Buying on the Kohala Coast: Two Questions to Answer Before You Offer

Leasehold vs. Fee Simple: Confirm Which One You Are Actually Buying

Not every property for sale in Hawaii conveys the land itself. In a leasehold purchase, you own the structure -- the condo unit, the house, the improvements -- but not the land underneath it; the land remains owned by a separate landowner under a long-term ground lease with its own remaining term, its own rent-renegotiation schedule, and its own expiration date. Fee simple, by contrast, means you own the land and everything on it outright, with no underlying lease and no expiration date. Fee simple is the most common ownership structure in Hawaii today, including on the Big Island and specifically in Kona and Kohala Coast real estate, per multiple Big-Island-specialist brokerage sources -- but those same sources are consistent that leasehold still exists in certain buildings, neighborhoods, and legacy land arrangements across the islands, including the Big Island.

This research did not identify a specific named Kohala Coast building or community confirmed to carry leasehold units, the way this site's Kauai coverage can point to a specific example. That's a genuine gap, not evidence that leasehold doesn't exist on this corridor -- given how much of this coast's land history runs through large legacy landholders (Parker Ranch's 1968 sale of Waikoloa's lava lands, the various ownership transitions behind Mauna Lani and Mauna Kea Beach Hotel's original site), a specific parcel's ownership structure should never be assumed from the resort's general reputation. Confirm in writing, for the specific unit, whether it is fee simple or leasehold before you get financially or emotionally attached to it.

If a Property Is Leasehold: What to Get in Writing Before You Offer

A leasehold listing is not automatically a bad deal -- leasehold prices typically run lower than a comparable fee-simple property, because you're buying a depreciating, time-limited interest rather than permanent land ownership, and some buyers accept that trade-off deliberately, particularly for a resort condo they don't intend to hold for generations. But it demands more careful due diligence than a standard fee-simple purchase. Before making an offer on any leasehold property here, get clear, written answers to: how many years remain on the ground lease; whether and how the lease rent resets or renegotiates during the remaining term; whether the landowner has any stated willingness to sell the fee interest, extend, or renew the lease, and on what terms; what happens to the improvements at lease expiration if no renewal or fee purchase occurs; and how mortgage lenders have treated financing in this specific building or on this specific lease term -- some lenders won't originate a conventional mortgage on a leasehold with too few years remaining, which can also affect resale value down the line. None of that substitutes for having a Hawaii-licensed real estate attorney read the actual ground lease before you sign a purchase contract.

Hawaii County's STVR Zoning: Confirm Before You Assume Rental Income

If any part of your plan for a Kohala Coast property involves short-term vacation rental income, there's a second, entirely separate question to answer before you offer: is this specific unit inside a zoning district where Hawaii County actually permits short-term vacation rental (STVR) use? Hawaii County regulates STVRs under Bill 108, adopted by the County Council in November 2018 as Ordinance 2018-114, which defines the zoning districts where the use is allowed and creates a Nonconforming Use Certificate pathway for existing STVRs that operated outside a permitted district before the ordinance. Under the zoning code, per multiple STVR-compliance guides, short-term rentals are generally permitted in Resort-Hotel (V) zoning and in areas designated Resort or Resort Node under the county's General Plan -- and Kona, the Kohala Coast, and Waikoloa Beach Resort are specifically described in that guidance as areas where a rental is likely to sit within a permitted zone.

"Likely" is not the same as confirmed for a specific unit, and this page will not treat it that way. Parcel-level zoning within even a resort-branded community can vary, and a specific building's or unit's actual zoning designation and STVR eligibility should be confirmed directly against Hawaii County's own zoning map and Planning Department guidance -- not assumed from the resort's marketing or general area reputation -- before you count on rental income as part of your purchase thesis.

A New 2025 Registration Requirement, With a July 1, 2026 Deadline

Layered on top of the underlying zoning question, Hawaii County passed Bill 47 (Ordinance 25-50) in 2025, adding a new countywide registration requirement for all TVR owners -- both hosted bed-and-breakfast operations and unhosted short-term vacation rentals. As of this research, the county's registration portal was reported not yet live, with a reported registration deadline of July 1, 2026, and reported fees of $250 initial plus $100 annual renewal for a hosted B&B, and $500 initial plus $250 annual renewal for an unhosted STVR. This is a real, dated, recently enacted requirement layered on top of the underlying 2018 zoning framework, not a replacement for it -- a unit still needs to sit in a permitted zone (or hold a valid Nonconforming Use Certificate) and separately register under this newer registration requirement. Confirm the current status of the registration portal and deadline directly with Hawaii County's Planning Department before assuming either the deadline or the fee structure described here is still current by the time you're reading this.

Standard Purchase Mechanics: Title, Escrow, and the Usual Contingencies

Beyond the two Hawaii-specific questions above, a Kohala Coast purchase otherwise follows the general mechanics common to Hawaii real estate transactions: an accepted purchase offer, a title search to confirm clear ownership and identify any recorded liens, easements, or encumbrances, an escrow arrangement to hold funds and documents while sale conditions are satisfied, and a closing where title transfers and the transaction records. As with any purchase, expect and negotiate for standard contingencies -- financing, inspection, and clear title among them -- appropriate to the specific property. This page does not state specific Hawaii County closing timelines, typical escrow-period lengths, or closing-cost percentages, because no such figures were confirmed strongly enough during research to print as settled fact for this market; ask your own title company, escrow agent, and real estate attorney for current timelines and costs specific to your transaction.

Who You Want on Your Side

Given how much of the above turns on Hawaii-specific and Hawaii-County-specific detail rather than generic mainland real estate knowledge, retain a Hawaii-licensed real estate attorney for this transaction specifically -- one who can read an actual ground lease and confirm a parcel's zoning status against Hawaii County's own ordinance text, not a general-practice attorney working outside their usual jurisdiction. Just as important: work with a real estate agent genuinely experienced on this specific corridor, who deals routinely with the leasehold-versus-fee-simple question and Hawaii County's STVR zoning and registration framework across the specific resort communities you're considering, rather than an agent whose primary experience is elsewhere on the island or on the mainland.

Confirm Directly Before Finalizing a Purchase

Nothing on this page is legal, tax, or financial advice. Before finalizing any Kohala Coast purchase: confirm in writing whether the specific property is leasehold or fee simple, and if leasehold, have a Hawaii-licensed real estate attorney read the actual ground lease -- remaining term, rent-reset terms, and renewal or fee-purchase options -- before you sign a contract; confirm the specific parcel's zoning status against Hawaii County's Bill 108 framework and its General Plan Resort designations, including whether it relies on a Nonconforming Use Certificate, and separately confirm the current status of the Bill 47 TVR registration requirement, before counting on short-term-rental income; and have your title company, escrow agent, and real estate attorney confirm current title, escrow, and closing procedures and costs specific to your transaction.