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After taking my household on a nine-day trip to Honolulu, Hawaii, my plan to relocate there may be again within the playing cards! Since 2014, two years after retiring from my finance job, I have been considering transferring again to Honolulu to spend extra time with my mother and father. Nevertheless, really making the transfer has been a lot more durable than anticipated.
Simply as financially insecure folks typically inform themselves “just one more year” earlier than retiring, I have been saying “perhaps subsequent 12 months” about transferring to Honolulu for the previous 10 years!
The factor is, life retains getting in the way in which. First, we had a son in 2017, then a daughter in 2019, and the pandemic made us crave stability and familiarity. Our son received into a faculty he enjoys immensely, and now our daughter has joined the identical faculty, which we imagine she’ll additionally get pleasure from. In consequence, the inertia of life has stored us in San Francisco.
Nevertheless, with my mother and father now of their mid-70s, the time to spend extra time with them is now. Our children additionally dealt with their longest time away from residence effectively. Though, they complained concerning the warmth, they missed it as soon as we returned.
My considerations about them adjusting to a brand new surroundings have diminished.
The Challenges of Residing in Honolulu, Hawaii
There are three important challenges of dwelling in Honolulu: housing, meals, and work. If you happen to plan to ship your kids to non-public faculty, affording the schooling and getting accepted are additionally important challenges.
Let’s focus on every problem should you’re contemplating dwelling and dealing in Honolulu. In case you have ever lived and labored in Honolulu or presently do, I would love your insights as effectively.
Honolulu’s Excessive Residence Costs
Honolulu boasts one of many highest median residence costs within the nation at roughly $1,050,000. In the meantime, Zillow has the median Honolulu residence worth round $800,000, however I do not belief Zillow. When home looking, it typically appears that properties value rather more than the median worth, irrespective of town. Humorous how that’s.
To afford a median-priced residence utilizing my 30/30/3-5 home buying rule, you’d must make between $210,000 and $350,000, have a $210,000 down fee, and keep a $105,000 liquid buffer post-purchase.
If you happen to come from high-priced housing markets like San Jose, San Francisco, Los Angeles, San Diego, Seattle, New York, or Boston, you may not be as shocked by Honolulu’s excessive residence costs. Nevertheless, should you’re coming from all over the place else in America, put together to really feel the ache.
Proudly owning Actual Property in San Francisco Makes Transferring To Honolulu Simpler
The median residence worth in San Francisco is round $1,800,000, which is about 75% greater than in Honolulu. Due to this fact, transferring to Honolulu may save us round 40% if we purchase a median-priced residence.
Nevertheless, we do not desire a median-priced residence; we would like a fantastic home with ocean views or one that’s transformed and near the seaside. Sadly, these properties value over $4 million, with actually no higher restrict.
To pay for such a house with money, we would must promote a number of rental properties. This may simplify our lives as we age, however it might additionally hurt our passive income once more. After reducing our passive revenue by ~29% in 2023 resulting from a money residence buy, we do not need to make such a drastic transfer once more.
Luxurious properties in Honolulu typically take 3 – 6 months to promote, in contrast to in San Francisco, the place promoting in a single month is frequent. Given the less high-paying jobs in Honolulu, there is a larger funding threat related to shopping for luxurious actual property there.
If you happen to purchase property in Honolulu it is best to think about the home extra as a consumption expense than as an funding.
Honolulu’s Excessive Meals Prices
Produce in Honolulu is the costliest in America as a result of further delivery prices. For instance, a bag of cotton sweet grapes I purchased prices $18 at Safeway in Honolulu, in comparison with $14 in San Francisco.
Count on to pay $20 – $25 for a plate lunch, making it straightforward for a household of 4 to spend $80 – $100 for lunch, together with tax, tip, and drinks. Nevertheless, portion sizes are comparatively massive when eating out, together with meals vehicles.
Under highlights quite a lot of meals prices in Honolulu, up to date not less than annually by a group of vacationers. Regardless of the place you come from, you’ll positively really feel the burden of excessive meals prices in Honolulu.
We Develop Our Personal Fruit in Honolulu
In Hawaiian tradition, there is a saying: “If you happen to handle the land, the land will handle you.” Because of the bushes my grandparents and oldsters planted a long time in the past, we’ve got loads of fruit in our backyards.
We have now a number of mango bushes that produce over 500 mangoes a 12 months. By relocating to Honolulu, my household of 4 will guarantee these mangoes do not go to waste. We even have guava, orange, and pomelo bushes, which implies we cannot must spend a lot on breakfast if we maintain to a principally fruit morning weight-reduction plan.
Throughout our journey, our household of 4 principally shared two plate lunches and had leftovers. Many of the purpose is as a result of our kids are nonetheless younger. Nevertheless, my spouse and I’ve all the time been average eaters and are solely about 5% heavier than we had been since school.
Honolulu’s Comparatively Low Pay
The most typical suggestions from locals is the decrease pay in comparison with the mainland. We’re speaking 40%-60% decrease pay for a similar jobs. There are additionally fewer six-figure jobs obtainable, particularly in comparison with San Francisco’s tech sector. The principle industries in Honolulu are tourism, protection, agriculture, fishing, and manufacturing, which are not identified to be high-paying industries.
Based on the 2020 Census, the median family revenue in Honolulu was $96,580. The St. Louis Fed data exhibits it was $96,304 in 2022. For 2024, the family revenue is probably going nearer to $105,000 – $110,000.
Whereas not unhealthy in a vacuum, it isn’t nice in comparison with the median residence worth of $1,050,000. Consequently, it is common for 2 or three generations to reside collectively. If a family consists of two-to-four working people, a median family revenue of $100,000 is not excessive.
As of Could 2024, ZipRecruiter experiences the typical wage in Honolulu is $61,247. To personal a median-priced home and lift a household in Honolulu, it is advisable earn far above common or cohabitate with a number of working people. The monetary help of oldsters can also be fairly frequent.
We Have Sufficient Passive Earnings For Residing In Hawaii
After saving and investing since 1999, we’ve got enough passive income to help a middle-class way of life for a household of 4 in Honolulu because it’s cheaper than San Francisco. The hot button is to maintain our housing prices decrease than they’re in San Francisco. If we need to purchase a luxurious property, we could must work part-time or full-time.
Nevertheless, going again to work is one thing I stay up for as a result of I need to be a instructor at my kids’s faculty. Relocating to a brand new metropolis means making new pals and assembly new folks, and diving headfirst into my kids’s faculty group is a perfect method to try this.
As a instructor, I am going to get to know many different academics and directors, in addition to loads of new mother and father. I would love to show private finance, entrepreneurship, advertising and marketing, branding, and communications to center or highschool college students. I spent three years teaching highschool tennis and loved it for essentially the most half.
If I can not get a job educating at my kids’s colleges, I am going to proceed to jot down from residence. However as an alternative of slowly going loopy writing in a darkish room, I am going to get to jot down outdoors on a lanai overlooking the water!
If my subsequent two books do effectively (scheduled for 2025 and 2028), perhaps I am going to get one other e-book deal that retains me writing till each children graduate highschool. The pay isn’t high as an author, however writing books will present them their previous man takes lecturers significantly.
Honolulu’s Impartial Grade Faculties
Honolulu has some wonderful impartial and public schools. Since our children already attend a Mandarin immersion impartial faculty, we plan to proceed with impartial schooling initially.
My mother and father reside close to two of Honolulu’s finest impartial grade colleges: I’olani and Punahou. We toured I’olani and Punahou with our kids, and located each colleges to be superb unimaginable services. Maryknoll additionally affords a Mandarin immersion program, which is enticing if we relocate whereas our children are nonetheless younger. We extremely value learning a second language.
As a bonus, the annual tuition at I’olani and Punahou is about $13,500 lower than what we pay in San Francisco, and Maryknoll is $23,000 cheaper. The tutoring can also be the identical from Okay-12, so if we transfer when our children are older, we would pay about 50% much less since costs go up by grade in San Francisco.
The mix of higher services and decrease prices is tough to beat. I am positive the academics are great too. Nevertheless, entering into these colleges shall be difficult with out a native community to help us.
Iolani’s important entry factors are Kindergarten and sixth grade, whereas Punahou has entry factors at Okay, 4, 6, 7, and 9.
The issue shall be in entering into colleges
If our expertise with applying to preschool in San Francisco is any indication, getting each children into such impartial colleges may even be troublesome. Demand is all the time excessive, and we’re coming from San Francisco, the place we do not have a neighborhood Honolulu community to help us.
It is doable that one among our children will get in and the opposite does not. Logistically, having two children go to totally different colleges is suboptimal. Punahou has extra accommodative entry factors with Okay, 4, 6, 7, and 9. Given our children are three years aside, entry for grades 4 and seven or 6 and 9 would work.
We hope my background now as an creator supplies selection from different households who’re principally in medication, regulation, and finance. We additionally do not want tuition help for 2 children and might commonly donate.
Based mostly on the ages of our children and the colleges’ important entry factors, we’d apply within the Fall of 2029 for our daughter to enter as a 4th grader and our son to enter as a seventh grader at Punahou in 2030. Or we will apply within the Fall of 2031 for sixth grade and ninth grade in 2032.
Relocating to Honolulu in 2032 might be finest as a result of our kids will be taught extra Mandarin at our their faculty, which works till the eighth grade. We’ll get to get pleasure from our San Francisco residence we simply purchased in 2023 for 9 years.
The Worry Of Being A Stranger In A New Metropolis Is Overblown
You may concern relocating since you’ll have to begin over making pals. The stronger your friendships and household connections again residence, the more durable it’s to maneuver.
Nevertheless, as a faculty father or mother, I’ve realized how straightforward it’s to satisfy new folks and make pals if you wish to. There are limitless social features to satisfy different mother and father, together with playdates, birthdays, faculty occasions, mother and father’ nights out, and fundraisers.
As well as, you may be a part of meetups or golf equipment associated to your hobbies. My private sports club in San Francisco has supplied the most important way of life enhance for less than $175 a month. It’s been an effective way to satisfy fellow tennis and pickleball gamers.
So do not be afraid of loneliness when relocating. Honolulu has heat and welcoming residents. Simply be sure that to know the tradition, familiarize your self with Hawaiian language, and respect island traditions. As a brand new resident, attempt to give greater than you’re taking.
Promoting Property Earlier than Relocating To Honolulu
We have been accumulating properties in San Francisco since 2003. We now have 4 rental properties and one main residence in San Francisco, plus a trip property in Palisades Lake Tahoe. Our internet price is getting difficult and we would not thoughts simplifying.
Given we’d like capital to purchase a brand new residence and do not need to take care of tenant and upkeep points, we most likely must promote not less than two properties earlier than we relocate. At the moment, I handle all properties in San Francisco, which is straightforward and offers me one thing to do.
With actual property commissions coming down after the NAR price-fixing settlement, promoting now has change into extra palatable. I simply can’t get myself to pay greater than a 4% promoting fee price when expertise has lowered commissions in each different business.
On the identical time, with the tech and synthetic intelligence increase, promoting now’s laborious. I count on AI to spice up housing costs within the San Francisco Bay Space a long time to return. In addition to investing in private AI companies, the subsequent finest option to take part in AI is by proudly owning actual property in cities with the main AI corporations.
In 20 years, I am positive I’ll look again with remorse having offered a major west side San Francisco property right this moment. Due to this fact, I want to keep not less than two funding properties in San Francisco if we relocate. Possibly a property supervisor is the answer, however I’m unsure.
It is Price Residing In The Greatest Place Potential
I’ve lived overseas for 13 years in 5 international locations, labored in worldwide equities for 13 years, and traveled throughout America for the previous 47 years. Honolulu is without doubt one of the finest locations to reside within the second half of your life.
There is a purpose why Hawaii residents have the longest life expectancy in America: a greater, extra stress-free way of life. As soon as you have accrued sufficient wealth, having a protracted and wholesome life turns into a precedence.
Sure, there are downsides to dwelling in Honolulu, similar to site visitors, greater costs, comparatively excessive state revenue taxes, and island fever. It would even be harder “making it in Hawaii” until you’re in medication, regulation, or an entrepreneur. Even then, it is powerful to grind so laborious when island life is so stress-free. Lastly, the tempo of life is way slower, which can be laborious to regulate to.
Nevertheless, I imagine the positives far outweigh the negatives. As soon as you have constructed sufficient wealth, your objective needs to be to reside as lengthy and as wholesome a life as doable.
Winding Down In Honolulu In The Second Half Of Life
I need to put on shorts and t-shirts year-round. It could be good to swim within the ocean within the mornings and play tennis within the evenings. Residing in a medium-sized metropolis additionally supplies sufficient work alternatives to remain productive, however not a lot that you just really feel overwhelmed by competitors. Most of all, I need my household to be secure and comfortable.
Honolulu supplies all this stuff. Nevertheless, we cannot know till we attempt to relocate in 2030 on the earliest. Ideally, we relocate in 2032 when our son is in ninth grade and our daughter is in sixth grade. This timeline will maximize our time in our new home, profit from the AI increase, and provides us time to house out the sale of our properties.
Within the meantime, we shall be sending our children to summer season faculty in Honolulu for not less than a month so we will strive earlier than we purchase!
If you happen to reside and work in Honolulu, I would love to listen to your ideas! What are another negatives and positives we must always learn about earlier than relocating?
Do not Stop Your Job To Relocate To Honolulu
If you happen to’re planning to depart your job for a brand new one in Honolulu, I would attempt to negotiate a severance package deal as an alternative of quitting. You’ll admire the monetary runway given pay is usually decrease in Honolulu.
Try How To Engineer Your Layoff, the very best useful resource to show you the best way to negotiate a severance package deal. Use “saveten” at checkout to save lots of $10. I’ve up to date the e-book six occasions with new methods and insights since 2012.
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