Navigating Todays Market
Private lending has become a cornerstone strategy for real estate investors in Hawaii, especially as the state’s property market remains competitive and traditional financing becomes increasingly restrictive. Here’s what you need to know about leveraging private lending in Hawaii’s current real estate landscape, including its benefits, strategies, and key considerations.
Why Private Lending Is Thriving in Hawaii
As of June 2025, Hawaii remains in a severe housing crisis with high prices and elevated mortgage rates making homeownership unaffordable for most residents. Less than 25% of Hawaii households earned enough in 2024 to afford a mortgage on the median single-family home, which was priced at $950,0002. The state now has the highest homelessness rate in the country, reflecting the acute housing pressures.
Speed and Flexibility:
In Hawaii’s fast-moving real estate market, private lenders offer quick access to funds—often closing deals in as little as five business days. This agility is crucial for investors aiming to secure desirable properties, such as short-term rentals or fix-and-flip opportunities, before competitors can act.
Flexible Terms:
Unlike banks, private lenders can tailor loan terms to fit the unique needs of each project. Investors can negotiate interest rates, payment schedules, and collateral requirements, making it easier to align financing with investment strategies or cash flow projections.
Less Stringent Requirements:
Kauai Performance-Kauai’s market has shown mixed results, with island-wide home sales increasing 8.87% year-to-date compared to 2024. The South Shore experienced particularly strong growth with a 54.55% increase in sales, while the North Shore saw a 40% decline. Median prices have shifted across different regions, with the North Shore seeing a 13.10% increase to $2,375,000.
Key Benefits for Hawaii Investors
Rapid Funding:
Essential for seizing opportunities in Hawaii’s highly competitive market, especially for short-term rentals in tourism hotspots like Honolulu or Maui.
Customized Solutions:
Loan terms can be adapted to suit unique projects, from ground-up construction to quick rehabs or cash-out refinances.
Broader Access:
Investors with less-than-perfect credit or limited experience can still participate in lucrative deals, fostering a more inclusive investment environment.
Higher Leverage:
Private loans in Hawaii typically cover 65-80% of a property’s value, providing significant capital with a manageable down payment..
Benefits for Private Lenders
Higher Returns:
Earn attractive interest rates (typically 8%–12%), much higher than traditional savings or bonds. WIth us you’ll earn 12-15%
Asset-Backed Security:
Loans are secured by real estate, providing collateral in case of default.
Shorter Terms:
Most loans are short-term (6–36 months), allowing quicker reinvestment and flexibility.
Portfolio Diversification:
Offers exposure to Hawaii’s real estate market, diversifying away from stocks or traditional assets.
Flexible Terms:
Lenders can negotiate rates, fees, and conditions to suit their preferences and risk tolerance.
Strong Demand:
Hawaii’s competitive market ensures a steady flow of qualified borrowers seeking fast, flexible financing.
Current Market 2025
Hawaii’s real estate market in mid-2025 is experiencing a split, with single-family homes remaining resilient and condos shifting toward a buyer’s market. Home prices are holding steady or even rising in desirable areas, thanks to tight inventory and many homeowners holding onto low-rate mortgages. Meanwhile, condo inventory is growing, prices are softening, and days on market are increasing, offering more opportunities for selective buyers and investors.
For investors, this environment means strong demand for flexible financing, especially from private lenders who can earn attractive returns and benefit from asset-backed security. If you’re interested in becoming a private lender with us and tapping into Hawaii’s dynamic real estate market, leave a comment—we’d love to connect!
