1 Bay Dr #4704

Kapalua, HI 96761

$199,000F

2 bd · 2.5 ba · 1,774 sqft · Built 2008 · Condo · Active · 455 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,625/mo
• Mortgage (P&I): −$1,044
• Tax + insurance: −$332
• HOA: −$4,882
• Vac / Maint / Mgmt: −$971
• Net cashflow: $-2,604/mo
• Annual: $-31,245/yr
• Cap rate: -9.41%
• Cash-on-cash: -56.07%
• DSCR: -1.50
• 1% rule: 2.32%
• Cash to close: $55,720

Investor read

• This is a 2-bed/2.5-bath condo listed at $199k.
• At list price, monthly cash flow is $-3k ($-31k/yr) — negative.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($5k rent vs $199k).
• It's been on market 455 days — a 12% lower offer ($175k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $175k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads 59/100 on livability (#102 in HI) — a working-class tenant base; expect higher turnover. Strengths: crime A+, employment A+; Watch: health & safety C-, amenities F, commute F.
• Hawaii Department Of Education (suburban): math 32% / reading 50% proficiency, ranked #1 of 1 in HI (top 100%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: HOA is 106% of rent.
• Market conditions: Rents rising (+4.0%/yr); 637 active listings in the ZIP; 2 comparable units currently listed for rent nearby; solid renter incomes; 906 units permitted in Maui County in 2024 (289 in 5+ unit buildings).
• Maui County population projected at +22% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 11 sale attempts since 10y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Current owner paid $75k; list at $199k implies a 165% gain — meaningful room to come down on a strong offer.
• At $4,625/mo this rent would consume 55% of the median local household income ($101k/yr) (locally 835% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• It's been on market 455 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?
• What's the average days-on-market for RENTAL listings here right now (not sales)? A rising rental-DOM trend means longer vacancies and softer asking-rent achievability than the comps imply.