Wondering how much cash you need to close on a home or how much you will net after you sell on Oʻahu? Hawaii closings include unique line items, and condos or leaseholds can add steps you might not see on the mainland. In this guide, you will learn who typically pays what in Honolulu County, realistic ranges to plan for, island-specific wrinkles, and how to get a precise estimate for your situation. Let’s dive in.
What closing costs include
Closing costs are the non‑purchase‑price fees needed to complete a sale. They cover lender charges, title and escrow services, recording fees, taxes, and prorations for items like property taxes and HOA dues. Allocation is partly custom and partly contract, so many items are negotiable.
For planning, buyers often pay roughly 2–5% of the purchase price in closing costs, excluding the down payment. Sellers typically cover broker commission plus seller-side fees, with total outlays often around 6–10% of the sale price. Local conditions, price point, and property type will change the totals.
Who pays what on Oʻahu
Common buyer costs
- Lender fees. Origination points may range from 0–1% of the loan amount, plus flat underwriting and processing fees. Your Loan Estimate will outline these.
- Appraisal. Often required by lenders. Typical range is about $500–$1,200 depending on complexity.
- Buyer’s portion of escrow/closing fees. Fees may be split or assigned by contract. Plan for about $300–$1,000 or more.
- Lender’s title insurance and endorsements. Usually required when you finance. Premiums scale with the loan amount.
- Recording fees for loan documents. Modest fixed state fees per document.
- Title search or doc prep fees. Small flat amounts when applicable.
- Prepaid items and reserves. Several months of property taxes and homeowner’s insurance, plus initial escrow deposits.
- Inspections and surveys. Home and pest inspections often run $300–$800 each. Surveys can be $500–$2,000 depending on scope.
- Condo application or move‑in fees. Many associations charge $100–$500, but amounts vary.
Common seller costs
- Real estate broker commissions. Customarily around 5–6% of the sale price on Oʻahu, but negotiable. This is often the largest seller expense.
- Owner’s title insurance policy. Frequently paid by the seller locally, though this is negotiable and contract-driven.
- Hawaii conveyance tax. A state tax based on transfer value. Who pays is contract-dependent, and the amount varies by price bracket. Review current rules with the Hawaii Department of Taxation.
- Mortgage payoff and related release fees. Any existing liens are paid off at closing.
- Prorated property taxes and HOA dues. You pay for the days you owned the property through closing.
- Seller-side escrow/closing fees and documentary charges. Often several hundred dollars depending on contract terms.
- HOA resale or estoppel package. Associations commonly charge $100–$400 or more to prepare disclosures.
Costs that are often split or negotiated
- Escrow/closing agent fees
- Recording fees
- Owner’s title insurance policy
- HOA transfer fees
- Inspection-related repairs or credits
Oʻahu factors that change costs
Condos are common
Expect an association resale packet or estoppel certificate, plus possible buyer questionnaires or board approvals. Associations often charge transfer, application, and move‑in fees. These add modest costs and can extend timelines.
Leasehold and ground leases
Leasehold properties are more common here than on the mainland. Closings can require landlord consent, estoppel letters, transfer fees, and careful review of lease terms like rent adjustments or expiration. Some lenders will not finance certain leasehold scenarios, which can change both costs and your path to closing.
Recording and land systems
Hawaii uses the State of Hawaii Bureau of Conveyances and the Land Court. Recording fees are modest, but document handling can differ from mainland counties, so experienced local escrow and title support is helpful.
Property tax proration
Honolulu County billing and proration practices should be confirmed with the City and County of Honolulu Real Property Assessment Division. Your escrow officer will calculate your prorations based on the closing date.
Nonresident and foreign seller withholding
If a seller is a foreign person, federal FIRPTA may require withholding. Hawaii may also require nonresident withholding. Escrow companies help follow the rules, but tax advice is key. Review the IRS overview of FIRPTA withholding and consult a qualified tax professional.
Market conditions affect who pays
In a seller’s market, buyers may take on more costs or limit requests. In a buyer’s market, sellers may offer credits. Practices also follow local contract norms that evolve over time; the Hawaii Association of Realtors publishes the standard forms used in many Oʻahu transactions.
Real‑world examples (illustrative)
Below are simple, hypothetical examples to show scale. Your actual numbers will differ. Get a local estimate before you write a check.
Example: Buyer of an $800,000 Honolulu condo
- Lender fees at 1% of loan amount: about $8,000
- Appraisal: about $700
- Lender’s title policy and endorsements: about $3,200
- Escrow and recording: about $700
- Prepaid taxes, insurance, escrow deposits: about $3,500
- Home inspection: about $700
- Estimated buyer closing costs total: about $17,800, or roughly 2.2% of price
Example: Seller of the same $800,000 condo
- Commission at 5.5%: about $44,000
- Owner’s title policy: about $3,200
- Hawaii conveyance tax: amount depends on current brackets; verify with the Hawaii Department of Taxation
- Prorated taxes/HOA and resale package: about $1,200
- Estimated seller reductions exclude any mortgage payoff and depend on the final contract
How to get an accurate local estimate
Steps for buyers
- Ask your lender for a Loan Estimate after you apply. It will list expected lender fees, prepaid items, and title-related costs the lender expects you to pay.
- Request a buyer’s closing-cost worksheet from a local title or escrow company. Ask them to include Oʻahu-specific items like recording, title premiums, and prorations.
- Add inspections, appraisal, HOA move‑in fees, and, if relevant, leasehold-related charges.
Steps for sellers
- Ask your listing agent for a detailed net sheet that shows price, commission, typical seller fees, prorations, and estimated net proceeds.
- Order payoff demands from your lender early so escrow has accurate payoff numbers.
- Have escrow prepare an itemized estimate including owner’s title insurance premium, conveyance tax estimate, and HOA estoppel fees.
Documents to gather
- Executed purchase contract and agreed price
- Mortgage payoff statements (for sellers)
- HOA contact info and unit details for the resale package
- Lease documents if the property is leasehold
- Recent property tax bill and assessment
- Buyer pre‑approval and loan type for more precise lender fee estimates
Trusted local authorities
- Review current conveyance tax rules and any state withholding with the Hawaii Department of Taxation.
- Confirm recording procedures and fees with the State of Hawaii Bureau of Conveyances.
- Check property tax schedules and proration details with the City and County of Honolulu Real Property Assessment Division.
- For federal withholding on foreign sellers, see the IRS page on FIRPTA withholding.
Timeline tips for Oʻahu closings
Build in time for associations and lessors
Condo associations may need days to prepare resale packets or review applications. Leasehold transfers can require landlord consent. Start requests early to protect your timeline.
Clarify who pays what in writing
Since many items are negotiable, spell out owner’s title policy, escrow fee split, HOA transfer fees, and repairs in the contract. Ask your agent to align terms with local custom and your priorities.
Ready to run the numbers with a local team?
Whether you are budgeting as a buyer or calculating seller net proceeds, you deserve clear, Oʻahu‑specific numbers. Our team coordinates with lenders and escrow early, highlights condo and leasehold nuances, and prepares clean estimates so you can make confident decisions. Expect better. Schedule your free market consultation with Jaymes Song.
FAQs
Who pays Hawaii’s conveyance tax on Oʻahu sales?
- It is a state tax based on transfer value, and payment is contract-dependent; confirm current brackets and who pays with your escrow officer and the Hawaii Department of Taxation.
How much should an Oʻahu buyer budget for closing costs?
- Plan for roughly 2–5% of the purchase price, excluding your down payment, covering lender fees, title and escrow, appraisal, inspections, and prepaid taxes and insurance.
What does it typically cost to sell in Honolulu County?
- The largest item is commission, customarily around 5–6% but negotiable, plus seller-side closing fees, any conveyance tax, prorations, and mortgage payoff if applicable.
Who usually pays for the owner’s title policy in Hawaii?
- Local custom often has the seller pay the owner’s policy, but it is negotiable; your purchase contract controls, so confirm with your agent and escrow company.
What extra closing costs come with Oʻahu condos?
- Expect an HOA resale or estoppel packet, transfer and application fees, possible move‑in fees, and added time for association processing.
How do leasehold properties change closing costs and timing?
- Leasehold deals may require landlord consent, estoppel letters, transfer fees, and lender-specific requirements; they can add cost and time compared with fee-simple sales.
Are there tax withholdings at closing for nonresident or foreign sellers?
- FIRPTA and Hawaii state rules may require withholding; escrow will help follow procedures, and you should consult a tax professional early for guidance.
