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HAWAII INTERNATIONAL REAL ESTATE, LLC

Phone: (808) 778-3716 • Fax: (808) 859-5414 • E-mail: Info@HawaiiRealEstatePortal.com • 1888 Kalakaua Avenue, C 312, Honolulu, HI 96815

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Hawaii International Real Estate. Foreign Investments in Hawaii Real Estate

Today, we are living in the global marketplace. The international transactions in the production and consumption of goods and services are ever growing. In 2007, the U.S. exported $ 1,163 billion and imported $1,954 billion. Both expanded over 11% during the past several years, which is far beyond of domestic transactions growth. In calendar year 2007, the U.S. exported $1.15 Trillion of goods and $0.5 Trillion of services; and the U.S. imported $1.97 Trillion of goods and $0.378 Trillion of services. This site  provides information on current trends and historical perspectives of foreign investments in Hawaii real estate.

With the expansion of international trade, the flow of people across borders has also increased rapidly, and, therefore, the demand for real estate in both residential and commercial sectors in conjunction with international real estate transactions has been on the rise. National Association of Realtors® has recently issued Hawaii reports on international transactions. Here we present recent economic and demographic data related to Hawaii International Real Estate and Business Activity taken from this report. Below you will find information about Hawaii specific demographic and economic data on a variety of topics like Population demographics in Hawaii: U.S. born, foreign born, naturalized, and non-U.S. citizen residents and

  • Main languages spoken in households in Hawaii

  • Immigration and naturalization trends for Hawaii

  • Non-immigrant visitors to Hawaii

  • Foreign direct investment in the U.S. and Hawaii

  • Value of Hawaii exports by type of product

  • Hawaii exports to specific trading partner counties

With the expansion of international trade, the flow of people across borders has also increased fast, and therefore, the demand for Hawaii real estate in both Hawaii residential real estate and Hawaii commercial real estate has been on the rise. Hawaii International Real Estate is not just a niche industry, but is integrated into all sectors of the residential and commercial real estate business and is a significant means for growing business and economy in Hawaii.

Hawaii International Real Estate, LLC seeks to render the global market accessible to and profitable for foreign investments, and offers a wide variety of services to help clients succeed in the international arena and within Hawaii local market. The purpose of this page is to present recent economic data related to international business activity directly associated with Hawaii International Real Estate and explore the possible opportunities in Hawaii real estate business in today’s global economy with foreign nationals, foreign companies and foreign referral counterparts.

Non-immigrant visitors to Hawaii

In 2007, total of 1,596,336 non-immigrant aliens came into Hawaii. Those in some selected categories are:

  • 1,500,464 temporary visitors for pleasure

  • 66,275 temporary visitors for business

  • 2,449 treaty traders and investors

  • 9,078 foreign students and dependant families

  • 2,610 temporary foreign workers, trainees and dependant families

  • 406 NAFTA professional workers and dependant families

Obviously many of them needed rental housing, purchased second homes, or invested in Hawaii commercial real estate. A recent study of The 2008 National Association of REALTORS® Profile of international Home Buying Activity1 shows that about 3 percent of entire home sales involved foreign buyers in the nationwide. The percentage of foreign buyer’s participation varies according to state. For example, over 9 % of all home sales transactions involve international buyers in Florida which has been the most popular destination of home buyers from abroad. Although Hawaii may not witness such high volume of international real estate transactions as in Florida, there are still enough foreigners arriving in the state to make an impact on overall real estate transactions.

1 NAR conducted a survey of REALTORS® in 2008 to better understand the extent of non-U.S. resident homebuyers, why those buyers purchased U.S. homes, and what types of properties they bought and for what purpose. Of the REALTORS® who participated in the survey, 13% reported that they did at least one home sale transaction with international buyers.

Foreign Direct Investment Establishment in Hawaii

A U.S. affiliate is a U.S. business enterprise that is owned 10 percent or more, directly or indirectly, by a foreign person. As of 2002, there are total of 118,588 U.S. affiliates of foreign companies in the nationwide. This is increased by 12% compared to 5 years before. In Hawaii alone, there are 990 companies in this category. They contribute Hawaii real estate industry by purchasing or renting Hawaii commercial real estate properties for their business. In addition, the frequent flows of staff and their families from home countries creates housing demand.

Hawaiian Investors Looking for Homes Abroad

It is not only foreigners that will significantly impact international home buying. Many U.S. residents will require a home abroad. Exports of products to Japan and New Zealand from Hawaii were $ 156 million and $ 3 million, respectively, in the past year (2006). Third on the list of countries where Hawaii products are exported is Singapore. The increase in Hawaii exports may lead locally based companies to establish company representatives and sales personnel in those countries. Petroleum and Coal Products and Transportation Equipment were the top export industries in Hawaii. Those two industries combined account 49% of the entire exports from Hawaii.

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Immigration and Naturalization in Hawaii

Immigration to the United States soared in the past two decades, which likely will lead to many more home purchases in the coming decade.2 The U.S. population grew by roughly 20 million people since year 2000. The strong increase in immigration added 8 million people, and resulted nearly 40 percent of the rise in U.S. population since 2000.

In Hawaii, 4,521 newly admitted legal immigrants arrived in 2007. The largest group came from Philippines (4,109). Other top countries of origin include:

  • China, People's Republic (718)

  • Japan (523)

  • Korea (298)

  • Vietnam (181)

2 There are contentious issues relating to swelling illegal immigration and assimilation, and here we do not attempt to delve into this difficult topic.

In 2007, 4,521 immigrants to Hawaii became U.S. citizens. Natives of Philippines led with the highest number (2,061) of newly naturalized citizens in the state last year (2006). Other top countries represented include:

  • Korea (492)

  • China, People's Republic (370)

  • Japan (209)

  • Vietnam (207)

As of 2007 there are 124,741 (9.7% of the state population) of naturalized citizens and 96,707 non-citizens (7.5% of the state population) in Hawaii. Immigration boosts the Hawaii residential real estate market for the simple reason that people need a home in which to live. So it should not be surprising that dynamic housing markets of recent years have been in those regions with significant immigrant populations. The fast growing regions of Las Vegas, Phoenix, Washington D.C. and much of Florida have seen strong housing demand – and a significant run-up in home prices – due in no small part to the fact that these markets have strong immigrant populations.3

3 A study by the Philadelphia Federal Reserve Bank showed that home prices in immigration-heavy neighborhoods rise much more slowly than other neighborhoods in the local region. That is, the “there goes the neighborhood” reaction may be at work as established residents flee an area and newcomers move in. However, home prices in metro regions with a high concentration of immigrants in general rose at a significantly faster clip than those metro regions with little immigration. Larger number of people translates into more housing demand.

The homeownership rate of foreign-born households who came to the U.S. in the past five years is only 18 percent. The ownership rate then steadily rises over time.

Naturally, due to language, cultural and institutional adjustments, homeownership among recent immigrants lags behind that of native-born Americans and the population as a whole. However, obtaining U.S. citizenship quickly raises the odds of becoming a homeowner. In fact, among households who entered the country more than 30 years ago, the homeownership rate surpasses that of the national average, with 78% of foreign-born U.S. residents owning a home - far higher than the national homeownership rate of 69%.

Hawaii International Real Estate, LLC seizes the opportunity and help close the early-year homeownership gap through counseling and homebuyer education programs about Hawaii real estate for our foreign-born clients. We have already realized the potential business opportunities. Over the last few years, Hawaii International Real Estate, LLC has participated in a transaction involving an international element, and this trend will inevitably increase.

Population Demographics in Hawaii

Total Population U.S. Born Citizen

Foreign Born

(%) Naturalized Citizen

Non USA Citizen

Male 645,483 551,697 93,786 14.5 51,745

42,041

18 and Over 497,115 410,025 87,090 17.5 50,060

37,030

Under 18 148,368 141,672 6,696 4.5 1,685

5,011

Female 637,905 510,243 127,662 20.0 72,996

54,666

18 andOver 500,508 380,043 120,465 24.1 71,082

49,383

Under 18

137,397 130,200 7,197 5.2 1,914

5,283

Total

1,283,388 1,061,940 221,448 17.3 124,741

96,707

Source: Census Bureau, American Community Survey 2007

Foreign Born Population in Hawaii by Year of Entry

Total Population U.S. Born Citizen

Foreign Born

Naturalized Citizen

Non USA Citizen

2000 or later

55,255 7,024 48,231 5,789

42,442

1990 to 1999

65,441 6,423 59,018 27,387

31,631

Entered 1980 to 1989

50,978 4,968 46,010 33,482

12,528

Entered before 1980

83,522 15,333 68,189 58,083

10,106

Total

255,196 33,748 221,448 124,741

96,707

Source: Census Bureau, American Community Survey 2007

Main Languages Spoken in Households

Main Language

Total Household

Linguistically Isolated

Not Linguistically Isolated

English

298,241

Spanish  

15,310

1,642

13,668

Indo-European

10,481

489

9,992

Asian-Pacific

114,985

24,176

90,809

Other

668

0

668

Total

439,685

26,307

115,137

Source: Census Bureau, American Community Survey 2007

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Immigration and Naturalization Trend in Hawaii

Year

Admitted Immigrants

Naturalization

1998

5,458

4,480

1999

4,292

3,596

2000

6,047

4,358

2001

6,282

2,875

2002

5,478

2,881

2003

4,899

2,287

2004

6,405

2,050

2005

6,480

4,663

2006

7,499

5,276

2007

7,236

4,521

Source: Department of Homeland Security, Yearbook of Immigration Statistics: 2007

Hawaii International Real Estate

2007 Immigration to Hawaii by Country of Birth

Total: 7,236

Europe 266

Asia 6,227

Africa 65

North America 243

South America 140

Oceania 291

United Kingdom 52 Germany 46

Italy 16

Soviet Union, frm 16

Sweden 13

France 12

Bulgaria 10

Ukraine 9

Russia 8

Philippines 4,109

China 718

Japan 523

Korea 298

Vietnam 181

Thailand 104

Taiwan 76

Hong Kong 53

India 25

South Africa 14

Ethiopia 10

Kenya 8

Nigeria 7

Egypt 5

Ghana 4

Morocco 3

Zambia 3

Canada 103

Mexico 71

Guatemala 34

El Salvador 14

Costa Rica 3

Dominican Republic 3 Trinidad -Tobago 3

Brazil 56

Argentina 21

Colombia 17

Peru 16

Venezuela 9

Chile 5

Ecuador 5

Bolivia 3

Uruguay 3

Tonga 104

Samoa 81

Australia 33

New Zealand 29

Fiji 14

French Polynesia 14 Marshall Islands 4

Source: Department of Homeland Security, Yearbook of Immigration Statistics: 2007

2007 Immigration to Hawaii by Origination Region

Africa 1%, North America 3%, South America 2%, Oceania 4%, Europe 4%, Asia 86%

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2007 Naturalization in Hawaii by Country of Birth

Total: 4,521

Europe 232

Asia 3,683

Africa 49

North America 278

South America 96

Oceania 183

United Kingdom 44

Germany 35

Russia 19

France 18

Bulgaria 10

Italy 10

Netherlands 9

Serbia-Montenegro 8

Sweden 8

Philippines 2,061

Korea 492

China 370

Japan 209

Vietnam 207

Hong Kong 78

Thailand 54

Taiwan 50

Laos 36

South Africa 8

Egypt 5

Kenya 5

Nigeria 5

Ghana 4

Liberia 4

Tunisia 4

Mexico 107

Canada 80

Jamaica 14

El Salvador 10

Nicaragua 9

Panama 9

Guatemala 8

Trinidad-Tobago 8

Dominican Republic 6

Brazil 43

Peru 21

Ecuador 13

Guyana 7

Argentina 4

Bolivia 3

Tonga 41

Samoa 40

American Samo 36

New Zealand 18

Australia 16

Palau 8

Fiji 7

French Polynesia 7 Micronesia, Fed 5

Source: Department of Homeland Security, Yearbook of Immigration Statistics: 2007

2007 Naturalization in Hawaii by Origination Region

Africa 1%, North America 3%, South America 2%, Oceania 4%, Europe 4%, Asia 86%

Hawaii  International Real Estate

Nonimmigrant Visitors to Hawaii

2005

2006

2007

Total

Foreign government officials and families

Temporary visitors: for business

Temporary visitors: for pleasure

Transit aliens

Treaty traders and investors

Students and dependant family

Representatives to international organizations and families

Temporary workers and trainees, dependent family

Representatives of foreign information media and families

Students and exchange visitors, and dependant family

Fiances/spouses of U.S. citizens and their children

Intracompany transferees and dependant family

Vocational students and dependant family

NATO officials and families

NAFTA professional workers and dependant family

Fiances/spouses of permanent residents and their children

All other classes

1,787,138

3,497

52,418

1,697,285

3,978

2,267

8,740

98

2,215

589

1,738

690

647

436

 

396

155

11,803

1,669,783

3,925

81,616

1,551,966

3,360

2,347

9,349

92

2,499

563

1,985

662

742

558

53

393

61

9,602

1,596,336

3,761

66,275

1,500,464

4,047

2,449

9,078

123

2,610

668

2,323

696

768

590

30

406

19

2,029

Source: Department of Homeland Security, Yearbook of Immigration Statistics: 2007

Hawaii International Real Estate

Foreign Direct Investment Established in Hawaii

Industry

U.S.

Hawaii

All industries

11,8588

990

Mining

1,107

0

Utilities

815

5

Construction

1,082

19

Manufacturing

10,322

15

Wholesale trade

15,798

84

Retail trade

30,540

302

Transportation and warehousing

5,468

20

Information

5,046

33

Finance: Depository credit intermediation

3,263

63

Finance: Insurance

3,709

32

Real estate and rental and leasing

1,890

47

Professional and technical services

4,275

22

Accommodation and food services

15,255

181

Other

16,824

145

Source: Department of Commerce, Foreign Direct Investment in the United States Establishment Data for 2002

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Hawaii Exports by Product

(Unit: $1,000)

Product

2004

(%)*

2005 (%)

2006

(%)

2007

(%)

% Change, ** 2006-2007

Hawaii Exports Total

404,774

0.0%

1,028,167 0.1%

705,744

0.1%

560,426

0.0%

0.0%

Petroleum & Coal Products

109,335

27.0%

99,109 9.6%

152,920

21.7%

186,561

33.3%

33.3%

Transportation Equipment

57,896

14.3%

682,584 66.4%

291,695

41.3%

88,464

15.8%

15.8%

Waste & Scrap

42,938

10.6%

53,544 5.2%

56,014

7.9%

74,442

13.3%

13.3%

Beverage & Tobacco Products

25,513

6.3%

33,700 3.3%

37,723

5.3%

42,324

7.6%

7.6%

Computers & Electronic Prod.

38,570

9.5%

29,228 2.8%

14,710

2.1%

30,200

5.4%

5.4%

Processed Foods

30,263

7.5%

25,553 2.5%

31,447

4.5%

29,014

5.2%

5.2%

Crop Production

14,768

3.6%

15,116 1.5%

18,362

2.6%

16,250

2.9%

2.9%

Misc. Manufactures

10,895

2.7%

8,198 0.8%

10,735

1.5%

13,049

2.3%

2.3%

Fabricated Metal Products

1,167

0.3%

953 0.1%

4,538

0.6%

10,746

1.9%

1.9%

Fishing, Hunting, & Trapping

8,623

2.1%

8,931 0.9%

12,508

1.8%

10,694

1.9%

1.9%

Machinery Manufactures

12,891

3.2%

2,632 0.3%

18,542

2.6%

9,941

1.8%

1.8%

Spec. Classification Provisions

17,294

4.3%

32,321 3.1%

19,073

2.7%

7,665

1.4%

1.4%

Elec. Eq., Appliances & Parts

1,909

0.5%

3,700 0.4%

4,632

0.7%

7,042

1.3%

1.3%

Chemical Manufactures

7,003

1.7%

8,406 0.8%

6,780

1.0%

6,829

1.2%

1.2%

Used Merchandise

3,639

0.9%

5,632 0.5%

6,017

0.9%

5,189

0.9%

0.9%

Leather & Related Products

1,903

0.5%

1,357 0.1%

1,867

0.3%

3,616

0.6%

0.6%

Apparel Manufactures

3,460

0.9%

3,510 0.3%

3,146

0.4%

3,337

0.6%

0.6%

Printing & Related Products

2,926

0.7%

3,771 0.4%

2,831

0.4%

3,195

0.6%

0.6%

Animal Production

5,358

1.3%

1,953 0.2%

2,299

0.3%

2,466

0.4%

0.4%

Paper Products

2,802

0.7%

3,733 0.4%

3,744

0.5%

2,324

0.4%

0.4%

Primary Metal Manufactures

240

0.1%

531 0.1%

2,129

0.3%

2,309

0.4%

0.4%

Fabric Mill Products

867

0.2%

985 0.1%

750

0.1%

1,353

0.2%

0.2%

Non-Metallic Mineral Mfgs.

704

0.2%

329 0.0%

201

0.0%

727

0.1%

0.1%

Plastic & Rubber Products

622

0.2%

622 0.1%

1,027

0.1%

686

0.1%

0.1%

Mining

229

0.1%

223 0.0%

533

0.1%

502

0.1%

0.1%

Source: Department of Commerce, State by State Exports: 2007

* % of State export total is the share of entire U.S. export, and others are shares of state export. ** (Z) means that % change is greater than 500%, and (-) means that the product is a new export.

Hawaii International Real Estate

Hawaii Exports by Trading Partner Countries

(Unit: $1,000)

Country

2004

(%)*

2005

(%)

2006

(%)

2007

(%)

% Change,** 2006-2007

World Total

404,774

0.0%

1,028,167

0.1%

705,744

0.1%

560,426

0.0%

0.0%

Japan

117,147

28.9%

138,844

13.5%

192,552

27.3%

156,476

27.9%

27.9%

New Zealand

23,378

5.8%

7,775

0.8%

870

0.1%

3,199

0.6%

0.6%

Singapore

48,043

11.9%

520,862

50.7%

232,250

32.9%

105,716

18.9%

18.9%

Australia

16,779

4.1%

2,658

0.3%

9,099

1.3%

38,323

6.8%

6.8%

South Korea

44,239

10.9%

53,598

5.2%

23,546

3.3%

51,072

9.1%

9.1%

Canada

23,675

5.8%

17,158

1.7%

16,106

2.3%

21,040

3.8%

3.8%

Taiwan

11,169

2.8%

1,371

0.1%

2,432

0.3%

5,268

0.9%

0.9%

Hong Kong

15,475

3.8%

5,720

0.6%

6,942

1.0%

18,793

3.4%

3.4%

China

33,941

8.4%

132,624

12.9%

33,224

4.7%

29,124

5.2%

5.2%

Malaysia

97

0.0%

7,931

0.8%

8,730

1.2%

15,738

2.8%

2.8%

Philippines

6,874

1.7%

9,760

0.9%

10,960

1.6%

11,505

2.1%

2.1%

Germany

7,385

1.8%

6,878

0.7%

6,195

0.9%

4,765

0.9%

0.9%

Thailand

14,645

3.6%

18,057

1.8%

15,242

2.2%

9,521

1.7%

1.7%

Mexico

1,152

0.3%

999

0.1%

3,600

0.5%

2,559

0.5%

0.5%

France

3,228

0.8%

2,439

0.2%

2,159

0.3%

2,432

0.4%

0.4%

Netherlands

2,115

0.5%

1,249

0.1%

3,761

0.5%

2,805

0.5%

0.5%

United Kingdom

9,028

2.2%

10,058

1.0%

19,447

2.8%

16,462

2.9%

2.9%

Italy

605

0.1%

459

0.0%

1,226

0.2%

1,715

0.3%

0.3%

Indonesia

888

0.2%

12,864

1.3%

23,158

3.3%

2,073

0.4%

0.4%

Sweden

750

0.2%

411

0.0%

1,370

0.2%

1,500

0.3%

0.3%

French Polynesia

597

0.1%

267

0.0%

228

0.0%

6,324

1.1%

1.1%

Viet Nam

352

0.1%

7,802

0.8%

1,049

0.1%

2,478

0.4%

0.4%

Costa Rica

34

0.0%

2,366

0.2%

3,044

0.4%

8,232

1.5%

1.5%

South Africa

30

0.0%

28

0.0%

1,023

0.1%

1,570

0.3%

0.3%

El Salvador

119

0.0%

0

0.0%

24,542

3.5%

28,947

5.2%

5.2%

Source: Department of Commerce, State by State Exports: 2007

* % of State export total is the share of entire U.S. export, and others are shares of tate export. ** (Z) means that % change is greater than 500%, and (-) means that this is a new partner.

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