More investors here search for a DSCR loan than for hard money, and for good reason: Oahu's prices make a long-term rental loan the natural finish to almost any deal. But the islands tax investors differently from homeowners, Maui has set end dates for thousands of vacation rentals, and outside Oahu thinner resale markets make values harder to support. Here is how to underwrite a Hawaii deal around all three.
Hawaii's low property tax belongs to homeowners
Hawaii has some of the lowest property tax rates in the country, but each county sets its own classes and rates, and all of them charge an investor more than a resident owner. On Oahu for the 2026 to 2027 tax year, a home the owner lives in, with the home exemption filed, is taxed at $3.50 per $1,000 of net taxable value. An investment home assessed at $1 million or more falls into the Residential A class, where the portion above $1 million is taxed at $11.40 per $1,000, more than three times the owner-occupied rate. The home exemption requires the owner to live there as a principal residence for at least 270 days a year.
The neighbor-island counties run their own versions. Hawaii County has created a separate class for long-term rentals and reported more than 800 applications to join it, a sign of where the counties are heading: lower taxes for homes rented to residents, higher ones for vacation rentals and homes that sit empty.
Two more state taxes belong in the numbers. Rental income is subject to Hawaii's general excise tax, 4 percent at the state level plus a county surcharge. And the conveyance tax on a sale is tiered by price, with higher rates for buyers who don't qualify as owner-occupants. Get both figures from your escrow company and your CPA before the offer.
Short-term rentals: Maui's end dates and Oahu's 30-day rule
Many Hawaii investment plans assume vacation-rental income. Check that assumption first. On Maui, Bill 9, signed on December 15, 2025, phases out transient vacation rentals in apartment-zoned districts, including the long-grandfathered condos known as the Minatoya List, roughly 6,100 units on Maui and Molokai. Short-term rental use must end by January 1, 2029 in West Maui and January 1, 2031 in the rest of the county. Owners have sued, and the cases were still pending in 2026. In June 2026 the Council also voted for Bill 88, which sets up new hotel zoning districts that some of these buildings could be rezoned into, but each building has to go through a separate rezoning. Until a building is actually rezoned, or a court rules otherwise, the deadlines stand.
On Oahu, rentals of less than 30 days are generally not allowed in residential zones outside resort areas, and enforcement is active. Across the state, hotel- and resort-zoned units and properly permitted rentals continue under their own rules.
For a DSCR loan, that means underwriting on long-term rent unless the unit's zoning clearly allows short-term use and will still allow it for the life of your plan. A Minatoya condo priced on its vacation-rental income today is a very different asset in West Maui after 2028.
Oahu: where most Hawaii deals get financed
The Honolulu Board of Realtors reported an Oahu median single-family price of $1,240,000 for August 2026, up 12.2 percent on a year earlier and close to the record set that June. Condos moved the other way: the median fell about 1 percent to $510,000, with rising inventory and buyers weighing maintenance fees, insurance and the building's reserve funding alongside the price.
Those prices make the loan size the first thing to check. On a house worth $1.2 million after renovation, 70 percent is $840,000, and a short-term loan of that size gets a close look at your experience and liquidity. Confirm the maximum loan for your deal with the lender before you go under contract.
For condos, the building matters as much as the unit. Special assessments, rising association fees and thin reserves change both the resale price and the rent needed to cover a DSCR payment. Ask for the association's budget and reserve study before the offer.
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Send the address, the numbers and your exit. Our lending partner's team reviews it and tells you whether it fits and on what terms. The lender makes every credit decision.
Maui, the Big Island and Kauai: where the lender looks harder
Resale depends on a deep pool of buyers and recent comparable sales, and Oahu has the most of both. The neighbor islands are smaller markets, so a deal on Maui, Hawaii Island or Kauai gets closer scrutiny of the after-repair value and the exit. Send the address early and the lender will say whether it can be financed, rather than letting you find out after the appraisal.
Wherever the property is, confirm it is fee simple. Hawaii still has leasehold property, where the building is owned but the land is leased, and a short remaining lease term makes a property hard to finance and hard to sell. Check flood zone and, on Hawaii Island, the lava hazard zone, because both change what insurance costs and whether it is available at all.
DSCR loans in Hawaii
A DSCR loan qualifies the property rather than your paycheck: the rent must cover the payment, including principal, interest, taxes, insurance and, for a condo, association fees. Our lending partners' DSCR rental program has no minimum credit score, lends from $75,000 to $2 million, and goes up to 80 percent of value on a purchase or rate-and-term refinance. The lender sets the rate for each file.
The $2 million ceiling fits most of Oahu's market. What decides a Hawaii DSCR is usually the expense side: the Residential A rate on investment homes over $1 million, the general excise tax on the rent, insurance, and association fees on condos. Run all four before you count on the rent to carry the loan.
Fix and flip loans in Hawaii: how the loan gets sized
Dominion Hard Money does not lend its own funds; it arranges financing through third-party lending partners. For fix-and-flip, rehab and bridge loans, standard pricing starts at 12.99 percent plus 2.99 points. Borrowers who have paid off two loans with the lending partner in good standing can qualify for loyalty pricing of 10.99 percent plus 1.99 points.
The programs lend up to 70 percent of the after-repair value and up to 100 percent of cost, whichever limit is reached first, with a minimum loan of $50,000 and a minimum credit score of 600. Leverage depends on the projects you can document over the past three years. The property must be non-owner-occupied and held in an LLC or corporation. Renovation budgets buy less in Hawaii than almost anywhere, given shipping and island labor costs, so the lender will look closely at whether your budget and experience match the scope.
Selling from the mainland? Hawaii's HARPTA law requires the buyer to withhold 7.25 percent of the amount realized when the seller is not a Hawaii resident, unless an exemption or waiver applies. Out-of-state flippers should plan for that cash being held until they file a Hawaii return.
Seven checks before a Hawaii offer
1. Confirm the island and the zoning. Oahu has the deepest resale market; neighbor-island deals need a closer look.
2. Price the property tax at the investor class, not the seller's homeowner rate.
3. Underwrite long-term rent unless the zoning clearly allows short-term use for your whole plan.
4. For a condo, read the association budget and reserve study.
5. Confirm fee simple title, and check flood and lava zones.
6. Get written contractor bids with shipping and island labor costs built in, plus at least ten percent for surprises.
7. Add the general excise tax, conveyance tax and any HARPTA withholding to your rent and closing numbers.
What gets a Hawaii deal declined
A DSCR built on vacation-rental income the zoning won't allow, now or after Maui's deadlines.
A neighbor-island property with no recent comparable sales to support the value.
Leasehold land with a short remaining term.
A large loan request without the experience and liquidity to support it.
A condo you'll live in part of the year. Property you or a close family member will use as a residence is owner-occupied, and our lending partners finance non-owner-occupied investment property only.
Want the long version? Two free landlord books cover what a rental really costs to hold and what the new federal housing law actually changed.
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Questions investors ask
Can I get a DSCR loan on a Hawaii rental?
Yes. Our lending partners' DSCR program lends from $75,000 to $2 million, enough for most of Oahu, up to 80 percent of value on a purchase, with no minimum credit score. The investor tax class, general excise tax, insurance and any association fees all count against the rent.
What do hard money lenders charge in Hawaii?
Our lending partners' fix-and-flip pricing starts at 12.99 percent plus 2.99 points. Loyalty pricing of 10.99 percent plus 1.99 points can apply after two loans are paid off in good standing. Closing costs, conveyance tax and the appraisal are separate.
Can I get a flip loan on Maui, the Big Island or Kauai?
Sometimes. Neighbor-island markets are smaller, so values are harder to support and deals get closer review. Send the specific property through the form and our lending partner's team will tell you whether it fits.
Can I use a DSCR loan on a Maui vacation rental?
Only if the unit's zoning allows short-term use for your whole plan. Bill 9 ends short-term rental use in Maui's apartment-zoned districts on January 1, 2029 in West Maui and January 1, 2031 elsewhere, so many condos should be underwritten on long-term rent.
Why is the property tax on my Oahu investment home so high?
Investment homes assessed at $1 million or more fall in the Residential A class, taxed at a much higher rate on the value above $1 million than an owner-occupied home with the home exemption. The exemption requires the owner to live there as a principal residence.
Can I finance a leasehold property in Hawaii?
Leasehold property, where the land is leased rather than owned, is much harder to finance and sell, especially with a short remaining lease term. Confirm the property is fee simple before you make an offer.
Sources
- City and County of Honolulu, Real Property Assessment Division, Oahu tax classes, Residential A and the home exemption
- City and County of Honolulu, FY2027 final tax rates, $3.50 homeowner rate and $11.40 Residential A rate above $1 million for 2026 to 2027 (accessed Oct 2026)
- Honolulu Star-Advertiser, Oahu condominium prices fell in August, home costs surged, Honolulu Board of Realtors August 2026 medians of $1,240,000 and $510,000 (accessed Oct 2026)
- Maui Now, Maui Council passes Bill 9 on second and final reading, December 15, 2025 passage and the 2029 and 2031 phase-out dates (accessed Oct 2026)
- Honolulu Star-Advertiser, Exemption path opens for Maui vacation rental phaseout, Bill 88 hotel zoning districts and the roughly 6,100 condos covered by Bill 9 (accessed Oct 2026)
- Hawaii Department of Taxation, general excise tax, 4 percent state rate and county surcharge on rental income
- Hawaii Department of Taxation, conveyance tax rates and HARPTA withholding on non-resident sellers
Dominion Hard Money does not lend its own funds; it arranges financing through third-party lending partners. All financing is arranged for business purposes only and secured by non-owner-occupied investment property. Not a commitment to lend. All loans subject to underwriting, property review, and approval by the lender. Terms vary by property, borrower experience, and exit strategy.