All Forum Posts by: Bryan Vukelich

Hi @Cole Schlack - here on O'ahu, if priced right, STR's are still going under contract quickly. Not too long ago I represented a buyer where she put in an offer on a unit at the Ilikai the first day it hit the market. Seller required my client's initial earnest money be non-refundable if he accepted the offer, otherwise he was going to wait a week before reviewing offers and it was very likely they would have received multiple offers.

Regarding the recent regulations - Bill 41, a judge recently issued an injunction on the 90 day minimum so any owner can continue doing 30 days rentals (as long as the building association allows it). And on October 24th, the registration portal for STR's went live, and surprisingly it seems to be going rather smoothly. The DPP is giving conditional registration approval once an owner submits the required documentation since it will take time for them to review all the docs. Fee to register is $1000 and is nonrefundable.
 

Best regards, 

@Ryan Ino - my pleasure and glad that info was of value to you.  Lots of rain in Kane'ohe today - hope your side is drier.  Contact me any time if you think I can be of help. 

@Ryan Ino - Yes, other than Bigger Pockets there are some great resources on YouTube - King Khang has some very helpful videos - especially some of his older ones.  But he is not the only one, I recommend going down the rabbit hole and watching other wholesaler channels as well to see who/what resonates best with you.  Along with that, I recommend the following:

* For liability reasons, I'd create a business to run your wholesaling business through. My brother and I used an LLC but recommend you talk to an attorney for best structure.

* Create a purchase contract  - recommend you have an attorney review it to protect your interests.

* Create a assignment agreement - also best to have attorney review.  (you might find a wholesaler who will give or sell you his/her purchase contract and assignment agreement)

* Network, network, network - deals can come from anyone.  Ask people if they know some who is interested in selling.  

* Build relationships with home builders and real estate investors - anyone who might be interested in your wholesaling deals. 

* You'll need to cold call if you want to succeed in wholesaling but I am also a fan of online marketing  - so much nicer to have a "warm lead."  So you might want to create either a legit website or just a landing page to capture online leads.

Good luck and happy to answer any other questions you have, 

Hi @Jessie Bayudan - I suggest you contact my brother, @Brandon Vukelich if you are open to investing in W. Washington St area - he has many years of real estate investing and helping other acquire investment property and has a solid team established.  If I can be of value to you in any way here on O'ahu, contact me at any time.

Best 

Hi @Yna P. - overall, most of the feedback on Bill 41 that effects STR's on O'ahu seems to be very negative and the only ones who truly support it is the hotel industry. For the "local little person" who is having a difficult time keeping ahead of the rising costs of living, as well as an employment market that overall has mostly low paying jobs, operating STR's was a nice way to supplement their income - plus is also helped increased property values. So having to do 90 days rentals now outside of resorts areas is a detriment to many people.

Other issue is that if you own a STR within a resort area on O'ahu where STR's have operated legally for years, now with Bill 41, effective Oct 23rd, 2022, owners are required to register their unit with the Department of Planning and Permitting and obtain a registration number before they can legally operate as an STR. There is a lot of uncertainty whether DPP will have the registration in place by Oct 23rd, and if they don't, what will happen then but more lawsuits against the bill wouldn't surprise me.

All in all, the gov't has created a mess.    

My pleasure @Michael Baum - and yes, inventory for STR's on O'ahu is very tight right now and still a lot of interest from buyers.

Hi @Michael Baum

For Waikiki Sunset, monthly AOAO fee is about $950 and covers:  AC Central, Electricity, Hot Water, Sewer, Water and property tax is about $180/mo.  

For Ilikai, monthly AOAO fee is about $575 and covers:  Cable TV, Hot Water, Sewer, Water and property tax is about $750/mo. 

Property insurance is under $1k annually and marketing expenses depend on whether you self manage or on the management company.  Hotel operators usually bill owners for marketing costs, while some 3rd party management companies charge that to the guest. 

Happy to answer any other questions you have.  

Aloha @Sam Booth

I wanted to chime in as you have been getting some misinformation from other members though @Mark Waite provided good advice. Personally, I have and currently work with many investors looking for legal STR's and some of my clients are also looking for opportunities on Maui and Big Island. In the past 40 days, I've had 2 clients close on STR properties in Waikiki where the numbers looked quite attractive. For O'ahu, it is completely possible to buy a legal nightly rental building and be cash flow positive. Below is some key info it is best you are aware of.

* STR's can legally operate in Waikiki, Turtle Bay, Ko'olina and Makaha if the property is in the hotel/resort district AND the AOAO allows for short term rentals.

* If you need financing, best you work with a local lender that is familiar with STR units. However, most conventional lenders will not finance a unit that does not have a stove/oven. If you are interested in a unit that only has a kitchenette, I do have relationships with lenders who will finance it but the rate is considerably higher. You will need at least a 25% down payment.

* I have a relationship with a highly rated STR property management company. They charge 20% for full service and handle all marketing, cleaning, maintenance and will pay the GET, TAT, and OTAT tax on your behalf.

* GET, TAT, and OTAT taxes are paid by the guest.

* I recently had a client buy a beautiful 2 BR for $715k at Waikiki Sunset. This building was approved for STR's in Bill 41. A quality STR management company thinks it will gross $7-$9k/mo in current market.

* I also had another client buy a STR at Ilikai for $575K. It is expected to gross $4200-$5500/mo in current market.

* In currently market, you can buy a well maintained 1 BR in $550-$650k range and it will likely gross $5-$6k.  To get an idea of units and highly rates, I recommend you visit Alii Beach Rental website.  

* I have clients who live on the mainland but are self managing their property to avoid paying a PM fee.  Obviously this greatly reducing operating expenses. 

* VERY IMPORTANT: The STR market is in a period of uncertainty. Bill 41 is scheduled to go into effect Oct 23rd, 2023. Due to this bill, STR owners are supposed to register their units with the Department of Planning and Permitting (DPP) to obtain a registration number in order to legally operate their STR. At this time, it looks like the DPP will not have the registration process in place by Oct 23rd. There is uncertainty what will happen then. For this reason, I'm advising my clients to wait to buy an STR here until we see how this all plays out - unless they have high risk tolerance.

Happy to answer any questions you have - I am here to serve you.  

Hi @Damequia Montgomery - I agree with @Michael Borger that a great way to start as a beginner is wholesaling.  But unless you get very lucky, best to understand that it is quite challenging to find wholesale opportunities.  But if you are persistent with cold calling, driving for dollars, door knocking, and I also recommend online marketing, you'll eventually come across some opportunities.  And I recommend you spent time on BP discussion boards asking people about their experience regarding wholesaling and YouTube also has some great channels for wholesaling.  I've known quite a few people who have tried it but get burned out quite quickly.  

Also, if you haven't done so already, I recommend you invest a lot of energy learning more about real estate investing via books, BiggerPockets and networking with other investors.   Even though you don't have a lot of money at this time to invest in a property, $18k is still a good start, and through networking, you may be able to find others who will invest with you if you find an attractive opportunity.  

I enjoy talking real estate and helping people achieve their real estate goals - you're welcome to contact me if you think I can be of service to you.

Best, 

@Micah Casey, I will try to get you a correct answer today from the Department of Planning (DPP) but based on what I know, I am quite sure it would be illegal to do any short term rentals with any property that is not within a resort area and which is approved for short term rentals.

If you'd like to try calling the DPP yourself, number is 808 768-8000.  

Just curious if you want to share, what buildings you currently have vacation rentals in?  

Follow up with you once I have more info.