Category Archives: Hawaii Real Estate

Hawaii is Paradise, and it doesn’t come cheap. This is where Uncle and Aunty were born, raised, and will live for the rest of our lives, so we want to own our piece of the islands. It is more challenging, but worth it.

Peter Savio for Governor!

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We are like frogs in a pot of water that is slowly being heated up until the point of – well, you know what.  We can see and feel how our island home and culture are changing as our values and lifestyle are slowly disappearing.  That makes me sad because I am local and feel blessed to be here, and other locals feel the same but either cave in or move away.

One of the points that Peter Savio points (sorry for redundancy) out is that our local neighborhoods currently have 20 – 30% non local occupancy.  My real estate daughter challenged that number and asked where the data is.  Not sure where he got those numbers but I believe if you just look around your own neighborhood (mine is Kaimuki), the influx of “new” people replacing locals is right around 20%, maybe more.  It’s not that these people are bad.  They aren’t – but their upbringing and history clash with ours and they are initiating unconscious changes.

And there are more coming in to replace locals who are either dying off or moving away.  Peter says when the mix is over 50% non local (he predicts 10 years), then we have lost the Hawaii that we know and love, and we really need to keep locals here and not force them to move away because of the costs of housing and our lack of good jobs.  Demand based, rather than Supply based housing should bring the cost of homes down to $450 instead of over a million dollars, and then the local families don’t have to move away from here.

He mentions how Singapore leaders and planners came to Hawaii in the 60’s to learn how to make Singapore a vibrant country because they were dirt poor and struggling, and they took it back and with the Hawaii plan in motion, changed Singapore into the vibrant and rich country it is now.  He asks why Hawaii didn’t continue what we had and instead became what we are today.  He does NOT advocate that we follow the Singapore model (heaven forbid that we have concrete and glass jungles that replace our paradise) but that we go back to the Hawaii plan and implement it by keeping the monies generated by industries such as solar farms, etc in Hawaii and not allow outside interests to make the money and take it back to the mainland, and foreign countries.

Limiting out of state investments is what is needed but this is countered by those in power as “illegal” and “unconstitutional”.  That is the easy answer so the root of the problem is not addressed.  It can be done so it is legal and constitutional with the right words to use and disincentives.

Anywho, I am ranting because I worry for out future generations and am very troubled that we are losing what is near and dear to me about our beloved Hawaii.  True that I am old and will die sooner rather than later but I feel we owe it to our islands and island people to keep what we have rather than have it all slip away.

Please watch if you also care.  It is a half hour program but I hope you can take the time to listen.  If only our politicians and others in power care enough to keep Hawaii Hawaii.  I can hope, right?

Another Ala Moana Hotel update

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First Circuit Courtyard

First Circuit Courtyard

2 days in a row!  Normally I wouldn’t have reported about the owners’ meeting except that it had the insurance tip and my rather impulsive decision to run on a board/committee.  Am still mulling over the wisdom or dumbness of that, but it is just for a year, and a year speeds on by.

Back in October of last year, Aunty went to an auction for one of the units at the Ala Moana Hotel.  Her bid price was beat by $1000 by a woman and her son.  Judicial foreclosure auctions consist of 2 parts – the first was this initial auction.  After a period of time, the results must be confirmed before a judge, at which time additional bids can come in to challenge the last bid price.

Today, Aunty went to the confirmation hearing of the unit that she was beat on – not to challenge, but to learn about the process.  If Aunty did want to challenge the last bid price ($156,000) from the October auction, she would have to bid at least 5% more ($7,800 more = $163,800) and have at least 10% of the bid up to price in the form of cash or cashier’s check as proof to the commissioner in charge.

This unit was well worth $163,800 because prices have been appreciating in the Ala Moana Hotel.  Okay, to be absolutely honest, Aunty was running a little late for the 9:00 a.m. hearing at the First Circuit Court and didn’t have time to get a cashier’s check just in case she had a change of heart and wanted to challenge.  However, this wasn’t too much of a downer because Aunty also remembered that the lady who bid was an older woman that looked nice, and not really someone she wanted to challenge.

So Aunty parks at her credit union across the street, runs toward the Court building on Punchbowl Street, gets a little lost on the 4th floor, and enters a very small courtroom full of people.  Seeing the commissioner in charge of this auction, Aunty squats next to her, and we wait for the judge, who was late.  This confirmation hearing time was for several judicial auctions, not just the one that Aunty was interested in.

The first case called up was for a property in Waianae.  The bailiff or judge read off the details, the plaintiff (I suppose that is the one who won the initial auction) acknowledged their presence and the commissioner in charge of the sale stood next to them before the judge.  The judge then asked if there were any challenges to the property (i.e. any bids over the last bid price), and someone in the bandstand raised their hand.  The judge then called for a delay in that case until the interested parties conferred and met outside of the courtroom.  Those people stepped out, and a mini auction between any of the interested parties took place, the winner of that auction would then get to be confirmed by the judge later in the proceedings that day.

So exciting!

Up next, was the Ala Moana Hotel unit that Aunty had her eye on.  The winning bidders must have hired an attorney to represent them because a well suited young man stood as plaintiff for them next to the commissioner, and when the judge asked if there were any challengers to their bid, no one raised their hand.  That was a surprise, but good for the nice looking lady and her son.  The sale was confirmed, and the property would be theirs after all the funding, escrow, etc. were finalized.

Aunty followed the commissioner out of the room, and then saw the woman and her son.  She looked like she had aged 10 years.  Aunty was glad that she did not challenge them.

So, that is the auction update from start to almost finish.  It took almost 3 1/2 months for the confirmation hearing to be held from the auction in October.

Aunty will now feel a bit more confident in bidding at these – for the right property at the right price.  It was a really good learning experience.

 

 

Owner meeting at the Ala Moana Hotel

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Ala Moana HotelAunty attended the 2017 Ala Moana Hotel Condominium Annual Meeting yesterday, very curious to hear from the new owners from the Mantra Group, and to talk story with fellow owners.  After the meeting, an Owners’ Forum is held, and following that, an after meeting party in the room next door with food, music, and drinks.

There are 1100 rooms, 90% of which are owned by people like Aunty, who rent them out using the hotel pool management (with a very steep 60% management fee).  The rest of the owners either live there, use outside property management companies or self manage/clean/book the rooms themselves.

Tip of the day

Sue Savio spoke about the insurance that the hotel provides.  We are in good hands, except she spoke about each owner’s need to contact their insurance agent and purchase HO6 insurance for our units – which will cover loss of income if a disaster causes our rooms to be unable to book.  At $175 – $200 per year, this is indeed a great piece of advice for anyone who has rental income.  Mahalo Sue!

Aunty at bat

There are 6 directors, representing apartment classes.  Five of these directors are pre-determined by the hotel owners (Mantra Group), and the only one that unit owners can vote or run for is the Hotel Apartment Class, even though the nominee for that position had also been pre-determined by the hotel.  This is very confusing to Aunty, who was edged on by Babs, her neighboring seat mate, to run for the director position.  No way did Aunty want to be a director, but Aunty was assured that even if everyone in the room voted for Aunty, she still wouldn’t get in.  It would be a testing of the controls that have been in place, so with nothing to lose except a bit of embarrassment.  Aunty accepted the nomination, did a short little introductory speech, and ran against the incumbent-already-chosen director, and lost.  Very badly.  The incumbent had 26% of the votes, Aunty had 3%.  Humble pie that didn’t taste too bad since it wasn’t something that she wanted, though the results were even more confusing.

Another owner asked for hard numbers rather than percentages.  There were about 70 owners in the room, we each had a paper ballot that had the names of the two candidates, and 3% would have represented only 2 votes for Aunty.  The presiding officer declined to give hard numbers, insisting that percentages were the only gauge to be reported and used for determination of results.  Babs was right – no one except the one pre-chosen by the board would be elected to represent the owners.  Interesting, and rather sad.

Aunty bats again

Minutes of the previous annual meeting were approved, an auditor was appointed, a resolution regarding rolling over account balances to the following year was passed, and another election for Class Committee Elections were held.  Again, committee members of 5 classes were already pre-determined and made up of directors already on the board.  The 6th class was the Hotel Apartment Class, and Aunty, Babs, and a nice young man named Kamil were nominated, and by default (3 positions and only 3 nominees) elected to the committee.

Why did Aunty run?  Not sure, but it will be an interesting year of possible frustration or revelations.  Committees have no voting power or say in hotel decisions.  We do not get paid, except maybe we are fed at the quarterly meetings.  Mantra Group could be an improvement over the old hotel owners, Outrigger.  Hopefully so.

Start with connecting

One of the elements missing with hotel unit owners is communication.  Babs has started an email/contact list and has asked that her contact info be posted on the newsletters that go out to all the owners.  Feedback, concerns, criticisms, as well as appreciation can be gathered and presented as a voice of the owners.  The owner base is a mix of local, mainland, and international people.  Some owners live in their units, some stay for a few months and then rent it out the rest of the year.  Most of us rent it out with occasional stays (that are free for us).  1000 potential new acquaintances, each with their own story.  Quite fascinating, yes?

The after the meeting  party was quite nice.  A great time to eat, drink, and meet people.  Willee of the Owner’s Relations Dept was there, the effervescent Suzanne Alawa of the AOAO,  and an old high school classmate in charge of catering, Candace Fujioka, was a surprise meet.  The food spread was just right, and as Aunty started delving into grabbing a wonderful looking mini pot pie commemorating the new Hawaii/Australia partnership (Mantra Group is based in Australia), a text from #1 daughter asked about feeding the family dog since she would be out until later.

ToshiDog comes first

Bummers, Aunty could not mingle and eat, but did manage to take home the cute little pot pie with Hawaiian and Australian flags, a bag of macadamia nuts, and a delicious little fruit tart.  It was all ono.

That and the meeting left a good taste in Aunty’s mouth and heart.  The new ownership of the Ala Moana Hotel will be good for us and good for them.  And that, as Martha Stewart likes to say, is a good thing.

 

Ala Moana Hotel auction and update

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auction

Tuesday’s auction on the Courthouse lanai

Aunty was again at the Courthouse steps (actually it is the lanai fronting the courthouse) to try her hand at bidding for an Ala Moana Hotel room unit this Tuesday at noon.  The foreclosure notice was found in the classified section of the Honolulu Star-Advertiser – the bank was due $215,458 with arrears, late charges, etc.

Aunty went to its Sunday open house about a month ago, met Jenny the commissioner in charge there, and decided to attend the auction.

Fortunately, Aunty’s credit union is just across the street from the Courthouse, so it was easy to stop there earlier in the day to withdraw a cashier’s check for 10% of the max of what Aunty might be bidding.  (All that is required of the winning bidder on the day of auction is 10% of the bid.  The rest of the bid is due after the closing.)  Proof of funds must be verified by the commissioner, so Jenny took Aunty’s name, phone number, and noted the proof of funds on her worksheet at noonish of the auction day.

After all prospective bidders were signed in on her worksheet, Jenny read off the conditions of the property being auctioned, as well as general rules and procedures.  Then, without much ado, the auction began.

Whenever banks or associations are involved in foreclosures, they try to recover what is owed, and so they bid the total sum due, and then they own the property.  To Aunty, this seems like a matter of them moving the asset from one pocket of what they are owed to the other pocket of keeping the asset for themselves.  Like paying yourself off on behalf of yourself.

So the opening bid was by the bank – for $150,000.  Hmmm!  That was interesting, and also left some room for us regular people to bid.  Aunty dove in at $155,000, hoping no one else would bid.  Sadly, someone did, at $156,000.  A fair price for the unit would have been $160,000, but Aunty looked at the woman bidding, kinda liked her, and so the auction went going, going, gone to the lady for a very nice price for a rather good unit.

Hawaii’s judicial foreclosures require a confirmation hearing before a judge so this was not the end of this auction.  At the confirmation hearing, bidding can begin anew if anyone decides to start a new bid at 5% over $156,000.  Hmmm.  Aunty just might go to that confirmation hearing just to watch and learn more about the process.

Meanwhile, how is the cash flow from the Ala Moana Hotel?

Aunty had posted about “Buying a piece of the Ala Moana Hotel” back in April of this year, and this is an update of how it has been doing.  It has been doing pretty well!

Some months like April and May are rather sparse, and months like February and August are very good.  Property taxes are paid semi annually, working out to be about $200/month.  So, on average, after the AOAO of $800/month, property taxes, and the hotel management fees of 60% are taken from room rentals, Aunty averages about $800/month, net.  ROI (return on investment) is 6%.  Not that great, but not too shabby, especially when compared with the piddly rate of return on savings accounts.

Changes in the works

In July, the hotel ownership changed from the Outrigger Hotel chain to an Australian firm, Mantra Group.   This may be good for us – though not sure how much they will shake up the existing structure of management and employees currently still in existence at the hotel, or if hotel rates will change, or what new ideas and policies will be implemented.  The Mantra Group does seem to want to woo owners with making us feel special, offering 50% off parking services while staying there as well as discounts to other hotel chains under their umbrella.

One very evident improvement is an art gallery/store next to Starbucks in the lobby.  For years that glassed store space was covered up and vacant, and now it looks beautiful with quality merchandise reflecting the diversity of things Hawaiian.

More?

If Aunty could, she would buy more units.  The 07 and 26 one bedroom end units have a mini kitchen complete with a cute dishwasher, but are priced over double of the studio units and have a higher AOAO.  These would be perfect for people who want to stay in Hawaii for a couple of months, and then rent out their units when they are gone.

The studio units in the Kona Tower are the least expensive, with poor views on the mountain side, and these views will get worse during the next year because of construction for the 45 storied Kapiolani Residences that is soon breaking ground.

Units in the Waikiki Tower are more expensive and quieter.

No matter which unit, the amenities for all are the same, and the advantage of being right next to the Ala Moana Center is wonderful and convenient.  Target (Aunty’s favorite!) will be a new neighbor in the old Nordstrom wing.  With all the new condominiums coming up in Kakaako, this hotel will be less congested and more desirable than there, or Waikiki.

It would be great to have more units in this hotel, so Aunty will keep on watching and jump in again if possible because it is reasonably priced cash flowing real estate in a great location.

Please let Aunty know if you get a unit in the Ala Moana Hotel, and we can meet at their annual owner meeting!

Jan 2017 update:  Aunty tried to win at another auction last month.  The bank representative started off the bid just below Aunty’s planned target price, so Aunty bid above him, and THEN! da buggah shot Aunty down with a bid $20,000 higher than Aunty – what a rotten buggah to tease with the low opening bid.

Also, cash flow from the “cheaper” units in the Kona tower is dropping.  Perhaps the new owners of the hotel operations (Mantra Group) are offering cheaper booking rates to contract guests.  It is affecting the monthly cash flow for these units, in a junk way. 

Towards the end of 2016, fewer and fewer units in the hotel were available to buy because the offerings were being snapped up like hotcakes.  However, this trend of lower rental income might have current owners dumping their units on the market.  The Ala Moana Hotel Board meeting is scheduled in February.  It will be interesting to see and hear from the new owners, and Aunty will definitely be there.

 

 

 

Buying a piece of Ala Moana Hotel

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2015-10-12_21-01-08Aunty used to go to a lot of marketing events at the Ala Moana Hotel, parking at Ala Moana Center by Macy’s, which was a no-no but everyone did it without any hassle.  From there, a short walk up a ramp took us into the ballroom section of the hotel.

Rumours Night Club just off the lobby is a hoot!  Aunty is not into the nightclub scene but decided to join some friends years ago during the happy hour.  We had pupus and cheap drinks and the place was packed with gyrating, happy dancing hipsters.  Old hipsters.  Even some really old hipsters dancing and enjoying themselves in the dance cages until the clock struck 9:30, when it changes over to a swinging place for young people.

Besides Rumours, the pool bar, some good restaurants and hotel amenities, the Ala Moana Hotel is such a convenient place, right smack next to the Ala Moana Shopping Center and the Ala Moana Pacific Center where Salon 808 and Aunty’s former hairdresser Quyan are housed.  The hotel always seems busy and vibrant.  The lobby is open, bright and clean.  Various airline crews are there for their layovers because prices are reasonable and access is easy.  This hotel is out of the hustle and bustle of Waikiki and neighbor island locals like it.  The entire hotel is smoke free and the property is fee simple (as opposed to leasehold).

About 10 years ago, this hotel was condo converted and employees were given the first option to buy.  Units began selling for $85,000 and up.  Current prices range from $145,000 up to $498,000, depending on size (246 sq ft – 559 sq ft) and desirability of individual units.  AOAO (building association) fees run from $794 – $1130/month and property taxes range from $174 – $259/month.

One could choose to live here part (or all) of the time and rent out the rooms the rest of the time.  This could be done by managing your own rental – finding tenants, collecting rents and fees, cleaning on a regular basis, maintaining the unit up to hotel standards and conformity.  Or, you could find a property management company and arrange for them to do all the work for fees ranging from 15-40%.   Joining the hotel management pool would be the easiest option – though at a cost of 50% of rental income and 10% management fee.  The term of rental agreement is for 5 years with initiation fees of $400.  Even with these high hotel management costs, Aunty heard that the cash flow is good.

Testing waters

Aunty contacted Noreen Ho, her mortgage broker who also is a real estate agent about buying a unit.  Noreen is hard working, very knowledgeable, and easy to work with.  Within minutes, Aunty had a list of 48 units currently for sale.  That is a lot of units for sale, but it is a big hotel with 1100 rooms/suites.  She also gathered rent rolls for the units that were potential purchases.  They all cash flowed!

Why would people sell their units if it is so convenient, well maintained, well run, and cash flows?  Seller disclosures do not reveal any negatives, so it is a curiosity as to their reasons, and Aunty wades in cautiously.

The visit

lobbyNoreen met Aunty at the hotel’s front desk and received a pre-arranged one hour pass to see 2 units of interest.  The lobby was busy with a line of people waiting to be registered.  We were informed that the hotel was sold out for the day, and that it has been a very good and busy year for bookings.

A very nice bellhop stopped to chat with us and we discovered that overnight parking at the adjoining Ala Moana Center was not allowed because the parking was closed after hours and re-opened at 5:00 in the morning.  Hotel guests needing parking are charged $20 per day for basement parking or $25 per day for valet parking.  Metered parking around the streets were also available, though on a first come first served basis and subject to feeding the meters during the day.  Residents of the hotel can purchase parking passes at a discount.

Just around the corner from the front desk is the real estate office of Jack Tyrell & Company.  We picked up a handy info sheet that he provides with all active listings in the hotel as well as recently sold units.  As of 10/11/2015, 44 units were available for sale and 35 units had sold in the last 6 months.  Jack Tyrell is the listing agent for approximately 25% of the current units for sale.  On a subsequent visit, Aunty dropped in and had the great pleasure of meeting Julie – super nice lady and so helpful.

Days on market of current listings range from a few days to 300 days.  Units are not flying out the door, but they are selling at an average rate of 6 per month with new listings at the same rate.

Touch and feel to decide

It was good to see the hotel and walk the halls.  It is not luxurious but it is very pretty.  The hotel card key is required in the elevators to access the different floors for security.  The elevators are clean and bright.  The hallways are clean.  An ice machine and drink vending machine are located close to the elevators.

Waikiki Tower, Unit #1

lanai 1701The first unit we looked at was in the Waikiki Tower on the 17th floor close to the elevator, with a lanai overlooking the Ala Moana Center parking lot.  This was rather nice – being high up meant a wider view with a sense of privacy.  The view from the tiny lanai was of downtown Honolulu and Ewa side, with a number of construction cranes in Kakaako – evidence of the condo building boom that is overtaking the area.

The room was a mess because it was recently vacated and not yet cleaned for the next guest checking in.  Still, it felt pleasant.  The entire hotel was going through renovations, floor by floor, and this room had brand new carpets and clean neutral walls.  The furnishings and built ins were of good hotel caliber, the bathroom was decent and average.  It was 297 sq ft and priced at $177,000.  We were in contract (in escrow to buy) at the asking price.

1701Rent rolls were pretty good, to Aunty.  (note:  Aunty has been advised in the past by several real estate “gurus” in Hawaii that there are far better deals than the ones we were considering and then bought.  However, time and cash flow has been kind to us, even though we did not follow the “gurus” advice.)  In 2014, revenues for the room totaled $46,690.25 with deductions and expenses of $37,854, resulting in net annual income of $8,836.25.  The majority of the expenses was the 60% (yikes!)  to the hotel pool management.  It was vacant for 75 days last year.

To most seasoned investors, these are not great numbers.  In fact, they might even say that they are poor numbers resulting with a ROI (return on investment) of 5.13%.  (Revenue of $8836.25 divided by cash investment of $172,000 = ROI of 5.13%)

Real estate pros and gurus usually will not settle for less than 8% ROI.

Waikiki Tower, Unit #2

2126 kitchenThe second unit was on the 21st floor, a 1 bedroom suite on the Atkinson side of the building.  It was very very nice and looked brand new.  The “parlor” had an almost full wall kitchen with even a small undercounter dishwasher.  A new comfy sofa could be pulled out to be a bed.  The parlor could be closed off for privacy from the rest of the unit which consisted of a good sized bathroom and a bedroom with a building corner lanai.

The view was less than nice – unless seeing the messiness of Kapiolani Boulevard, ugly buildings, and street traffic is your cup of tea.  The view of the Convention Center did look nice, along with a peek between the Yacht Harbor Towers and the YMCA, revealing the charming boat harbor fronting the Hawaii Prince Hotel.  This charming peek will soon disappear once the new owner of the YMCA property commences construction and builds their planned high rise.  The lanai was also very breezy – too breezy for Aunty’s dry eyeballs and fly away hair.

This unit was priced at $345,000 and felt spacious with its 503 square feet of living area.  This unit is not in high demand in the rental pool because it costs more for guests to book ($259 per night for this suite vs $149 per night for the studio rooms).  In 2014, it was vacant 110 days.  Still, it did manage to cash flow (actually almost anything will cash flow if the unit is bought with cash) at $8346.60, slightly less than the same net annual income as Unit #1.  The ROI was rather sad in comparison, a piddly 2.4% (revenue of $8246.60 divided by cash investment of $345,000 = ROI of 2.4%).

Kona Tower side

Noreen and I were curious about the Kona Tower units.  These were the smallest units – studios with 246 square feet of living space, no lanais.  Units in this Tower have the lowest sales price and lack of scenic view.  They also have the lowest booking prices for guests.  This should make it cash flow better than units in the Waikiki Tower since they would be the first to be booked by travelers looking for hotel deals.

We accessed from the left side of the lobby area, through a corrider and past the Business Center by following some tourists into the elevator and exiting on the 7th floor. There are only 13 stories on the Kona side.  Rooms are numbered from 33 to 63, with #48 corner unit rooms facing downtown/Ewa and #49 unit rooms facing Ala Moana Center and the ocean.  These corner units may seem appealing (we did not go in to see them) but they are at the farthest point from the hotel elevators, 14 rooms down from the ice machine/elevator junction.  The hallways in the Kona Towers seem narrow and the ambience of the lighting and walls make it feel motel-like.

Based on rent rolls that Noreen secured for one of the units on the 13th floor, the 2014 ROI for this $170,000 246 sq ft studio was 4.35% (revenue of $7404.95 ÷ $170,000 = ROI of 4.35%).  It was vacant for 65 days in 2014.  The lowest list price of $145,000 was for a studio unit in the Kona Tower.

Analysis

Experts and investors will probably judge these as not great investments.  Even the employees of the Ala Moana Hotel that bought in years ago when it was first offered for sale in the condo conversion have not been thrilled with their purchase as an investment.

There are factors that are out of our control which could negatively affect the cash flow – low occupancy, repairs that cause vacancies due to being out of order, renovations, rising management costs, downturn in the economy, disasters.

If a unit can be purchased for a lower price and occupancy rises, the ROI increases.  If the hotel becomes more desirable to investors, the sales price could appreciate and a tidy profit could be made in the future.

Financing as an option

If an investor does not have the cash for the entire purchase, Finance Factors will provide up to 60% of value as an investor loan.  The current rate is 4-4.5%.  Securing financing for these will add a monthly expense in the mix, dropping the amount of cash flow.

Running the numbers for Waikiki Tower unit #1:  the purchase price of $172,000 and annual net cash flow of $8836.20:

a 4.5% loan on $103,200 (60% of purchase price) will result in mortgage of $523.  $523 x 12 months = $6276

Cash flow is reduced by the monthly payments to the bank, resulting in annual net cash flow of $2560.25

ROI is now 3.72% because the annual cash flow of $2560.25 is divided by the cash investment portion of $68,800 (the rest is from the bank loan).  It seems like the numbers got worse BUT the amount of cash that is invested is much less, and it is still providing cash flow.

Running numbers for Waikiki Tower unit #2: the purchase price of $345,000 and annual net cash flow of $8246.60:

a 4.5% loan on $207,000 (60% of purchase price) will result in monthly mortgage of $1048.84.  $1048.84 x 12 months = $12,586.06

Cash flow is reduced by the mortgage payment, resulting in a negative annual net cash flow of -$4339.46.

ROI is now negative – not a good idea, BUT it may become one if it can be sold for a higher price in the near future, occupancy increases, you want a second home to live in, or you want a piece of the sky in paradise.

Jumping in

Aunty has a talent for losing money.  Stocks are bought and watched as they slide down in price with little bumps up and bigger dips lower.  Poker hands are won and then lost in going “all-in”, but it is amongst friends and only $5 for the buy-in.  Get rich quick seminars cost a lot and leave Aunty with an empty purse, apprehension and not quickly rich.  Fads and network marketing opportunities create a whirlwind of frenzy and high hopes, leaving Aunty with a stash of products, a lot of potluck parties and then later, tired and unmotivated.

Regardless of Aunty’s other losing ventures, real estate that can cash flow is like a hen that always has value because of the constant flow of hen eggs to feed the family.  Some hens drop a lot of eggs, some drop a few eggs.  Some turn out to be turkeys that need to be prettied up and sold.

Aunty thinks that the Ala Moana Hotel has been a pretty sleeping turkey that is turning into a egg laying chicken so she is jumping in to complete the deal of unit #1.

Why?

It is one of only a few condo/hotels that operate like hotels in Hawaii and it happens to be in a super location.

It has just gone through renovations so it looks and smells great.

It is busy, beautiful, well run and well maintained.

It is affordable, especially compared to the new condos that are coming up that cost several times more, or houses in Hawaii.  Prices have been increasing, but at a snail’s pace.

It is fee simple.  Leasehold properties (only Hawaii seems to have these) have lease expirations and potential increases in fees and are not as desirable as fee simple properties especially when you are ready to sell.

It cash flows.  Even at 2%, it beats Aunty’s stock market gambles or money in a savings account.  It will cash flow even better if vacancy rates keep improving.

It has all the advantages of real estate rentals (depreciation, expenses to offset income, income producing asset) as well as the potential for value appreciation.

Owners have the option to live in it part or all of the year and have rent revenue for the times that you are not there.

If it doesn’t work out, it can be sold.

Why are they being sold?

Perhaps the sellers want better results or have found something better to buy or invest in.  Perhaps they went to Rumours Club on a bad day and at the wrong time.

Whatever the reasons, Aunty is glad to have the opportunity to try her hand at the Ala Moana Hotel by owning a piece of its sky.

Steps to take

1.  Ask your realtor to pull up a list of all units for sale at the hotel.  Or drop by the brochure rack fronting Jack Tyrell’s office and get a handy printed list of all units available for sale in order of prices, lowest to highest.

2.  Ask your realtor to get rent rolls for the units that you are interested in so that you can run the ROI numbers.  Have them arrange a showing with the hotel and view prospective units.

3.  Submit your bids with an earnest money deposit check and cross your fingers.  Most of the time you will be countered with a higher price by the seller and it is up to you to accept, counter back, or decline.

4.  If your bid is accepted, do a happy dance, start the escrow process with the designated title company, then go on the eHawaii.gov website to register a business in Hawaii (or visit the DCCA office).  It can be a sole proprietorship, LLC, partnership, etc.  (note to Aunty:  do a post about starting a business in Hawaii.)  When registering for a business license for rental income from a hotel, you will need to apply for your GET  and TA (temporary acommodations) license.  The NAICS # is 721199.

5.  Meet with the ALM hotel rental pool people that are located just behind the front desk area to learn about their pool rental program.  Most units are already in the hotel pool rental program.  Aunty met with Willie (Wilhelmina) and signed up to be part of the hotel pool because the program is so convenient for people like Aunty.

6.  Pay (with a cashiers check) the balance due and sign final escrow papers at the designated title company office.  The deed will then be recorded with you as the new owner.

7.  Congratulations, let the cash flow begin!  As an owner you can reserve your room for friends or family at special discount rates ($105 for the studio), as well as blocking off your room for yourself or your guests for free, though subject to a $40 checkout fee.

Time passed and lessons learned

Aunty will be updating about the wonderful world of hotel ownership in a future post.  The learning curve has been rather steep.  The searching and buying part have been fun and exciting.

Cash flow appears, as well as expenses.

Please stay tuned as Aunty, the hotel mogul wannabee’s saga unfolds.

Meanwhile, here is a list of Aunty’s “team” that have proved themselves to be awesome:

Realtor and/or financing agent:  Noreen Ho  of Savvy Realty (808) 398-8528  nho398@gmail.com

Attorney for LLC formation:  Aaron Mun of Kobayashi Sugita and Goda at (808) 535-5738 or arm@ksglaw.com

Jan 2017 update:  Aunty tried to win an auction last month, but the bank representative shot her down.

Also, cash flow from the “cheaper” units in the Kona tower is dropping.  Perhaps the new owners of the hotel operations (Mantra Group) are offering cheaper booking rates to contract guests.  It is affecting the monthly cash flow for these units, in a junk way. 

Towards the end of 2016, fewer and fewer units in the hotel were available to buy because the offerings were being snapped up like hotcakes.  However, this trend of lower rental income might have current owners dumping their units on the market.  The Ala Moana Hotel Board meeting is scheduled in February.  It will be interesting to see and hear from the new owners, and Aunty will definitely be there.

September 2017 update:  Mahalo for the comments that previous owners have made.  Sadly, they have had very poor experiences and results and have had negative cash flow and/or lost profits.  There ARE better deals out there – and perhaps Aunty’s bias toward the hotel is too positive, but for now, Aunty still likes investing there. 

A caution to prospective new owners, though.  When you let friends and family stay for “free” as owner guests – they are required to pay $40 upon checkout for a cleaning fee, or more if they utilize the daily parking ($20 or $25 if valet) and each extra cleaning day is $18.  That is a really great deal for them, but you, the owner, will have your net rental check from the hotel pool cut by about $100/day.  Be aware of this and limit those owner guest passes unless they really are great friends and family.

Aunty at the auction

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The Honolulu Star Advertiser has a promotion going on, so Aunty gets free Sunday and holiday newspaper home delivery.  At first, these would pile up, unread and then get tossed in the blue recycle bin, but one day, Aunty opened up the paper and saw a page in the classified section about property foreclosure auctions.

One of the foreclosures in the newspaper was for a unit in the Ala Moana Hotel, so Aunty decided to go to hopefully bid and win a condo unit.  One must show proof of funds for 10% of the bid price, and getting a cashier’s check in your own name will suffice instead of carrying around a lot of cash.

Several years ago, Aunty went to her first foreclosure auction, which was non-judicial.  It was rather exciting, and yet not so exciting.  It took place on the sidewalk just across the Federal Building on Punchbowl Street and there was no shouting, pushing, hand waving, or dramas.  One person was in charge of all the properties that were available for bidding on for the day. Not all of the properties were sold because the upset prices were too high, and everyone disbursed at the end, friendly but not friends.

A difference scene

This time, instead of it being on the sidewalk, it was up on the raised concrete area near the courthouse entrance.  This was a judicial auction.  Bidding at a judicial auction is a less guaranteed purchase than at a non-judicial auction, because a follow up confirmation hearing needs to be held, where more bids, pleas, etc. can be entered by interested parties in court, even if you “won”.

On this day, only 2 properties were being auctioned – the one Aunty wanted at the Ala Moana Hotel, and a single family home in Pauoa.  One man took down the info of potential bidders and checked to make sure that proof of funds (Aunty’s cashier’s check) were in order for the Ala Moana Hotel unit, and another man took down the info of potential bidders for the Pauoa house.

At 12:00 noon, the auction began without much fanfare for the Ala Moana Hotel, and $1 was bid by the AOAO Homeowners’ representative.  According to the fact sheet, the current owner was in arrears for $45,633.38 to the AOAO, and had a delinquent first mortgage of $128,088.02.

To tell you the truth, Aunty was like a fish out of water, but a curious fish that always wanted ownership in the Ala Moana Hotel, so Aunty “raised” the bid to $10.  Ha!

The AOAO rep looked a bit irritated and asked how low an increment could the bids be, and he said that it could be whatever.  She then “raised” the bid to $1,000.  Aunty countered with $20,000 (really being a fish out of water) and hoped – Maybe, maybe, maybe?

Nope, the AOAO rep responded with $21,000.  Bleeegh.  At this point, Aunty knew it was going to be a fat cat chasing a fishy mouse with $1,000 raises, so Aunty did not counter, no one else bid, and the going going gone went to the AOAO for $21,000.

Disappointing relief

Aunty believes that things happen for a reason or because it is just the way it is.  Her attention and curiosity now turned to the auction for the Pauoa house.

It was a 3 bedroom single family home on 5,000 square feet and Aunty watched as 2 ladies battled for the property with their bidding.  It was very civil, one woman would bid, and the other would bid $1,000 or $2,000 more.  It seemed like this would take a long time going back and forth in the $445,000 to $450,000 range, but surprisingly it ended quite quickly after a $453,000 bid was placed and won the going going gone stamp of approval.  Aunty wanted to clap.

An alright & rather exciting day

Looking back, it was a kinda neat day.  Not an earthshaking day, not a life changing event – but it was a first hand opportunity to take a chance and watch some action.

Aunty now looks forward to receiving the Sunday Star Advertiser paper to check out the foreclosure auctions, not just because of the auctions, but to keep a finger on the pulse of what is out there.

The pulse of Hawaii

Hawaii does not follow national trends, especially in real estate.  It seems like everything is super sizing, and getting bigger in prices, house sizes, and improvements.

Is real estate in Hawaii good for investors, or even homeowners?  Hard to say, especially mixed in with the super low interest rates that have been around recently.  We are limited in land because we live on islands in the middle of the sea, though the many new up and coming high rises seem determined to take their pieces of the pie straight up since they can’t go out.

Meanwhile, old homes in nifty old neighborhoods are being put up for sale to settle estates.  It is like seeing rare objects come to light, for very flashy prices.  New people move in with different ideas and the face of neighborhoods change with bulldozers and concrete trucks.

The flow

Change happens.  Even if Aunty stays in the same place, the area around her will become transformed.  That is kinda sad, but also kinda alright.

It reminds me of a quote of Gandhi that our #3 likes to say, “Be the change that you want to see in the world.”

Sometimes though, Aunty just wants things to remain the way they have always been.

Real Estate Lesson from Uncle the Fisherman

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next doorRecently, the house next door to us was for sale.  Aunty wanted it.  Wanted it bad.  We put in an offer that was higher than asking price with generous concessions and a very big mortgage.  With some rehabbing and modifications, this house could be rented out with a little bit of a positive income.

The owners decided to go with another offer and sent us a counteroffer which they would use as backup.  Aunty was devastated and feeling desperate.  “Call the agent!  What will it take to get the house?!  Do it now!”

That night was one of anxiety and frustration, and great disappointment.

In the morning, Uncle’s picture of his oio catch many years ago (before we got married) was propped in front of Aunty while eating her typical breakfast of Honey Bunches of Oats and coffee.  This was a favorite picture.  In it, you could see the joy of the catch in Uncle’s whole being.

The ones that got away

Uncle loved the ocean.  In his younger days, he would surf, surf, and surf.  Later, he would surf less and fish, fish, and fish, always from shore since he didn’t like fishing on boats.

Most of the time, he wouldn’t catch a thing.  Sometimes he would catch a great haul, sometimes a little haul.

However, the ones that gave him the greatest pleasure were the big ones that took his line out and got away.  These, according to Uncle, were HUGE (and they got bigger with each telling).

Opposites attract

Uncle was always very thoughtful in his decisions.  Aunty usually does not think and would let emotion and instinct rule.  We were quite the opposites and perfect for each other.  Aunty would jump, Uncle would hold the bungee cord.

Owning the house next to us would have been great (JUMP), and it would also be a big financial burden with potential cash flow (BUNGEE).

Lesson from the fisherman

fish!While gazing at Uncle’s picture, a realization dawned on Aunty.  Not getting the house next door was like the big fish that got away.  It was okay.  Maybe even, better than okay.

In the morning light, looking at Uncle’s broad smile, peace and acceptance washed over the disappointment of losing the house.  It was time to cut the line and enjoy the process.

There will be always be other opportunities.  Sometimes you catch a good one, sometimes not.

As for the big ones that got away – just keep on fishing for an even better one.

September 2015 update:  TWO more really great properties came up on the market – one was THE picture postcard from Aunty’s google page – beachpark frontage with grassy lot and busted up old house with a little lanai on the beach side that could take all of your cares away.  Another one on a special street in Kaimuki with an old cute house in a killer location and HUGE pirie mango tree on a level lot that would have been perfect as Aunty gets older.  But alas, they also got away. 

Investing in Hawaii

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2013-05-04_14-55-39Hawaii is not the easiest place to invest, although there are ways to buy, rehab, and flip properties for a few thousand dollars profit.  With home prices in the half million and up range, there is little cash flow in buying and holding unless you are as smart and wise as Bill Harvey (now has a website! and will be able to meet him at almost any real estate meeting).  Maui has been hit pretty bad with foreclosures but I do not know the Maui market well enough to invest in it yet.  If you know of a great Maui realtor or of some great deal on oceanfront or close to oceanfront fishing grounds (for Uncle), let me know please!

One of the best ways to get your mindset into investing is to play the Cashflow Game by Rich Dad founder, Robert Kiyosaki.  There are several places around the islands that meet regularly.  This is a very nice group of people with the good intention of enhancing your investing education.  Go to RichDadHawaii.com for places and times.  They even sponsor Paniolo Exchanges once a month – a really neat way to trade something you have and don’t want or need for something someone else has that you want or need.  I’ve walked away with an awesome collection of “Blade” episodes in exchange for a handmade necklace art piece!

My Rich Dad coach (very expensive program ~$6,000!) gave me a good push into real estate investing.  One of the best pieces of advice he gave was to join a local real estate investing club.  What?! I said, Hawaii doesn’t have a club like that!  Well, my bad, after google searching I found one – Hawaii Real Estate Investors.  Annual dues are $120 and you get a nice embroidered polo shirt!  Meetings are held on the first Thursday of every month and is a great way to meet fellow investors and contacts.  Through this group I have met some fine people willing to share and teach me the ins and outs, the do’s and don’ts, and am seriously considering investing in Indianapolis (!)  My girlfriend Patricia calls it Indian-no-place – she didn’t much care for it in the 60’s, but I think part of the reason was because Patricia is a rebel and an artist, and Indian-no-place was no place for her.

Paul Xavier and co., the organizers of the Hawaii Real Estate Investors Club also run some free monthly meetings, check out the calendar at HiREI.org.  The first Thursday of every month are the standard Investor meetings ($15 fee charged at the door or free with $120 annual membership, $5 parking at JCCH), and throughout the month, you have the opportunity to learn from others as well as Paul or Randy.  The 2nd Tuesday of every month are free RX Inner Circle meeting, very informal, sit in chairs and ask questions.  The 3rd Tuesday is for the “Gold Inner Circle”, at $97/mo. you get a catered dinner and people who are actively investing share what they are doing.  I get shot down almost all the time about my investing in Vegas by Paul, but I can take it.  [Update:  Paul has now expanded his real estate buying tours to include Las Vegas!  Yeehaw and goodie!!  Check out HiREI.org for dates and details.]  It’s my strategy and it’s been good for us.  On the 3rd Wednesday of every month, HiWire – Hawaii Women Investors meet (see 4th paragraph below).

[Another financial/real estate group that meets regularly in Honolulu is the Wealth Clubs of America, Hawaii division that Gavin Tsuda and Michael Mazzella run.  Their meetings are held on the first Tuesday of every month.  Excellent presentations and great information, and food!  One of the regular exercises they have at each meeting is networking.  This is a great place to bring a stack of your business cards and make new potential business partners or solutions to your choices.]* no longer have meetings – will update if meetings begin happening again.

An awesome and controversal link to Hawaii real estate is OahuRe.com.  Every day I get listings and new updates on properties fitting my criteria.  Thanks to Bryn Kauffman for providing this terrific free service.  One day we will find the ideal property – large lot, lots of parking, beachfront, off shore winds, wood floors, big front lanai, etc. and we will probably see it first on this site since the access is as easy as ebay.

Although I have heard about them at the Hawaii Real Estate Investor Club meetings, I never attended the women’s meeting – HiWire (Hawaii Women Real Estate Investors) until just recently.  At the last meeting, Gail and Shelli shared their strategy of buying tax liens from Yuma County (used as an example).  The easy going style of the group meeting as well as valuable content is wonderful.  I look forward to attending more meetings and meet more women that are active investors.  We speak the same language, and we all put down the toilet seat.

In Hawaii, it always come down to who you know.  Sometimes that can be very frustrating, and other time it opens doors and opportunities galore.  Through a dear friend of mine who I call Wandaful, I met a investment minded local realtor, Kevin Kekona who is currently an agent with Prudential.  Young, energetic, smart.  I just know Kevin will be key to our finding our best Hawaii cash flowing deals.  I’ll see if he has a website and link to it.

Hawaii is home, and will always be home for us.  As a real estate investor, I am waiting but keeping my eyes and ears open for the occasional deals that are available.  One fact that makes me want to hold the majority of our real estate in Hawaii (eventually) is that we are very very limited in being able to expand.  Because we are an island state, the Pacific Ocean defines our borders.  Thus, there are only so many homes and buildings that can be built here.  Land is gold here.  And living here is paradise.

After meeting the fine group at Real Deals Hawaii, our strategy has changed.  We will use some of the cash we have available to buy into a joint venture, rehab, and sell for quick profit.  After we do a few of those deals, we will have enough to buy cash flowing property in Vegas, and yes, maybe even Indiana, and possibly even Hawaii if the deal makes sense.  That’s the plan for now and we’re sticking to it!  In fact, one of my favorite investment websites just had a blog about using both buy and flip and buy and hold strategies together to build wealth.  Jeffrey Brown of BawldGuyTalking.com said it very well in his post, “Investing in your future, on purpose, with a plan”.

Here’s a page on financing in Hawaii.  Hope it helps.  It is only what I have come across that works for us so far.  There is more available – I am learning as I go.

Rehabbing in Hawaii

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One thing about Hawaii is we feel more secure in knowing someone who knows someone they used rather than just calling a company from the yellow pages.  It isn’t always true that the one with the biggest and best ad is the best company.  I rather use tried and true, and if we have had good results at a fair price from one person or company, we will use them again.  I also trust in the recommendations of friends who have had good experiences.

On this page, I will share some of those with you.  ** Update:  please see note at the end of this page regarding using recommendations based on people’s friends.

Lowe’s has 10% off coupons on RealtyTrac and you can also get them from the US Post Offices if you ask them for a change of address packet.  Good way to save money on your rehab or repair projects.  While you are there, stock up on incandescent light bulbs.

Craigslist.org is a great free website that can be used whether you are buying or selling just about anything.  I like to post free stuff – beats throwing things away when someone else can make use of it.  Good place to search for building materials.

Re-Use Hawaii is a non-profit recycling company that has stuff nobody else has.  Old stuff as well as newer stuff.  I am still looking for 5′ redwood fencing material, and if I keep checking often, I am sure they will have it.  They also accept donations of materials and even come pick up if it is a big load.  Hard to find and easy to miss.  Head makai (towards the ocean) from the old Comp USA.  It is Ewa of the UH Medical school.

My pal Wanda has the most beautiful master bath counter that I have ever seen.  It looks like a 4″ thick block of celadon clear jade with inclusions.  Drop dead gorgeous, no seam in sight or touch, a work of art.  On the pricey side, but worth every penny.  Nice young man who used to do marble/tile/stone work for homes in Beverly Hills – Jason Carroll.  Phone #(808) 478-8453, email HawaiiKaiCustomStone.yahoo.com.   He will be installing a slab and a half of a different kind of onyx in our bathroom – a mysterious looking jade-like stone with yummy splotches of burgundy and wine.  I just have to get down and dirty and redo the flooring, walls, and bring in a vintage looking console for the slab counter top.  It will be beautiful!  Maybe even more beautiful than Wanda’s!

Tile suppliers and showroom:  In my quest to have a 4″ hole cut in the middle of a piece of porcelain tile, I missed International Tile Inc. and I kind of got lost near the Nimitz area.  I headed back to town and saw a big sign “Pacific Stone Center, Inc.” 140 Puuhale Road (808) 847-3412 and buzzed in hoping that they could cut the hole.  Florence Fernandez helped me at the desk, and unfortunately they did not cut porcelain tiles.  However, on the wall were the most gorgeous natural stone samples – one had me drooling – some kind of Picasso marble or stone that looked like it had fossilized leaves in colors and layers of unreal beauty.  I rank this company A+ in customer service because of the way they treat anyone who walks in.  She did give me directions to International Tile on 2223A Hoonee Place.

International Tile Inc. moved from their former location years ago.  The president of the company, Richard Thompson took a look at the tile, said they could cut it, and I was so pleased that here is another company with excellent customer service and the willingness to help me with a small dinky little job.  When we re-do our bathroom, I will look to these guys first.  They are not as convenient as Home Depot or Lowes, but the level of expertise and workmanship, along with such excellent people in place deserve my future business.  They also have MUCH more choices to choose from.  Delightful dilemma.

Plumbers:

C&W Plumbing – good work, very reputable.  Clyde Watanabe is the man.  Shop is located in Kalihi, phone number is 842-0222.

Electricians:

Mike Wall of Haleiwa Electric, 226-7617.   Mike is usually busy because he is always in demand because he is a terrific electrician.  One of the most reliable and “correct” contractors out there.  He follows codes – they are there for your safety and important to pay attention to.  Such a hard worker, and reasonable prices for top quality work.

Cary of Power Wise Electric.  Good work, mostly for commercial jobs, also makes fantastic seasoned pork strips.  He is another busy electrician – most of the good ones always are.

Framing, carpentry:

Gary Iwane, 864-1911.  Gary was referred to us by Alvin Arasato, the best house painter around.  Gary does beautiful neat work and leaves the workplace clean and tidy.  This is a true craftsman at a fair price.  Almost makes me wish I had more things needing to be renovated.

House Painter:

Arasato & Sons.  737-2419. Alvin’s sons don’t work for him anymore, one is a world class boxer and the others have gone on to excellence in other fields.  If you want a cheap paint job, don’t call this company.  However, if you want the best for a reasonable price, Arasato & Sons will fit the bill.  The hardest and longest process of painting an old house is the preparation – extensive sanding, filling in, removing of old to prepare for primer and however many coats of paint necessary.  Use the best paint if you want the best results.  What I like most about Alvin is that he not only has a wonderful sense of color, he also appreciates and values good construction.  He has an eye for making everything look its best, i.e. trimming out doorways and details, giving suggestions on problem areas, figuring out how to get those old stuck cabinets to work better.  He is like an encyclopedia of good taste and high quality.  He also has great references for plumbers, woodworkers, etc. that will work with him on the job.  After Alvin is done, the house looks brand new and gorgeous.  [Aunty has heard that Alvin has retired from the business, boo hoo.]

Wood floor installation and refinishing:

Nishimura Floor Service 737-4721.  Peter will come to your place, look around, measure, and jot a number down on the back of his business card.  That’s the price he will do your job for, and he does it very well with employees that have been with him for years.  Beautiful quality work, your wood floors deserve him, and his price is so very reasonable!  Pricing that will fit on a business card.

Vinyl/alternative flooring:

Call Mike Tai See from Homeowners Design Center on Kohou Street in Kalihi.  Phone 847-0216 or email him at mikets@homeownersdesign.com.  He knows his flooring and if you tell him what you want, he helps narrow down your choices by looks, budget, and application.  We found the most wonderful vinyl sheet with great texture, warranty, and appearance at a reasonable price with installation.  If I had a company that sold things, I would definitely want Mike on my team.  He was even an AYSO bronze team soccer coach in Waipahu when his girls were younger – that shows real character in my soccer book.

Driveway contractor:

Darryl Imai 772-2769.  We had several estimates for a huge driveway.  Lots of problems with big big rocks that needed to be busted and removed, a slope down towards the house which could result in a river of water hitting the front door, and tree roots everywhere.  Darryl gave us the best price without hesitation or delay, and then began work coordinating dumpster, excavator rental, operator, concrete pour and finish.  We now have a beautiful smooth driveway with a gentle imperceptible rounding in the center that diverts the water flow away from the house and off to the side.  He and his crew sometimes have pau hana hour after the job each day, so just be sure to let him know if you don’t want them hanging around after hours having a few beers.  On the very last day we bought a catered menu feast from Gina’s BBQ, 2 cases of beer and some poke´as the local way to say mahalo for a job well done.  My reward was a hug and “Tanks Aunty!”  Almost makes me wish we had another driveway to pour – the end result is beautiful and perfect.

Grass supplier:

Quality Turfgrass in Waimanalo, phone 259-8191.  Don’t limit yourself to those trays of grass at Home Depot, Lowes, and the like.  When I want “fresh” healthy grass, I call Gumi  of Quality Turfgrass and ask them to bag up rolls of grass that can be cut into 2’x4′ sheets.  Not that much of a price difference from the trays, but you do save a little and tend to get more.  The quality is great, and a good excuse for a lovely drive into Waimanalo’s beautiful valley.  Prepare your ground with good dirt and sand, then lay the sheets down.  Keep dogs and people off until it takes, water at least twice/day for the first 2 weeks.  I also cut them (use those small branch trimmers) into plugs and plant them that way when I feel cheap, lol.

Tree Trimmer:

Tai 372-7660.  One day Uncle and I were feebly trying to cut a limb off of a mango tree up front.  It was taking a very long time partially with a dinky home electric chain saw, and then with a saw blade on a pole.  Along comes T in his truck and asks if we want him to cut the tree for us.  After a bit of macho maneuvering on Uncle’s part, a fair price was struck – well actually, T gave a very reasonable price and Uncle said “okay”.  Then T hops up on the tree and starts trimming from the bushy to the branches to close to the stump with his gas chain saw.  Very impressive.  The next day he returned to remove all the rubbish.  A man walking by with his 2 dogs commented about the bolohead tree and said he had the same thing done.  Uncle told him what a good price we had it done for – $250, and the dog walker said his tree was bigger and he got it done for $280.  “Samoan guy”, he says.  “Yup” says Uncle.  Turns out T had also cut the dog walker’s tree too!  Small world, small neighborhood.  If you need your tree trimmed/cut, call Tai.  He decided not to relocate to Reno and came by the other day to let us know that, as well as ask if we needed any stone wall built.  We didn’t, but we are glad he is back to cut trees again as needed.

Stone wall builder

Tai again.  372-7660.  We had a stacked rock back yard wall holding back 5′ of dirt height erode after a big rain and we were in a pickle because at least half of it was inaccessible due to the back neighbor’s home made shed.  Tai to the rescue, and in a few days, a new stone wall with new pipe posts was put up for a super reasonable price.  He also cut off a few huge limbs of the mango tree again.  Very happy.  Now Aunty has a new redwood fence that replaced the ugly weedy chain link fence on top of a brand new retaining stone wall!

General contractor:

If you have worked with a general contractor that you have had great results from, please leave a comment below.  Aunty usually works with sub-contractors, but it is good to know someone who does it all.

*if I don’t have the contact info or phone number, etc. for any of these contractors, write to me at Aunty@hawaii.rr.com and I’ll give you the info.  I am still in the process of checking with them if I can put their phone numbers on my website.

**Uncle and I are in the process of rehabbing a property here and have been very pleased with the great work of the people we have hired.  The transformation of the house has been wonderful and neighbors walking by love to comment and get tours of the inside.  The only glitch so far has been our gutters.  Rather than go with an established gutter company with a good reputation, we went with someone’s recommendation of a friend.

Lesson learned:  make sure the craftsman knows exactly what you want (i.e. cover up the ugly stuff and keep the integrity of the style) and be there at the beginning and at the end of the job for final approval.  Also, the recommendation that “my friend does gutters” is not good enough.  “This person did my house and it came out really really well” is a much better recommendation than friendship.  We will get this re-done, maybe not by the moonlighting gutter man since he was already paid (big mistake), but this eyesore will be taken care of one way or another, and we consider this the price of education.

Aunty the Realtor (update – not anymore)

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Uncle would make a great real estate agent.  I never wanted him to be one because he is so handsome and charming – call it jealousy and control; I call it being smart and safe.  Well, we are getting older and it’s time to let kites fly and dogs run.

Paul Xavier & Co. (formerly Real Estate Xtreme) have presented a great opportunity to anyone who is already a licensed realtor or agent, or thinking of becoming one.  To kick it off, they are re-naming and re-branding to Nextage Aloha Realty and moving into a bigger office in the same Pearl City complex at 98-029 Hekaha Street behind Cutter Ford.

Nextage is a different way of compensation for realtors.  Traditionally, an agent and broker have a pre-determined split of commissions, and if an agent sells, he/she makes a cut of the sale and the broker makes a cut.  If an agent doesn’t sell anything, he/she doesn’t make anything.   A wise friend of Uncle was a realtor for the very reason that real estate is the most expensive item people buy, and has the highest commission.  The next most expensive item is their car.  So, if you are going to make commisions, make it with real estate (followed by automobile commissions I suppose).

Imagine combining the multi-level marketing concept of companies such as Amway, Shaklee, Mary Kay Cosmetics, etc. to real estate.  All those spokes that radiate out from your base also help to feed your base.  At the same time, whatever sales you make are credited to you and help to raise you to a higher compensation level.  The more people that sign up under you increase your compensation level, and so on.

Well, when I first heard the presentation from Paul Xavier and saw the slide presentation, I dismissed it as a MLM (multi-level marketing) gimmick and not for me.  However, the more I thought about it the better it became.  This is passive income in the most lucrative and desirable market of real estate, with the option to get more active and generate even more income.  The fluctuations of selling one month and not selling the following month are padded with the team commissions from your 1st, 2nd, 3rd, etc. generations of agents.  The bottom man on the totem pole will still get the biggest share of the commission since he did the most work, but you also get to share in the “remainder” portion whether you had a hand in the sale or not.  It becomes one big team and it would deserve a great big team party at the restaurant of our choice every year!

Seriously, I might have Uncle get his license, or I’ll get one [Got mine!].  Aunty signed up under Nextage Aloha Realty – for $125/year + $80 start up fee.  I’ll soon have a website for anyone wanting to become a Nextage agent, so ask me about it before you do sign up and Aunty gets credit.  [Aunty has decided not to renew her license as a real estate salesperson – it IS a lot of responsibility and a whole lot more to learn!] Paul Xavier doesn’t believe in Las Vegas investing (yet), and we probably have more differences in politics, philosophies, and poop, but he is a straight shooter.  I respect straight shooters even if I don’t like their brand of bullets.

Meanwhile, check out Paul & Co’s new website NextageAlohaRealty.com. This gives a brief overview of the “we” instead of just “me vs them” kind of company concept. Make sure you let the know Aunty sent you so I get credit.  [Or so Paul thinks that Aunty is cool.]  Paul also runs info meetings about Nextage every Monday evening at 7:00 pm at the new office in Aiea.  Contact them at:

808-483-5777

and let them know you want to attend their free info seminars to learn more!

I took my pre-licensing course from Abe Lee Online Seminars.  I find his audio lessons really entertaining and educational at the same time.  It costs me $425, but well worth the money – as it teaches me as well as prepared me to pass the State and general tests in order to get licensed.  I am also interested in his Ninja training – the cadillac of systems for realtors.  So much to learn, it’s a wonderful time.

Here’s a website that compares rental prices in your area:  rentometer.com.  Pretty cool stuff for a realtor, renter, or landlord.

MySmartMove.com is a site that helps landlords by taking online tenant applications and checking their credit and criminal information for a fee ($25 or $30, depending).  Fees can be billed to prospective tenants, though it is up to them to accept those conditions.  Check out their video (rather long) tutorial to see if this will work for you.