After taking my household on a nine-day trip to Honolulu, Hawaii, my plan to relocate there may be again within the playing cards! Since 2014, two years after retiring from my finance job, I have been considering transferring again to Honolulu to spend extra time with my dad and mom. Nonetheless, really making the transfer has been a lot tougher than anticipated.
Simply as financially insecure folks typically inform themselves “only one extra yr” earlier than retiring, I have been saying “possibly subsequent yr” about transferring 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 acquired into a faculty he enjoys immensely, and now our daughter has joined the identical college, which we consider she’ll additionally get pleasure from. Because of this, the inertia of life has stored us in San Francisco.
Nonetheless, with my dad and mom now of their mid-70s, the time to spend extra time with them is now. Our youngsters additionally dealt with their longest time away from residence effectively. Though, they complained concerning the warmth, they missed it as soon as we returned. My considerations about them adjusting to a brand new atmosphere have diminished.
For background, my grandparents have been born and raised in Honolulu, so was my dad. My grandmother is half native Hawaiian as effectively. Each my dad and mom are retired in Honolulu.
The Challenges of Dwelling in Honolulu, Hawaii
There are three principal challenges of residing in Honolulu: housing, meals, and work. For those who plan to ship your kids to personal college, affording the schooling and getting accepted are additionally important challenges.
Let’s talk about every problem for those who’re contemplating residing and dealing in Honolulu. You probably have ever lived and labored in Honolulu or at the moment do, I might love your insights as effectively.
Honolulu’s Excessive House Costs
Honolulu boasts one of many highest median residence costs within the nation at roughly $1,050,000. In the meantime, Zillow has the median Honolulu residence value round $800,000, however I do not belief Zillow. When home looking, it typically appears that houses value way more than the median value, irrespective of town. Humorous how that’s.
To afford a median-priced residence utilizing my 30/30/3-5 residence shopping for rule, you’d have to make between $210,000 and $350,000, have a $210,000 down fee, and preserve a $105,000 liquid buffer post-purchase.
For those who come from high-priced housing markets like San Jose, San Francisco, Los Angeles, San Diego, Seattle, New York, or Boston, you won’t be as shocked by Honolulu’s excessive residence costs. Nonetheless, for those who’re coming from in every single place else in America, put together to really feel the ache.
Proudly owning Actual Property in San Francisco Makes Shifting To Honolulu Simpler
The median residence value in San Francisco is round $1,800,000, which is about 75% increased than in Honolulu. Due to this fact, transferring to Honolulu may save us round 40% if we purchase a median-priced residence.
Nonetheless, we do not desire a median-priced residence; we would like a incredible residence with ocean views or one that’s reworked and near the seashore. Sadly, these houses value 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 attributable to a money residence buy, we do not need to make such a drastic transfer once more.
Luxurious houses in Honolulu typically take 3 – 6 months to promote, in contrast to 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.
For those who 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 because of the 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.
Anticipate to pay $20 – $25 for a plate lunch, making it simple 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 vans.
Beneath highlights quite a lot of meals prices in Honolulu, up to date at the least every year by a group of vacationers. Regardless of the place you come from, you’ll undoubtedly really feel the burden of excessive meals prices in Honolulu.
We Develop Our Personal Fruit in Honolulu
In Hawaiian tradition, there is a saying: “For those who care for the land, the land will care for you.” Because of the bushes my grandparents and fogeys planted many years in the past, we’ve loads of fruit in our backyards.
Now we have a number of mango bushes that produce over 500 mangoes a yr. 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 principally fruit morning eating regimen.
Throughout our journey, our household of 4 principally shared two plate lunches and had leftovers. Many of the purpose is as a result of our kids 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 faculty.
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 accessible, particularly in comparison with San Francisco’s tech sector. The primary industries in Honolulu are tourism, protection, agriculture, fishing, and manufacturing, which are not identified to be high-paying industries.
In accordance with the 2020 Census, the median family earnings in Honolulu was $96,580. The St. Louis Fed information exhibits 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 is not nice in comparison with the median residence value of $1,050,000. Consequently, it’s normal 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 reviews the common wage in Honolulu is $61,247. To personal a median-priced home and lift a household in Honolulu, that you must earn far above common or cohabitate with a number of working people. The monetary assist of fogeys can be fairly widespread.
We Have Sufficient Passive Earnings For Dwelling In Hawaii
After saving and investing since 1999, we’ve sufficient passive earnings to assist a middle-class life-style for a household of 4 in Honolulu because it’s cheaper than San Francisco. The secret’s 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 look ahead to as a result of I need to be a trainer at my kids’s college. Relocating to a brand new metropolis means making new buddies and assembly new folks, and diving headfirst into my kids’s college group is a perfect means to try this.
As a trainer, I am going to get to know many different academics and directors, in addition to loads of new dad and mom. 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 can not get a job instructing at my kids’s colleges, I am going to proceed to write down from residence. However as an alternative of slowly going loopy writing in a darkish room, I am going to get to write down exterior on a lanai overlooking the water!
If my subsequent two books do effectively (scheduled for 2025 and 2028), possibly I am going to get one other e-book deal that retains me writing till each youngsters graduate highschool. The pay is not excessive as an creator, however writing books will present them their outdated man takes lecturers critically.
Honolulu’s Unbiased Grade Colleges
Honolulu has some glorious unbiased and public colleges. Since our children already attend a Mandarin immersion unbiased college, we plan to proceed with unbiased schooling initially.
My dad and mom stay close to two of Honolulu’s greatest unbiased grade colleges: ‘Iolani and Punahou. We toured ‘Iolani and Punahou with our kids, and located each colleges to be superb unimaginable amenities. Maryknoll additionally affords a Mandarin immersion program, which is enticing if we relocate whereas our children are nonetheless younger. We extremely worth studying a second language.
As a bonus, the annual tuition at ‘Iolani and Punahou is about $13,500 lower than what we pay in San Francisco, and Maryknoll is $23,000 cheaper. The tutoring can be the identical from Okay-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 mixture of higher amenities and decrease prices is difficult to beat. I am certain the academics are fantastic too. Nonetheless, stepping into these colleges shall be difficult with out a native community to assist us.
Iolani’s principal entry factors are Kindergarten and sixth grade, whereas Punahou has entry factors at Okay, 4, 6, 7, and 9.
The issue shall be in stepping into colleges
If our expertise with making use of to preschool in San Francisco is any indication, getting each youngsters into such unbiased colleges can even be tough. Demand is at all times excessive, and we’re coming from San Francisco, the place we do not have an area Honolulu community to assist us.
It is potential that one among our children will get in and the opposite does not. Logistically, having two youngsters go to totally different colleges is suboptimal. Punahou has extra accommodative entry factors with Okay, 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 creator offers selection from different households who’re principally in drugs, legislation, and finance. We additionally do not want tuition help for 2 youngsters and might frequently donate.
Based mostly on the ages of our children and the colleges’ principal entry factors, we’d 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 greatest as a result of our kids will be taught extra Mandarin at their college, which works till the eighth grade. We’ll get to get pleasure from our San Francisco residence we simply purchased in 2023 for 9 years.
The Concern Of Being A Stranger In A New Metropolis Is Overblown
You would possibly concern relocating since you’ll have to start out over making buddies. The stronger your friendships and household connections again residence, the tougher it’s to maneuver.
Nonetheless, as a faculty father or mother, I’ve realized how simple it’s to fulfill new folks and make buddies if you wish to. There are countless social features to fulfill different dad and mom, together with playdates, birthdays, college occasions, dad and mom’ nights out, and fundraisers.
As well as, you’ll be able to be part of meetups or golf equipment associated to your hobbies. My personal sports activities membership in San Francisco has supplied the most important life-style increase for less than $175 a month. It’s been a good way to fulfill fellow tennis and pickleball gamers.
So do not be afraid of loneliness when relocating. Honolulu has heat and welcoming residents. Simply be sure 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.
As for the children, it’s higher in the event that they relocate to a brand new metropolis once they have been youthful. It will likely be robust to go away their buddies in SF, however they are going to make new buddies. Apart from, their college solely goes to the eighth grade, which implies they ultimately should reapply anyway.
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 want capital to purchase a brand new residence and do not need to take care of tenant and upkeep points, we most likely have to promote at the least two properties earlier than we relocate. At the moment, I handle all properties in San Francisco, which is simple and provides me one thing to do.
With actual property commissions coming down after the NAR price-fixing settlement, promoting now has turn into extra palatable. I simply can’t get myself to pay greater than a 4.5% promoting fee fee when know-how has lowered commissions in each different trade.
On the identical time, with the tech and synthetic intelligence growth, promoting now’s laborious. I anticipate AI to spice up housing costs within the San Francisco Bay Space many years to return. Apart from investing in personal AI firms, the following greatest solution to take part in AI is by proudly owning actual property in cities with the main AI firms.
In 20 years, I am certain I’ll look again with remorse having bought a major west aspect San Francisco property at this time. Due to this fact, I want to preserve at the least two funding properties in San Francisco if we relocate. Perhaps a property supervisor is the answer, however I’m unsure.
It is Value Dwelling In The Finest Place Doable
I’ve lived overseas for 13 years in 5 nations, labored in worldwide equities for 13 years, and traveled throughout America for the previous 47 years. Honolulu is likely one of the greatest 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 stress-free life-style. As soon as you have gathered sufficient wealth, having a protracted and wholesome life turns into a precedence.
Sure, there are downsides to residing in Honolulu, corresponding to visitors, increased costs, comparatively excessive state earnings taxes, and island fever. It is going to even be harder “making it in Hawaii” until you’re in drugs, legislation, or an entrepreneur. Even then, it is robust to grind so laborious when island life is so stress-free. Lastly, the tempo of life is way slower, which will also be laborious to regulate to.
Nonetheless, I consider the positives far outweigh the negatives. As soon as you have 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 could be good to swim within the ocean within the mornings and play tennis within the evenings. Dwelling in a medium-sized metropolis additionally offers sufficient work alternatives to remain productive, however not a lot that you just 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 growth, and provides us time to house out the sale of our properties.
Within the meantime, we shall be sending our children to summer time college in Honolulu for at the least a month so we will strive earlier than we purchase!
For those who stay and work in Honolulu, I might love to listen to your ideas! What are another negatives and positives we must always learn about earlier than relocating?
Do not Give up Your Job To Relocate To Honolulu
For those who’re planning to go away your job for a brand new one in Honolulu, I might attempt to negotiate a severance bundle as an alternative of quitting. You’ll recognize the monetary runway given pay is commonly decrease in Honolulu.
Try How To Engineer Your Layoff, the very best useful resource to show you the right way to negotiate a severance bundle. Use “saveten” at checkout to avoid wasting $10. I’ve up to date the e-book six occasions with new methods and insights since 2012.
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