Canadian Buyers Guide to Hawaii Real Estate (2027)

Yes, Canadians can buy property in Hawaii. There’s no citizenship or residency requirement, no foreign buyer ban, and no special permit. You can own a condo, a house, or land the same way an American can.

What’s different is everything around the purchase: how you pay for it, what you owe when you rent it out, how long you can stay, what gets withheld when you sell, and what happens to it when you die. Most of the expensive mistakes Canadians make in Hawaii happen in those five places, not at the closing table.

This guide walks through each one with the rates and rules that apply going into 2027. It’s written for Canadians buying a vacation home, a snowbird condo, or a rental, not for people moving to Hawaii permanently.

The short version

Buying

Paying for it

Most Canadian buyers end up doing one of three things:

• Pay cash. The simplest by far, and the most common for condos.
• Borrow against your Canadian home. A HELOC on Canadian property gets you a Canadian rate and lets you show up in Hawaii as a cash buyer. If the Hawaii place earns rent, some of that interest may be deductible. Ask your accountant.
• Get a US mortgage. Some Canadian banks have US divisions with cross-border programs, and some US lenders offer foreign-national loans. Expect a bigger down payment and more paperwork than a US buyer, and know that many lenders won’t count Canadian income the same way.

Whichever route you take, open a US bank account early. You’ll want it for property taxes, HOA dues, utilities, and rent deposits.

The exchange rate is part of the price

You’re buying in US dollars. A few cents’ move in the loonie can shift a $900,000 purchase by tens of thousands of Canadian dollars between offer and closing. Some buyers lock in a rate with a currency exchange service once they’re in contract instead of converting at their bank on closing day. Your HOA dues, insurance, and property tax will also be in US dollars every year after that.

Get an ITIN before you need one

An ITIN is the US tax ID number for people without a Social Security number. You’ll need one to file a US return on rental income and to get back any excess FIRPTA withholding when you sell. Apply with IRS Form W-7. It takes time, so don’t leave it until tax season.

Hawaii-specific things to check before you make an offer

• Fee simple or leasehold. Some Hawaii condos sit on leased land. A leasehold unit can look cheap and lose value as the lease runs down. Know which one you’re buying.
• Can you actually rent it the way you plan to? Short-term rental rules vary sharply by island. On Oahu, stays under 30 days are largely limited to resort-zoned areas and permitted units. On Maui, about 7,000 apartment-zoned condos are being phased out of vacation rental use by 2029 or 2031 under Bill 9. Check the zoning before you fall in love with a unit.
• Condo finances. Ask for the reserve study, recent board minutes, and any pending special assessments. Insurance costs for Hawaii condo associations have risen sharply, and that shows up in dues.
• Hazard zones. On the Big Island, check the lava hazard zone. Statewide, check flood zones and the shoreline setback for oceanfront property.

Closing costs

Buyers typically pay their share of escrow fees, title insurance, recording fees, and loan costs. In Hawaii the seller usually pays the state conveyance tax, though the legislature has been debating changes to those rates, so confirm the current schedule with escrow.

Owning

Property tax

Hawaii’s property taxes look low next to most of Canada, but that headline rate is the owner-occupant rate. As a non-resident you won’t qualify for the homeowner exemption, and each county taxes second homes, vacation rentals, and investment property in higher classes. The gap can be large. Look up the actual class and rate for the specific property in its county before you run your numbers.

If you rent it out to visitors

Renting to guests for under 180 days makes you a transient accommodations operator, and Hawaii expects you to act like one:

• Register with the Hawaii Department of Taxation for a General Excise Tax (GET) license and a Transient Accommodations Tax (TAT) license, and show those license numbers in your listings.
• Collect and pay the taxes. The state TAT rose to 11% on January 1, 2026, under the new “Green Fee” law. Counties can add up to 3% more, and GET runs 4% to 4.5% depending on the island. Altogether that’s close to 19% of the nightly rate.
• Have a local contact. Owners who live off-island need a local contact person on the same island who can handle problems with the property.
• Follow county rules. Zoning and permit requirements decide whether you can rent nightly at all. This is where most rental plans go wrong.

Most Canadian owners hire a local property manager, which takes care of the contact requirement and most of the tax filings.

Filing taxes in both countries

In the US: By default, a property manager must withhold 30% of your gross rent for the IRS. Almost no one should accept that. Give your manager Form W-8ECI to elect to be taxed on net rental income instead, then file a US non-resident return (Form 1040-NR) each year. You’ll also file a Hawaii non-resident return (Form N-15). Deductions like mortgage interest, property tax, HOA dues, management fees, and depreciation often shrink the taxable amount a lot.

In Canada: You report the same rental income on your Canadian return, converted to Canadian dollars, and claim a foreign tax credit for the US and Hawaii tax you paid. If the property is held to earn income and cost more than CAD $100,000, you also file Form T1135 each year. A property used mainly for personal use is generally exempt from T1135, but the line can blur if you rent it part of the year. Penalties for missing T1135 are steep.

This is the one area where a cross-border accountant pays for themselves in the first year.

Staying

Owning a home in Hawaii doesn’t give you any right to live there. You’re still a visitor, and a few separate rules decide how long you can stay.

The immigration clock: about 182 days

Canadians can generally visit the US for up to six months at a time without a visa. Owning property doesn’t extend that. Border officers can and do ask about long or frequent stays, so keep proof of your ties to Canada handy.

The tax clock: the substantial presence test

This one catches people who never come close to six months in a single year. The IRS counts all your days this year, plus a third of last year’s days, plus a sixth of the year before. If that total hits 183, the IRS can treat you as a US tax resident.

In practice, spending about four months a year in Hawaii, year after year, gets you there. If it does, file Form 8840 (the Closer Connection Exception Statement) each year to show your real home is in Canada. It’s a short form, and skipping it can create a US tax mess on your worldwide income.

The registration rule for stays of 30 days or more

Since April 2025, visitors staying 30 days or longer have been required to be registered with US immigration. For most Hawaii trips this is already handled: people arriving by air are normally issued an electronic I-94 record, which counts as registration. It’s worth checking that yours exists on the CBP I-94 website before a long stay. Canadians who drive into the US and stay 30-plus days without an I-94 are the main group that needs to register separately.

Don’t forget the Canadian side

Provincial health plans generally require you to spend a minimum amount of the year in your province, and the rules differ by province. Long Hawaii stays can also affect your travel medical insurance. Check both before you plan a full winter away.

Selling

When a Canadian sells Hawaii property, two withholdings come off the top at closing. They’re calculated on the sale price, not your profit, which is why they surprise people.

• FIRPTA (federal): 15% of the gross sale price. If the buyer will live in the home, it drops to 10% for prices between US$300,000 and US$1 million, and to zero at US$300,000 or below.
• HARPTA (Hawaii): 7.25% of the gross sale price.

Neither is the actual tax. They’re prepayments. You file returns afterward and get back whatever was withheld beyond what you owe.

A worked example

Say you bought a Maui condo for US$700,000 and sell it in 2027 for US$1,000,000 to an investor. Selling costs run about US$60,000, leaving a gain of roughly US$240,000.

That $169,000 is yours, but you only get it back after filing a US return (Form 1040-NR) and a Hawaii return (Form N-15) for the year of the sale, and waiting for the refunds. If you rented the unit, depreciation you claimed adds to the tax, so your real numbers will differ. Treat this as an illustration, not a tax estimate.

How to avoid tying up that cash

Before closing, you can apply for withholding certificates that cut the withholding down to your estimated actual tax: IRS Form 8288-B for FIRPTA and Hawaii Form N-288B for HARPTA. Hawaii review has been taking several weeks, so escrow officers suggest applying 30 to 45 days ahead. On a sale like the one above, this is the difference between waiting months for $169,000 and having it at closing.

Then Canada taxes the gain too

As a Canadian resident you report the sale on your Canadian return, with half the gain included in income. Your gain is figured in Canadian dollars using the exchange rates when you bought and when you sold, so currency moves can make your Canadian gain bigger or smaller than your US gain. You’ll claim a foreign tax credit for the US and Hawaii tax paid, which usually keeps you from being taxed twice on the same gain.

Estate planning

This is the part almost every Canadian buyer skips, and the part with the biggest dollar amounts.

Federal estate tax: usually handled by the treaty

The US taxes the US assets of non-residents when they die. On its own terms, the exemption for a non-US citizen is just US$60,000, and if your US assets are worth more than that, your estate has to file a US estate tax return.

The Canada-US tax treaty fixes most of this. It gives Canadian residents a share of the full US exemption, prorated by how much of your worldwide estate sits in the US. The full exemption was raised to US$15 million for 2026 and is indexed to inflation after that. The practical result: if your worldwide estate is under roughly US$15 million, the treaty generally eliminates federal estate tax. A marital credit can add more relief when property passes to a spouse.

Two catches. Your estate still has to file to claim the treaty benefit. And if your worldwide estate is above the threshold, real tax can be owed, starting at rates well above anything Canadians are used to.

Hawaii estate tax: the one people miss

Hawaii has its own estate tax, separate from the federal one, and the federal treaty doesn’t set Hawaii’s rules. On Hawaii’s estate tax return, the basic exclusion for a non-resident who isn’t a US citizen is listed as US$60,000, not the multimillion-dollar amount US residents get. That means a Canadian’s Hawaii condo can trigger Hawaii estate tax even when the treaty wipes out the federal bill. Have an estate lawyer confirm how this applies to your situation before you buy.

What happens in Canada

Canada doesn’t have an estate tax, but it treats you as having sold everything at fair market value when you die. Any gain on the Hawaii property is taxed on your final Canadian return. The treaty provides some relief for US estate tax against that Canadian tax, but the interaction is complicated.

Ownership structures to ask about

How you take title is very hard to change later, so decide before closing. Common options Canadians discuss with cross-border advisors:

• Owning personally, alone or jointly with a spouse
• A cross-border trust
• A partnership or other structure
• A non-recourse mortgage, which can reduce the US value of the estate

Each has trade-offs for income tax, estate tax, and probate. There’s no one right answer, and this is not a do-it-yourself decision.

FAQ

Can a Canadian get a mortgage in Hawaii? Yes, through some Canadian banks’ US divisions and US lenders with foreign-national programs. Expect a larger down payment and stricter documentation than a US buyer. Many Canadians use a HELOC on their Canadian home instead.

Do I need a visa to buy? No. You can buy without a visa. Owning property doesn’t change how long you can stay.

How long can I stay at my Hawaii place each year? Generally up to about six months as a visitor. Watch the IRS substantial presence test too: about four months a year, every year, can make you a US tax resident unless you file Form 8840.

Do I have to pay US tax if I never rent it out? Not on income, since there isn’t any. You’ll still pay Hawaii property tax every year, and FIRPTA and HARPTA apply when you sell.

Can I rent my Hawaii condo to vacationers? Only if the zoning allows it. That depends heavily on the island and the building. If it does, you’ll need GET and TAT licenses and a local contact, and you’ll owe close to 19% in taxes on each booking.

Will I be taxed twice when I sell? Generally no. You pay US and Hawaii tax first, then claim a foreign tax credit on your Canadian return. The big issue is cash flow: up to 22.25% of the sale price is withheld at closing unless you apply for withholding certificates ahead of time.

What happens to my Hawaii property when I die? The treaty usually eliminates federal estate tax for estates under about US$15 million worldwide. Hawaii’s own estate tax works differently for non-citizens and can still apply. Plan your ownership structure before you buy.

Thinking about buying in Hawaii from Canada?

We work with Canadian buyers across the islands and can connect you with lenders, escrow, and cross-border tax advisors who do this every day. Start your search here, or if you already own and are thinking about selling, start here.

Sources

• Hawaii Green Fee raises TAT to 11%, Hawaii Tribune-Herald
• Hawaii TAT and county surcharge, Hawaii Magazine
• HARPTA withholding and Form N-288B, How to Live in Hawaii
• HARPTA rate increase to 7.25%, Maui Now
• Hawaii Estate Tax Return instructions (Form M-6), Hawaii Department of Taxation
• US estate tax for Canadians, 2026, RBC Wealth Management
• The treaty’s prorated unified credit, Bilzin Sumberg
• Owning US real estate as a Canadian, TD Wealth
• US 30-day registration rule and NEXUS, Money.ca
• Hawaii conveyance tax restructuring debate, Hawaii Tribune-Herald

This guide reflects publicly available information as of October 2026. It’s general information, not legal, tax, or financial advice. Cross-border tax rules are complicated and change often; work with a Canada-US tax advisor and an estate lawyer before buying, renting, or selling.