Hawaii is a favorite place for real estate investors. There are many compelling economic reasons that drive the investors to Hawaii besides the natural beauty, sandy beaches, warm water and the mild weather all year round of this tropical paradise:

Land Is Scarce Located in the middle of the Pacific Ocean with an area of 10,000 square miles, Hawaii islands have very limited land mass. Because of the volcanic and mountainous terrains, the land that is suitable to build is even more limited. The vast majority of the land in Hawaii is either preserved or zoned for agricultural use making the land for urban living extremely scarce and at a premium.

Low Unemployment Rate People in Hawaii islands consistently enjoy a below the national average unemployment rate. Even at the midst of severe global economic recession, the unemployment rate for Hawaii is 7.4% compared to 9.6 nationally. In Oahu, the unemployment situation is relatively mild at around 6%.

Global Investment Investments are pouring in not just from the United States. Hawaii has been the beneficiary of investments noticeably from Canada, Japan, Korea, and many other parts of the world. Trump Tower Waikiki was sold in one day. Many of the buyers were international buyers.

Military Spending For decades, US military has a strong presence on the islands, particularly on Oahu. Because of base closings in Okinawa, many military units are relocating to Guam and Hawaii. With housing supplemental income, retired and active military personnels have strong buying power on the Hawaii real estate market.

Low Property Tax Rates Thanks to the incomes from the tourist industry, home owners in Hawaii enjoy one of lowest property tax rates in the nation. The funding for local schools are provided by the state government, and are not entirely supported from the property taxes like many other states. The sale tax for Hawaii is also relatively moderate at 4.5%.

Highest Median Gross Rent Both 1990 and 2000 census data showed that Hawaii had the highest median gross rents in the nation, surpassed any other states. High rent keeps the rental market stable and the vacancy rate low making Hawaii one of most attractive places for real estate investors.