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Honolulu FSBO: Leasehold vs. Fee Simple and Hawaii Disclosure Requirements (2026)
Published January 15, 2026
Leasehold Land — Hawaii's Unique Disclosure
Honolulu has significant leasehold inventory, particularly in condos (Ala Moana, Waikiki, Nuuanu). In leasehold, you own the unit but lease the land from a ground lessor (often the Bishop Estate or other major landowners). Key disclosures:
Lease expiration date — leases typically run 55–65 years from original execution; remaining term dramatically affects value
Annual lease rent — current ground rent and any scheduled step-ups
Renegotiation provisions — when and how rent can be renegotiated (often at market rate, which can increase dramatically)
Fee purchase option — can the lessee purchase the fee interest? At what price?
Leasehold properties can be 30–50% cheaper than fee simple — but financing is harder (many lenders won't lend on leases with under 30 years remaining), and buyers face lease renegotiation risk. Disclose everything.
Hawaii Seller's Real Property Disclosure Statement
Hawaii's SRPDS covers:
Structural/mechanical: same as other states
Water: source, quality, catchment systems (common on neighbor islands)
Legal: HOA/AOAO, easements, encroachments
Environmental: lead paint, asbestos, underground tanks
Natural hazards: Lava Flow Hazard Zone, Tsunami Inundation Zone, flood zone, coastal setback
FIRPTA for Foreign Sellers
If you are a non-US person (foreign national or foreign entity), FIRPTA requires the buyer to withhold 15% of the gross sales price at closing and remit to the IRS. Consult a tax professional well before closing if this applies to you.
Download the HI SRPDS at byownerhub.com/honolulu#disclosures.
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