Due to the record-breaking torrential rain of the warning level issued the other day, damage occurred in various places on Oahu. Flooded areas, schools closed due to fallen trees, Kahala Mall flooded above floor level, and substations submerged, causing massive power outages in downtown and Chinatown.
Financial institutions such as First Hawaiian Bank and Bank of America are also concentrated in downtown and were forced to temporarily close due to the large-scale blackout. The surrounding area is lined with office buildings, and along with it, there are many restaurants.
Natural disasters like this can hurt businesses, and in Hawaii's case, real estate as well.
When there is a heavy rain in Japan, the main damage to buildings is broken window glass and flooding, but in the case of buildings in Hawaii, the most common damage is rain leaks. This is because many of Hawaii's real estate properties are older than 50 years old.
This expression "old building" is a feeling seen from a Japanese perspective. In Japan, relatively new properties tend to be preferred, but in Hawaii and the United States, 50-year-old properties are not classified as very old. From a global perspective, there are many 200-year-old properties in historical European cities, and living in an old property can even be considered a status.
Recently, as in the Kakaako area, redevelopment is progressing, and new properties are increasing in Hawaii, but the characteristic of Hawaii is that most of the properties are old. However, unlike in Japan, buildings in Hawaii do not necessarily lose value just because they are old. Unlike in Japan, the age of a building does not greatly affect the value of the property. Rather, even if the building is old, the price of a property that has been refurbished and cleaned inside is often higher.
Therefore, when considering purchasing real estate in Hawaii, it is more constructive to focus on renovation rather than worrying about the difference in years between properties that have all been built.
However, one thing I would like to point out here is the inescapable problem of an old building: rain leaks. If you own a property for yourself and own a section, it is normal for the management company to handle the repairs of the property itself while paying the management fee, and you will only have to pay the management fee when you take it out. If you own an entire building for profit, the owner will be responsible for repairs such as leaks. Of course, it is possible to use the management fee for the repair, but the higher the management fee, the more difficult it is for tenants to come in, so the more people take it out.
Due diligence to thoroughly examine the condition of the property is important when considering purchasing real estate in Hawaii, in order not to lose money on repair costs after purchase due to leaks.
This due diligence is an investigation period that has not yet penetrated into the real estate buying and selling process in Japan. Because the property environment is different from Japan, it is important to thoroughly confirm whether or not there will be a loss after the purchase during this investigation period.
If the country or region changes, the value standards of real estate and the problems involved will also change. If you are going to buy real estate in Hawaii, it is a good idea to acquire knowledge about properties in that area in advance.