Dreaming of owning a slice of paradise on Hawai‘i’s Big Island? The Kohala Coast—with its world-class resorts, sunny weather, and postcard-perfect beaches—is a magnet for vacationers and investors alike. But before you dive into the vacation rental market, it’s essential to understand what sets this coast apart—and what to look for to make a smart, sustainable investment.

Whether you’re eyeing to buy a luxury condo at Mauna Lani, a golf-front villa in Waikoloa Beach Resort, or a private home in Puako, here’s what to consider before purchasing a vacation rental on the Kohala Coast on the Island of Hawaii.

1. Location of Your Vacation Rental Matters More Than Ever

Not all areas of the Big Island are created equal. The Kohala Coast’s reputation for high-end tourism, upscale resorts, and year-round sunshine makes it the most lucrative short-term rental zone on the island. But even within this stretch, micro-location matters:

• Waikoloa Beach Resort is ideal for active travelers with its shops, restaurants, golf courses, and proximity to ‘Anaeho‘omalu Bay.
• Mauna Lani Resort offers serenity, luxury, and eco-conscious development—a favorite among families and repeat visitors.
• Mauna Kea Resort appeals to ultra-high-net-worth travelers seeking exclusivity and iconic beaches.
• Puako is beloved for its oceanfront homes and local beach charm—but has fewer amenities within walking distance.

Pro tip: Look for properties within walking distance to beaches or resort amenities. These command higher nightly rates and attract more repeat guests.

2. Know the Zoning and Legal Landscape

Hawai‘i Island’s vacation rental rules are county-specific, and enforcement has tightened in recent years. Fortunately, the Kohala Coast’s resort areas—Waikoloa Beach, Mauna Lani, and Mauna Kea—are within designated Resort Nodes, where short-term rentals are allowed by right.

Still, it's important to:

• Confirm that the property is in a V (resort) zoning district or has a Short-Term Vacation Rental (STVR) permit.
• Ensure HOA rules allow vacation rentals—some communities have restrictions or minimum night stays

Pro tip: Hire a real estate agent who specializes in resort investment properties and understands both county law and HOA bylaws.

3. Understand the Income Potential - and Seasonality

While the Kohala Coast commands some of the highest nightly rates in the state, occupancy fluctuates with seasonality. Peak periods include:

• Winter holidays (mid-December through January)
• Spring break (March)
• Summer vacation season (June-August)
• Special Events (Ironman, Easter, Thanksgiving, etc)

Low seasons (April-May and September) may require creative marketing or discounted rates to maintain occupancy.

When evaluating a vacation rental property to purchase, analyze:

• Average Daily Rate (ADR) and Occupancy Rate in the resort or complex.
• Historical performance if the unit was previously a rental.
• Future income potential based on amenities, view, and upgrades.

Pro tip: A well-managed unit in a desirable location can outperform the market. Focus on guest experience and professional management to drive 5-star reviews and repeat bookings.

4. Factor in Property Management Early

Managing a short-term rental remotely—especially in Hawai‘i—requires time, local knowledge, and a trustworthy team on the ground. The best-performing homes on the Kohala Coast often work with professional property management companies that:

• Handle bookings, guest communication, cleaning, and maintenance.
• Ensure compliance with tax and legal regulations
• Market your home across multiple platforms (Airbnb, Vrbo, Expedia, Booking.com, Costco Travel, travel agents, branded websites, and other distribution channels)
• Have been managing local vacation rentals for 10+ years and know the industry nuances.

Choosing the right partner can make the difference between a passive income stream and a second full-time job.

Pro tip: Interview local property managers before you buy. Ask about their pricing strategy, guest screening, and how they maintain luxury standards.

5. Understand the Cost of Ownership in Hawai'i

From property taxes to insurance to HOA dues and maintenance, owning a vacation home in Hawai‘i comes with unique costs:

• Utilities are higher due to shipping and fuel costs
• Insurance premiums are elevated, especially for coastal properties
• HOA fees can range from $600 to $2,500/month depending on the resort and amenities

It's essential to model net cash flow after all expenses - not just gross revenue.

Pro tip: Budget for capital reserves (e.g., new AC, appliances, or furnishings every 5-10 years). Quality pays off in the guest experience—and your bottom line.

Final Thought: The Kohala Coast Advantage

While the Big Island has a range of climates and vacation rental rules, the Kohala Coast is where location, luxury, and lifestyle converge. If you’re looking for a high-performing investment that doubles as your personal Hawaiian retreat, this is where you’ll find it.

When you’re ready to buy, connect with local experts—real estate pros and property managers—who know the nuances of each resort and can help you maximize your return.

Interested in learning more about managing your Kohala Coast vacation rental?

Contact CoralTree Residence Collection to explore full-service property management in Hawaii tailored to luxury resort homes.