Owning a second home in Hawaii is a dream—but it can also come with eye-popping expenses. With annual costs averaging $29,015 per year (and much higher along the Kohala Coast), Hawaii leads the nation in homeownership costs, thanks to steep property taxes, high insurance premiums, and soaring utility bills. Whether your home is in Mauna Lani, Waikoloa Beach Resort, Puako, or Mauna Kea, here’s how to take control of rising costs, protect your investment, and create new revenue—without sacrificing the lifestyle that brought you here in the first place.

1. Control What You Can: Reduce Operational Costs

• Challenge Your Property Tax Assessment - Hawaii allows property owners to appeal property tax assessments. If your property’s value was inflated compared to recent comparable sales, you may be overpaying. A local real estate professional or property tax consultant can help prepare an appeal and gather comps.
• Perform Preventative Maintenance - A leaky roof or aging appliance may seem minor—until it costs you a booking, causes water damage, or creates mold. Build a preventative maintenance calendar (monthly, quarterly, and annually) to stay ahead of:
  • Water intrusion
  • HVAC breakdowns
  • Pest infestations
  • Storm preparation
• Invest in Energy Efficiency - Hawaii’s utility bills are the highest in the country—averaging $3,976/year. Modern energy-efficient upgrades pay for themselves faster here:
  • Smart thermostats and occupancy sensors
  • Solar water heaters
  • Energy Star-rated appliances
  • LED lighting and smart lighing systems
• Install A/C Door Sensors (for Rentals) - Open lanai doors with A/C running = higher energy bills and mold risk in your ducts. Install door sensors that auto-disable A/C when exterior doors are open. These inexpensive devices reduce wear and tear and prevent humidity issues.

Pro tips: If your property is a rental, ask your manager for data on energy usage by guest—targeted upgrades in problem areas will yield immediate returns. Also, a proactive maintenance plan avoids emergency repair costs and revenue loss from downtime.

2. Create Cash Flow: Rent Your Home Strategically

If your home sits empty for much of the year, you’re leaving tens of thousands in potential revenue on the table.

• Consider Renting (If You Aren’t Already) - Even renting for part of the year can offset major ownership costs. Short-term rental income can cover:
  • HOA dues
  • Utilities
  • Property taxes
  • Maintenance reserves
• Choose a Performance-Driven Property Manager - Not all managers are equal. A quality partner should:
  • Maximize occupancy without discounting rates
  • Suggest upgrades that drive bookings (e.g. furnishings, amenity packages, extra perks that move the needle like bikes or beach equipment)
  • Proactively prevent downtime with tight operations
  • Optimize your pricing to reflect market trends and seasonality
• Make Your Home Stand Out - Guests have dozens of options. Invest in what makes yours the “obvious choice”:
  • Local artwork or Hawaiian design touches
  • Fully stocked kitchen and beach gear
  • Smart TVs, high-speed internet, and work-friendly nooks
  • Luxurious outdoor seating and sunset-facing features
  • Resort transportation such as bikes or a golf cart
  • Sports equipment for guest use like golf clubs, pickleball rackets, tennis balls and rackets

Pro tip: Ask what percentage of your annual expenses could be covered with their rental plan - then hold them accountable to those results.

3. Protect the Asset: Think Long-Term

• Track Maintenance and Capital Expenditures Like a Business - Use a simple spreadsheet or management software to track:
  • Routine maintenance
  • Repairs
  • Appliance ages
  • Roof, paint, A/C lifecycle
• Ensure You're Properly Insured - Hurricanes, floods, earthquakes, and wildfires are increasing in frequency. Make sure your coverage reflects today’s values and includes:
  • Loss of rental income coverage
  • Flood, huricane, or lava flow insurance (depending on zone)
  • Personal liability (especially if you rent)
• Explore Tax Strategies - If you rent your home for part of the year, you may be able to deduct:
  • Utilities
  • Property management fees
  • Maintenance costs
  • Pro-rated mortgage interest

Pro Tips: Re-shop your insurance policy annually as rates and underwriters change fast in Hawaii. Also, speak with a CPA who understands Hawaii real estate taxation.

Final Thought: Your Home Should Work for You

Whether your Hawaii home is a peaceful retreat or a part-time income generator, you don’t have to absorb rising costs passively. A smart mix of efficiency upgrades, strategic rental income, and expert support can turn your second home into a resilient, self-sustaining asset. Not sure where to start? Speak with a local property management team who can assess your home’s earning potential and help you build a strategy tailored to your goals.

Ready to explore a vacation rental partnership? Let's talk!