Known for its breathtaking landscapes and tropical climate, Hawaii is a dream destination for many. However, the high cost of living and housing affordability are significant challenges for residents. The U.S. Department of Housing and Urban Development (HUD) housing loans have become a lifeline for many Hawaiians, providing them with an opportunity to own a home in this paradise. These loans offer low-interest rates, flexible payment terms, and are accessible to individuals with varying income levels.

State Housing Market Overview

The Hawaiian housing market is one of the most expensive in the United States. The median home price is significantly higher than the national average, making homeownership a challenge for many residents. However, recent developments in affordable housing projects, backed by HUD and state housing authorities, are making strides in addressing this issue. These projects aim to increase the availability of affordable homes and provide financial assistance to potential homeowners.

Demographic trends also play a significant role in Hawaii's housing demand. The state's population is aging faster than the rest of the country, leading to an increased demand for senior-friendly housing options. Additionally, the state's tourism industry attracts a large number of temporary residents, further driving up housing demand and prices.

Economic Landscape and Demographic Trends

Hawaii's economy is heavily dependent on tourism, which directly impacts the housing market. The high influx of tourists leads to increased demand for rental properties, driving up housing prices. However, other sectors like healthcare and education also contribute significantly to the state's economy. The presence of several major universities and healthcare facilities creates a steady demand for housing from students and healthcare professionals.

Demographically, Hawaii is unique. It has a higher proportion of multiracial and Asian residents compared to the rest of the U.S., which contributes to its rich cultural diversity. This diversity is reflected in the housing market, with a wide range of housing styles and communities available. Despite the high cost of living, the allure of Hawaii's natural beauty and unique culture continues to attract people from all walks of life, sustaining a robust demand for housing.

Today's Interest Rates in Hawaii

Find today's rates in the table below.

Please note that these are only benchmark index rates — each loan product will have a rate that varies depending on the property, the location, the borrower's financial strength and experience, and several other factors.

Our Experts

When it comes to getting a HUD loan for your multifamily property, there are several amazing options. The names of the loans themselves are not particularly descriptive, however — more alphabet soup than proper name — yet they have major differences in purpose, eligibility, and terms.

Our team connects you with lenders across the U.S. to find the best financing terms for your property, even if that ends up being outside the world of HUD financing. It doesn't matter if you're buying or building, renovating or expanding, shopping your loan to multiple lenders puts you in a strong position to pick the financing terms that meet your needs.

Our experienced team of capital markets advisors will source the very best terms from our unparalleled network of lenders to ensure your property gets the best financing terms available. We offer this service completely free of charge.

Looking for more information about Hawaii? Read on below. Otherwise, click the button below, and we'll get right back to you with your free multifamily loan quote.

Current HUD Multifamily Loans in Hawaii

There are a wide range of HUD financing options for multifamily properties in Hawaii. Keep reading to learn which one could be the most suitable for your property.

HUD 223(f) Loans

A HUD 223(f) loan is an extremely versatile financing option that can be used for the acquisition or refinance of a multifamily property with more than five units. With long, fully amortizing terms, fixed interest rates and high LTVs, these loans can be the ideal financing vehicle to acquire a multifamily property.

HUD 221(d)(4) Loans

The HUD 221(d)(4) loan is the highest-leverage, lowest-cost construction loan available for a multifamily development. Offering terms of up to 43 years at a fixed interest rate, this financing is extremely popular with developers for good reason. During construction, the loan is interest-only (for up to three years), and upon completion the note has a fully amortizing, 40-year term.

HUD 223(a)(7) Loans

Fast isn't what most people might think of when they think of getting a HUD multifamily loan. However, a HUD 223(a)(7) loan offers both speed and simplicity, with fewer reports and documentation needed. At the same time, this program offers loans with lengthy, fully amortizing terms, and low, fixed rates in a non-recourse package.

Note that while a HUD 223(a)(7) loan can be a wonderful option, it is only available for properties with existing HUD multifamily debt.

HUD 241(a) Loans

If you need supplemental financing for your apartment building in Hawaii, a HUD 241(a) loan could be a great option. These loans are non-recourse and offer financing at a loan-to-cost ratio of 90% for for-profit entities and 95% for nonprofits. You need an existing HUD loan on your apartment building or healthcare property to qualify.

Interest rates are fixed, and the loan's term length typically will match the term of the senior HUD loan on the property, though in many cases this term can be extended up to 40 years.

HUD 232/223(f) Loans

HUD's healthcare property loan, the 232/223(f) loan, is similar to the previously mentioned HUD 223(f) financing option. Useful for purchasing or refinancing healthcare properties (including skilled nursing and assisted living facilities), the loan does have some restrictions in terms of commercial space. However, the benefits of a 35-year, fully amortizing term at a fixed rate is unparalleled in the healthcare sector.

Think a HUD multifamily loan could be right for your property in Hawaii? Add your details to the form below, and we’ll match you with the best lender — and loan — for your investment strategy.

Multifamily Property Insurance in Hawaii

This part isn't about loans, but it's just as important to your investment's success: insurance.

Multifamily insurance premiums have shot through the roof over the past few years, as I'm sure you know. Whether you own (or plan to own) a market-rate apartment building or an affordable housing property, this will have a huge impact on your profitability — and, worst case, ability to operate at all.

Janover Insurance Group is dedicated to finding the best insurance solutions for your multifamily property in Hawaii, regardless of if it's affordable housing or if you're using a HUD loan. Click to get a free insurance quote for your property — no obligation whatsoever.

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