estimate, using 20% down ($171,198), a 6.85% rate, and estimated monthly expenses of $1,055, produces a monthly cash flow of negative $2,527 and a cash-on-cash return of -15.4%. Those numbers place Honolulu firmly on the appreciation end of the spectrum. Home prices rose 2.63% year-over-year, a measured pace rather than a speculative surge, but the appreciation score of 76 out of 100 reflects longer-term structural supply constraints and sustained demand. The cash-flow score of 33 and a national percentile ranking of 8th out of 1,000 counties tell the same story: this is not a market where you underwrite to income.

The investor profile here is narrow. An appreciation buyer with a long hold horizon and the liquidity to carry a $2,500-plus monthly shortfall could find a durable store of value, especially given the geographic constraints on new supply. A 1031 exchange investor parking substantial equity could reduce or eliminate the debt service drag. But a cash-flow buyer working with a standard leveraged purchase at these prices has no path to positive returns without either significant rent growth or a financing structure that isn't modeled here. There is no obvious value-add angle embedded in the data provided; the affordability index of 6 out of 100 suggests the tenant pool is already being stretched, which limits how aggressively rents can be pushed even on a renovated unit.

Hawaii's property tax regime is a genuine tailwind on the carry side. The state-average effective rate of 0.28% is very low by national standards, and the combined monthly tax and insurance figure comes to only $300, already embedded in the $1,055 expense estimate. That said, Hawaii's property tax structure is tiered, with investor-owned and non-owner-occupied residential properties often assessed at higher rates than owner-occupied homes, so the state-average figure of 0.28% deserves scrutiny at the county and property-class level before you finalize your underwrite. The low rate is a real tailwind, but confirm the investor-class rate applies to your specific asset type.

The most direct risk here is leverage sensitivity. At a 2.75% cap rate with a 6.85% cost of debt, you are buying negative leverage by definition, and the only way that resolves favorably is through price appreciation or a meaningful compression in rates. A 100-basis-point increase in cap rates, all else equal, would represent a material erosion in asset value. Concentration risk is also present: Honolulu is Hawaii's dominant economic hub and accounts for roughly 1,010,100 residents, but the state's economy is exposed to tourism cycles and federal spending, both of which can contract quickly. The data does not provide vacancy or crime figures, so no claims are made there, but an investor should independently model a scenario where rent growth stalls or reverses.

Compared to its three neighboring counties, Honolulu occupies a middle ground on price. Hawaii County (the Big Island) comes in at $557,666 with a rent-to-price ratio of 0.056, the best of the four, and an overall score matching Honolulu's 43. That ratio is 33% higher than Honolulu's 0.042, meaning Hawaii County is materially closer to breakeven on a leveraged basis. Kauai County at $996,888 and Maui County at $993,613 are both more expensive than Honolulu, with rent-to-price ratios of 0.043 and 0.041 respectively, and overall scores of 34 and 27. Honolulu wins over Kauai and Maui on every investor-relevant metric in this dataset. The case for choosing Honolulu over Hawaii County rests almost entirely on market size and liquidity: Honolulu's 1,010,100-person population creates a deeper tenant and buyer pool, which reduces vacancy risk and exit friction. If cash flow is your primary underwriting criterion, Hawaii County is the stronger choice on the numbers. If you are optimizing for asset liquidity, resale depth, and a 76-rated appreciation profile in a supply-constrained metro, Honolulu is where the data points.