After taking my household on a nine-day trip to Honolulu, Hawaii, my plan to relocate there’s again within the playing cards! Since 2014, two years after retiring from my finance job, I have been considering shifting again to Honolulu to spend extra time with my mother and father. Nonetheless, truly making the transfer has been a lot tougher than anticipated.
Simply as financially insecure folks typically inform themselves “only one extra 12 months” earlier than retiring, I have been saying “perhaps subsequent 12 months” about shifting 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 college, which we consider she’ll additionally get pleasure from. In consequence, the inertia of life has stored us in San Francisco.
Nonetheless, 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 house properly. Though, they complained in regards to the warmth, they missed it as soon as we returned.
My issues about them adjusting to a brand new surroundings have diminished.
The Challenges of Residing in Honolulu, Hawaii
There are three major challenges of dwelling in Honolulu: housing, meals, and work. In the event you plan to ship your kids to personal college, affording the tutoring and getting accepted are additionally important challenges.
Let’s talk about every problem if you happen to’re contemplating dwelling and dealing in Honolulu. When you have ever lived and labored in Honolulu or at the moment do, I might love your insights as properly.
Honolulu’s Excessive Residence Costs
Honolulu boasts one of many highest median house costs within the nation at roughly $1,050,000. In the meantime, Zillow has the median Honolulu house worth round $800,000, however I do not belief Zillow. When home searching, it typically appears that properties price way more than the median worth, irrespective of town. Humorous how that’s.
To afford a median-priced house utilizing my 30/30/3-5 house shopping for rule, you’d have to make between $210,000 and $350,000, have a $210,000 down cost, and preserve a $105,000 liquid buffer post-purchase.
In the event you 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 house costs. Nonetheless, if you happen to’re coming from in all places else in America, put together to really feel the ache.
Proudly owning Actual Property in San Francisco Makes Transferring To Honolulu Simpler
The median house worth in San Francisco is round $1,800,000, which is about 75% increased than in Honolulu. Due to this fact, shifting to Honolulu may save us round 40% if we purchase a median-priced house.
Nonetheless, we do not desire a median-priced house; we wish a unbelievable house with ocean views or one that’s reworked and near the seaside. Sadly, these properties price over $4 million, with actually no higher restrict.
To pay for such a house with money, we would have to promote a number of rental properties. This is able to simplify our lives as we age, however it might additionally damage our passive earnings once more. After chopping our passive earnings by ~29% in 2023 on account of a money house buy, we do not need to make such a drastic transfer once more.
Luxurious properties in Honolulu typically take 3 – 6 months to promote, not like in San Francisco, the place promoting in a single month is widespread. Given the less high-paying jobs in Honolulu, there is a larger funding threat related to shopping for luxurious actual property there.
In the event you purchase property in Honolulu it is best to consider the home extra as a consumption expense than as an funding.
Honolulu’s Excessive Meals Prices
Produce in Honolulu is the most costly 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. Nonetheless, portion sizes are comparatively giant when eating out, together with meals vehicles.
Under highlights a wide range of meals prices in Honolulu, up to date no less than annually by a neighborhood 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: “In the event you maintain the land, the land will maintain you.” Because of the bushes my grandparents and fogeys planted a long time in the past, we have now loads of fruit in our backyards.
We’ve got 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 have to spend a lot on breakfast if we preserve to a largely fruit morning weight loss plan.
Throughout our journey, our household of 4 largely shared two plate lunches and had leftovers. Many of the purpose is as a result of our youngsters are nonetheless younger. Nonetheless, my spouse and I’ve at all times been reasonable eaters and are solely about 5% heavier than we have 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 out there, particularly in comparison with San Francisco’s tech sector. The principle industries in Honolulu are tourism, protection, agriculture, fishing, and manufacturing, which are not recognized to be high-paying industries.
Based on the 2020 Census, the median family earnings in Honolulu was $96,580. The St. Louis Fed knowledge reveals it was $96,304 in 2022. For 2024, the family earnings is probably going nearer to $105,000 – $110,000.
Whereas not unhealthy in a vacuum, it isn’t nice in comparison with the median house worth of $1,050,000. Consequently, it is common for 2 or three generations to stay collectively. If a family consists of two-to-four working people, a median family earnings of $100,000 is not excessive.
As of Could 2024, ZipRecruiter studies the common wage in Honolulu is $61,247. To personal a median-priced home and lift a household in Honolulu, it’s good to earn far above common or cohabitate with a number of working people. The monetary help of oldsters can also be fairly widespread.
We Have Sufficient Passive Revenue For Residing In Hawaii
After saving and investing since 1999, we have now sufficient passive earnings to help a middle-class life-style for a household of 4 in Honolulu because it’s cheaper than San Francisco. The bottom line is to maintain our housing prices decrease than they’re in San Francisco. If we need to purchase a luxurious property, we might have to work part-time or full-time.
Nonetheless, going again to work is one thing I sit up for as a result of I need to be a instructor at my kids’s college. Relocating to a brand new metropolis means making new mates and assembly new folks, and diving headfirst into my kids’s college neighborhood is a perfect means to try this.
As a instructor, I am going to get to know many different lecturers and directors, in addition to loads of new mother and father. I might 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 probably the most half.
If I am unable to get a job instructing at my kids’s faculties, I am going to proceed to jot down from house. However as a substitute 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 properly (scheduled for 2025 and 2028), perhaps I am going to get one other ebook deal that retains me writing till each children graduate highschool. The pay is not excessive as an writer, however writing books will present them their previous man takes teachers critically.
Honolulu’s Unbiased Grade Faculties
Honolulu has some wonderful impartial and public faculties. Since our children already attend a Mandarin immersion impartial college, we plan to proceed with impartial schooling initially.
My mother and father stay close to two of Honolulu’s finest impartial grade faculties: I’olani and Punahou. We toured I’olani and Punahou with our youngsters, and located each faculties to be superb unbelievable services. Maryknoll additionally provides a Mandarin immersion program, which is engaging if we relocate whereas our children are nonetheless younger. We extremely worth studying 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 schooling can also be the identical from Ok-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 lecturers are fantastic too. Nonetheless, entering into these faculties might be difficult with out a native community to help us.
Iolani’s major entry factors are Kindergarten and sixth grade, whereas Punahou has entry factors at Ok, 4, 6, 7, and 9.
The problem might be in entering into faculties
If our expertise with making use of to preschool in San Francisco is any indication, getting each children into such impartial faculties may also be troublesome. Demand is at all times excessive, and we’re coming from San Francisco, the place we do not have a neighborhood Honolulu community to help us.
It is potential that considered one of our children will get in and the opposite would not. Logistically, having two children go to totally different faculties is suboptimal. Punahou has extra accommodative entry factors with Ok, 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 writer offers selection from different households who’re largely in drugs, legislation, and finance. We additionally do not want tuition help for 2 children and may usually donate.
Primarily based on the ages of our children and the faculties’ major entry factors, we might 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 youngsters will be taught extra Mandarin at our their college, which fits till the eighth grade. We’ll get to get pleasure from our San Francisco house 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 start out over making mates. The stronger your friendships and household connections again house, the tougher it’s to maneuver.
Nonetheless, as a faculty mother or father, I’ve realized how straightforward it’s to satisfy new folks and make mates if you wish to. There are limitless social capabilities to satisfy different mother and father, together with playdates, birthdays, college occasions, mother and father’ nights out, and fundraisers.
As well as, you may be part of meetups or golf equipment associated to your hobbies. My personal sports activities membership in San Francisco has offered the most important life-style increase for less than $175 a month. It’s been a good 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 certain that to grasp the tradition, familiarize your self with Hawaiian language, and respect island traditions. As a brand new resident, attempt to give greater than you are 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 major residence in San Francisco, plus a trip property in Palisades Lake Tahoe. Our web value is getting difficult and we would not thoughts simplifying.
Given we’d like capital to purchase a brand new house and do not need to take care of tenant and upkeep points, we most likely have to promote no less than two properties earlier than we relocate. Presently, I handle all properties in San Francisco, which is straightforward and provides me one thing to do.
With actual property commissions coming down after the NAR price-fixing settlement, promoting now has turn out to be extra palatable. I simply can’t get myself to pay greater than a 4% promoting fee fee when expertise has lowered commissions in each different trade.
On the similar time, with the tech and synthetic intelligence increase, promoting now could be laborious. I anticipate AI to spice up housing costs within the San Francisco Bay Space a long time to come back. Apart from investing in personal AI firms, the subsequent finest approach to take part in AI is by proudly owning actual property in cities with the main AI firms.
In 20 years, I am positive I’ll look again with remorse having offered a primary west facet San Francisco property in the present day. Due to this fact, I want to preserve no 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 Doable
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 stay within the second half of your life.
There is a purpose why Hawaii residents have the longest life expectancy in America: a greater, extra enjoyable life-style. As soon as you’ve got collected sufficient wealth, having an extended and wholesome life turns into a precedence.
Sure, there are downsides to dwelling in Honolulu, similar to site visitors, increased costs, comparatively excessive state earnings taxes, and island fever. It’s going to even be harder “making it in Hawaii” until you’re in drugs, legislation, or an entrepreneur. Even then, it is powerful to grind so laborious when island life is so enjoyable. Lastly, the tempo of life is way slower, which may also be laborious to regulate to.
Nonetheless, I consider the positives far outweigh the negatives. As soon as you’ve got constructed sufficient wealth, your purpose ought to be to stay as lengthy and as wholesome a life as potential.
Winding Down In Honolulu In The Second Half Of Life
I need to put on shorts and t-shirts year-round. It will be good to swim within the ocean within the mornings and play tennis within the evenings. Residing in a medium-sized metropolis additionally offers sufficient work alternatives to remain productive, however not a lot that you simply really feel overwhelmed by competitors. Most of all, I need my household to be protected and blissful.
Honolulu offers all this stuff. Nonetheless, 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 might be sending our children to summer time college in Honolulu for no less than a month so we will attempt earlier than we purchase!
In the event you stay and work in Honolulu, I might love to listen to your ideas! What are another negatives and positives we must always find out about earlier than relocating?
Do not Give up Your Job To Relocate To Honolulu
In the event you’re planning to depart your job for a brand new one in Honolulu, I might attempt to negotiate a severance package deal as a substitute of quitting. You’ll admire the monetary runway given pay is usually decrease in Honolulu.
Take a look at How To Engineer Your Layoff, the most effective useful resource to show you the right way to negotiate a severance package deal. Use “saveten” at checkout to avoid wasting $10. I’ve up to date the ebook six instances with new methods and insights since 2012.
To expedite your journey to monetary freedom, be part of over 60,000 others and subscribe to the free Monetary Samurai publication. Monetary Samurai is among the many largest independently-owned private finance web sites, established in 2009.
