Airbnb City Guide: The Best Places To Invest in Honolulu, Hawaii

Airbnb Rules and Regulations in Honolulu, Hawaii

As of 2024, short-term rentals in Honolulu, defined as rentals for less than 30 consecutive days, face strict regulations. STRs are only permitted in specific resort-zoned areas like Waikiki and Ko Olina and a few apartment-zoned districts. Ordinance 22-7, which aimed to limit STRs to a minimum of 90 days outside resort zones, was challenged in court, and a federal judge ruled in favor of allowing existing STR owners to continue operating with a 30-day minimum.

However, new STRs established after the ordinance passed are still subject to the 90-day rule. All STR operators must register their units, obtain a tax map key and transient accommodations tax license, and include these numbers in any advertisement. Violations can result in fines of up to $10,000 per day. Despite some restrictions easing, Honolulu continues to enforce strict STR regulations to protect housing availability for local residents.

Honolulu Airbnb Market Data:

• Average Revenue – $61.3K per year
• Average Daily Rate – $288.7 per night
• Average Occupancy Rate – 76%
• Average RevPAR – $215.1
• Average Home Prices – $787,369

1. Top Place to Invest in Honolulu, Hawaii - Downtown

Nestled between the iconic Waikiki and the bustling Honolulu Harbor, Downtown Honolulu is a vibrant urban center that seamlessly blends history, culture, and modern amenities. This dynamic neighborhood offers investors a unique opportunity to tap into the thriving tourism industry and the growing demand for short-term rentals in Hawaii's capital city.

Downtown Airbnb Market Data:

• Average Revenue – $54.6K per year
• Average Daily Rate – $228.5 per night
• Average Occupancy Rate – 81%
• Average RevPAR – $183.9

Convenience: 7/10

Downtown Honolulu boasts a wide array of convenience stores, supermarkets, and local businesses that cater to both residents and visitors. With its central location and well-connected public transportation system, getting around the city is a breeze. However, the area can experience heavy traffic during peak hours, which may be a slight inconvenience for some.

Tourist Attractions: 8/10

From the historic Iolani Palace to the iconic King Kamehameha Statue, Downtown Honolulu is home to some of the most significant landmarks in Hawaii. Visitors can immerse themselves in the rich history and culture of the islands by exploring the Hawaii State Art Museum, the Honolulu Museum of Art, and the vibrant Chinatown district. While not as touristy as Waikiki, Downtown Honolulu offers a more authentic Hawaiian experience.

Things to Do: 7/10

Downtown Honolulu offers a diverse range of activities for both locals and tourists. Foodies will delight in the eclectic dining scene, with options ranging from traditional Hawaiian cuisine to international flavors. The Arts District hosts regular events and exhibitions showcasing the works of local artists. For those seeking outdoor adventures, the nearby Ala Moana Beach Park provides a perfect spot for swimming, surfing, and picnicking.

Average Home Prices: 6/10

According to Zillow, the median home price in Downtown Honolulu was $386,000 in 2024, a 4.3% increase from the previous year. While this may seem relatively affordable compared to other major cities, it's important to note that the cost of living in Hawaii is generally higher than in the mainland United States. Additionally, the appreciation rate of 4.3% is slightly lower than the national average, which may impact long-term investment returns.

Proximity to Work-Related Travel: 8/10

Downtown Honolulu is the city's central business district, making it an ideal location for those who frequently travel for work. The area is home to numerous corporate offices, government buildings, and the Hawaii Convention Center, which hosts various events and conferences throughout the year. The Daniel K. Inouye International Airport is just a short drive away, providing easy access to domestic and international flights.

X-Factor: 9/10

What sets Downtown Honolulu apart is its unique blend of history, culture, and urban sophistication. The area has served as the backdrop for numerous TV shows and movies, including the iconic "Hawaii Five-O" series. Investors can capitalize on this Hollywood connection by offering themed short-term rentals that appeal to fans of the show. Additionally, the neighborhood's proximity to both Waikiki and the Honolulu Harbor allows visitors to experience the best of both worlds - the tourist hub's excitement and the local community's authentic charm.

2. Top Place to Invest in Honolulu, Hawaii - Diamond Head

Nestled at the foot of Oahu's iconic volcanic crater, the Diamond Head neighborhood offers a perfect blend of natural beauty, convenience, and investment potential. This prestigious residential area, prized for its proximity to world-famous beaches, top-notch amenities, and breathtaking views, is a prime location for establishing new short-term rentals for those seeking to capitalize on Honolulu's thriving tourism market.

Diamond Head Airbnb Market Data:

• Average Revenue – $61K per year
• Average Daily Rate – $281.8 per night
• Average Occupancy Rate – 83%
• Average RevPAR – $235.9

Convenience: 8/10

Diamond Head's central location provides easy access to Honolulu's major thoroughfares, making it a breeze to navigate the city. With Waikiki's bustling shopping and dining scene just minutes away, residents and visitors alike can enjoy the best of both worlds - a tranquil neighborhood setting with urban conveniences at their fingertips. However, traffic congestion during peak hours can be a slight drawback.

Tourist Attractions: 9/10

The neighborhood's crown jewel is undoubtedly the Diamond Head State Monument, a 300,000-year-old crater offering hiking trails and panoramic views of the Pacific Ocean and Honolulu skyline. Nearby attractions include the historic Diamond Head Lighthouse, the Honolulu Zoo, and the Waikiki Aquarium, ensuring visitors have plenty of options for exploration and entertainment.

Things to Do: 8/10

From sunbathing on the golden sands of Kaimana Beach to hiking the iconic Diamond Head trail, this neighborhood offers a wealth of outdoor activities. Foodies will delight in the area's diverse culinary scene, featuring local favorites like Diamond Head Market & Grill and upscale dining at the renowned Hau Tree Lanai. Local cultural events at the Kapiolani Community College Farmers' Market and the Honolulu Museum of Art add to the neighborhood's appeal.

Average Home Prices: 7/10

According to Zillow, the median home value in Diamond Head was $1,895,000 as of March 2024, representing a 3.8% appreciation over the past year. While this may seem steep compared to other areas of the country, it is in line with Honolulu's high-end real estate market. The neighborhood's desirable location and limited inventory contribute to its premium prices, making it a solid choice for investors seeking long-term appreciation potential.

Proximity to Work-Related Travel: 7/10

Diamond Head's proximity to downtown Honolulu and the Ala Moana district puts it within easy reach of major employment centers, hospitals, and the Hawaii Convention Center. The Daniel K. Inouye International Airport is just a 20-minute drive away, making it convenient for residents and visitors who frequently travel for work or leisure.

X-Factor: 9/10

What sets Diamond Head apart is its unparalleled combination of natural beauty, prestige, and access to world-class amenities. The neighborhood's stunning coastal setting, rich history, and cultural significance create an allure that is hard to resist. For Airbnb and short-term rental investors, the opportunity to offer guests a taste of luxury living in one of Honolulu's most sought-after neighborhoods is a significant draw.

3. Top Place to Invest in Honolulu, Hawaii - McCully-Moiliili

Situated between the bustling streets of Honolulu and the serene beauty of Manoa Valley, McCully-Moiliili is a vibrant, diverse neighborhood that offers a unique blend of urban convenience and local charm. This hidden gem is quickly becoming a hotspot for savvy Airbnb and short-term rental investors looking to tap into the area's growing popularity among visitors seeking an authentic Hawaiian experience.

McCully-Moiliili Airbnb Market Data:

• Average Revenue – $41.4K per year
• Average Daily Rate – $226.4 per night
• Average Occupancy Rate – 66%
• Average RevPAR – $146

Convenience: 9/10

McCully-Moiliili boasts an unbeatable location, with easy access to major highways, public transportation, and a wide array of amenities. The neighborhood is home to numerous grocery stores, pharmacies, and local businesses, making it a convenient choice for both residents and visitors. Its proximity to the University of Hawaii at Manoa also adds to its appeal, attracting a diverse mix of students, faculty, and young professionals.

Tourist Attractions: 6/10

While McCully-Moiliili may not have the same concentration of tourist attractions as some other areas of Honolulu, it still offers plenty of opportunities for exploration and discovery. The neighborhood is just a short drive from popular destinations like Waikiki Beach, Diamond Head State Monument, and the Honolulu Zoo. However, its main draw lies in its authentic local vibe and hidden gems, such as the Moiliili Neighborhood Park and the Willows Restaurant.

Things to Do: 7/10

McCully-Moiliili offers a diverse range of activities for residents and visitors alike. Foodies will delight in the neighborhood's eclectic dining scene, which features everything from traditional Hawaiian plate lunches to international cuisines. The area is also home to several parks and green spaces, including the Ala Wai Golf Course and the Kanewai Community Park, providing ample opportunities for outdoor recreation.

Average Home Prices: 8/10

According to Zillow, the median home value in McCully-Moiliili was $735,000 as of 2024, representing a 4.2% appreciation over the past year. While this may seem high compared to some mainland markets, it is relatively affordable by Honolulu standards. The neighborhood's mix of single-family homes, condominiums, and apartments offers a range of investment opportunities for Airbnb and short-term rental investors.

Proximity to Work-Related Travel: 8/10

McCully-Moiliili's central location puts it within easy reach of major employment centers, hospitals, and the Hawaii Convention Center. The neighborhood is just a short drive from downtown Honolulu and the Ala Moana district, making it a convenient choice for business travelers and remote workers. The Daniel K. Inouye International Airport is also easily accessible, with an average travel time of around 20 minutes.

X-Factor: 8/10

What sets McCully-Moiliili apart is its unique blend of local culture, diversity, and community spirit. The neighborhood is known for its tight-knit community and friendly residents, creating a welcoming atmosphere for visitors and newcomers alike. Its proximity to the University of Hawaii at Manoa also adds to its vibrant energy and intellectual appeal, making it an attractive destination for travelers seeking an authentic, off-the-beaten-path experience.

In conclusion, McCully-Moiliili presents a compelling investment opportunity for those looking to enter Honolulu's growing short-term rental market. With its unbeatable convenience, diverse attractions, and strong community spirit, this hidden gem is poised to become a top choice for savvy investors and discerning travelers alike.

4. Top Place to Invest in Honolulu, Hawaii - Waikiki

Waikiki, the iconic beachfront neighborhood in Honolulu, is a world-renowned tourist destination that attracts millions of visitors annually. With its pristine white sand beaches, luxurious resorts, and vibrant nightlife, Waikiki offers an unparalleled opportunity to establish a short-term rental and capitalize on the area's enduring popularity and strong tourism market.

Waikiki Airbnb Market Data:

• Average Revenue – $71K per year
• Average Daily Rate – $316.8 per night
• Average Occupancy Rate – 78%
• Average RevPAR – $235.5

Convenience: 9/10

Waikiki's compact layout and well-developed infrastructure make it incredibly convenient for both residents and visitors. The neighborhood is easily navigable on foot, with a wide array of shops, restaurants, and amenities within walking distance. Public transportation, including buses and the Waikiki Trolley, provides easy access to other parts of Honolulu, while the nearby Ala Wai Canal offers a scenic route for walking and biking.

Tourist Attractions: 10/10

As one of the world's most famous beach destinations, Waikiki boasts an unrivaled array of tourist attractions. From the iconic Diamond Head crater to the historic Royal Hawaiian Hotel, there is no shortage of landmarks and points of interest. The Honolulu Zoo, Waikiki Aquarium, and the U.S. Army Museum of Hawaii are just a few of the many attractions that draw visitors from around the globe.

Things to Do: 10/10

Waikiki offers an endless variety of activities and experiences for visitors of all ages and interests. Water sports enthusiasts can enjoy surfing, paddleboarding, and snorkeling in the crystal-clear waters of the Pacific Ocean. Shoppers will delight in the neighborhood's world-class retail offerings, from luxury brands to local boutiques. The area's vibrant nightlife scene, with its numerous bars, clubs, and live music venues, ensures that the fun continues long after the sun goes down.

Average Home Prices: 6/10

According to Zillow, the median home value in Waikiki was $1,200,000 as of 2024, representing a 3.5% appreciation over the past year. While this may seem steep compared to other markets, it is important to note that Waikiki's real estate prices are driven by its prime location and strong tourism demand. The neighborhood's high density and limited land availability also contribute to its premium prices. However, for investors looking to maximize their returns, the potential for high occupancy rates and premium rental prices can offset the initial investment costs.

Proximity to Work-Related Travel: 8/10

Waikiki's central location and excellent transportation links make it a convenient base for work-related travel. The Hawaii Convention Center, a major hub for business events and conferences, is just a short drive away. The neighborhood is also well-connected to downtown Honolulu and the Ala Moana district, home to many of the city's major employers. The Daniel K. Inouye International Airport is easily accessible, with an average travel time of around 20-30 minutes.

X-Factor: 10/10

Waikiki's unrivaled combination of natural beauty, world-class amenities, and global appeal sets it apart. The neighborhood's iconic status as a tropical paradise, rich history, and cultural significance create an allure that is hard to match. For Airbnb and short-term rental investors, the opportunity to offer guests a taste of the ultimate Hawaiian vacation experience is a significant draw. With its enduring popularity and strong tourism market, Waikiki is poised to remain a top destination for visitors from around the world for years to come.

5. Top Place to Invest in Honolulu, Hawaii - Manoa

Nestled at the base of the lush Koolau Mountains, Manoa is a hidden gem in Honolulu that offers a unique blend of natural beauty, rich history, and modern amenities. This charming neighborhood, home to the University of Hawaii at Manoa, provides an attractive opportunity for Airbnb and short-term rental investors seeking to tap into the area's growing popularity among visitors looking for an authentic Hawaiian experience.

Manoa Airbnb Market Data:

• Average Revenue – $60.2K per year
• Average Daily Rate – $256.3 per night
• Average Occupancy Rate – 79%
• Average RevPAR – $212.5

Convenience: 8/10

Manoa's central location and well-connected public transportation system make it a convenient base for exploring Honolulu. The neighborhood boasts a variety of local businesses, grocery stores, and restaurants, catering to both residents and visitors. However, traffic congestion during peak hours can be a slight drawback.

Tourist Attractions: 7/10

While Manoa may not have the same concentration of tourist hotspots as Waikiki, it offers a range of unique attractions that showcase the area's natural beauty and cultural heritage. Visitors can hike to the stunning Manoa Falls, explore the lush Lyon Arboretum, or learn about Hawaiian history at the Manoa Heritage Center.

Things to Do: 8/10

From outdoor adventures to cultural experiences, Manoa has something for everyone. Hikers will delight in the challenging Pu'u Pia Trail and the iconic Manoa Falls Trail. The neighborhood also boasts a thriving arts scene, with the Manoa Valley Theatre hosting regular productions. Foodies can indulge in the area's diverse culinary offerings, ranging from casual eateries to upscale dining.

Average Home Prices: 6/10

According to Zillow, the median home value in Manoa was $1,225,000 as of 2024, representing a modest 3.2% appreciation over the past year. While this may seem steep compared to other markets, it is relatively in line with Honolulu's high-end real estate prices. The neighborhood's limited inventory and desirable location contribute to its premium prices, which may impact potential returns for investors.

Proximity to Work-Related Travel: 7/10

Manoa's proximity to downtown Honolulu and the Ala Moana district puts it within easy reach of major employment centers, hospitals, and the Hawaii Convention Center. The Daniel K. Inouye International Airport is also easily accessible, with an average travel time of around 20-30 minutes.

X-Factor: 9/10

Manoa's unparalleled combination of natural beauty, rich history, and vibrant community spirit sets it apart. The neighborhood's lush green landscapes, deep cultural roots, and close-knit community create an enchanting atmosphere that appeals to visitors seeking an authentic Hawaiian experience. For Airbnb and short-term rental investors, the opportunity to offer guests a taste of the real Hawaii, away from the tourist crowds, is a significant draw.

6. Top Place to Invest in Honolulu, Hawaii - Hawaii Kai

Nestled along the southeastern coast of Oahu, Hawaii Kai is a vibrant and picturesque community that offers a perfect blend of natural beauty, modern amenities, and investment potential. This sought-after neighborhood has become a prime location for savvy Airbnb and short-term rental investors looking to capitalize on the growing demand for authentic Hawaiian experiences.

Convenience: 9/10

Hawaii Kai boasts an impressive array of conveniences, making it an ideal location for both residents and visitors. The neighborhood is home to several shopping centers, including the Hawaii Kai Towne Center and Koko Marina Center, which offer a wide range of dining, shopping, and entertainment options. With easy access to major highways and public transportation, navigating the area is a breeze.

Tourist Attractions: 8/10

While Hawaii Kai may not have the same concentration of tourist hotspots as Waikiki, it still offers plenty of attractions that showcase the area's natural beauty and cultural heritage. Visitors can explore the iconic Hanauma Bay Nature Preserve, hike the challenging Koko Head Crater Trail, or take a scenic drive along the stunning Makapuu Point Lighthouse Road.

Things to Do: 9/10

From water sports to outdoor adventures, Hawaii Kai offers diverse activities for visitors and residents alike. The neighborhood's pristine beaches, such as Sandy Beach and Makapuu Beach, are perfect for surfing, snorkeling, and sunbathing. Maunalua Bay is a haven for boating, kayaking, and stand-up paddleboarding enthusiasts. The area also boasts excellent dining options, from casual eateries to upscale waterfront restaurants.

Average Home Prices: 7/10

According to Zillow, the median home value in Hawaii Kai was $1,225,000 as of 2024, representing a modest 3.2% appreciation over the past year. While this may seem steep compared to other markets, it is relatively in line with Honolulu's high-end real estate prices. The neighborhood's desirable location and limited inventory contribute to its premium prices, which may impact potential returns for investors.

Proximity to Work-Related Travel: 8/10

Hawaii Kai's central location puts it within easy reach of major employment centers, hospitals, and the Hawaii Convention Center. The neighborhood is just a short drive from downtown Honolulu and the Ala Moana district, making it a convenient choice for business travelers and remote workers. The Daniel K. Inouye International Airport is also easily accessible, with an average travel time of around 20-30 minutes.

X-Factor: 9/10

What sets Hawaii Kai apart is its unparalleled combination of natural beauty, community spirit, and laid-back island lifestyle. The neighborhood's stunning coastal setting, rich history, and cultural significance create an allure that is hard to resist. For Airbnb and short-term rental investors, the opportunity to offer guests an authentic taste of Hawaiian living, away from the hustle and bustle of Waikiki, is a significant draw.

7. Top Place to Invest in Honolulu, Hawaii - Makiki

Nestled in the heart of Honolulu, Makiki is a charming neighborhood that offers a perfect blend of urban convenience and natural beauty. With its proximity to downtown, diverse attractions, and unique local character, Makiki presents an attractive opportunity for Airbnb and short-term rental investors looking to tap into the growing demand for authentic Hawaiian experiences.

Makiki Airbnb Market Data:

• Average Revenue – $60.5K per year
• Average Daily Rate – $280.9 per night
• Average Occupancy Rate – 84%
• Average RevPAR – $224.7

Convenience: 9/10

Makiki's central location makes it one of the most convenient neighborhoods in Honolulu. Situated just minutes from downtown and Waikiki, residents and visitors alike can easily access major highways, public transportation, and a wide array of amenities. The neighborhood boasts numerous grocery stores, restaurants, and local businesses, catering to the needs of both locals and tourists.

Tourist Attractions: 7/10

While Makiki may not have the same concentration of tourist hotspots as Waikiki, it offers a unique blend of natural and cultural attractions. Visitors can explore the lush Makiki Valley, hike the scenic Makiki Loop Trail, or visit the nearby Honolulu Museum of Art. The neighborhood's proximity to iconic landmarks like Diamond Head and the National Memorial Cemetery of the Pacific adds to its appeal.

Things to Do: 8/10

Makiki offers a diverse range of activities for residents and visitors alike. Nature enthusiasts can enjoy hiking and birdwatching in the Makiki Valley, while culture buffs can explore the neighborhood's art galleries and historic sites. Foodies will delight in Makiki's eclectic dining scene, which features a mix of local favorites and international cuisines. The nearby University of Hawaii at Manoa also hosts various events and performances throughout the year.

Average Home Prices: 7/10

According to Zillow, the median home value in Makiki was $735,000 as of 2024, representing a modest 3.5% appreciation over the past year. While this may seem steep compared to some mainland markets, it is relatively affordable by Honolulu standards. The neighborhood's mix of single-family homes, condominiums, and apartments offers a range of investment opportunities for Airbnb and short-term rental investors.

Proximity to Work-Related Travel: 8/10

Makiki's central location puts it within easy reach of major employment centers, hospitals, and the Hawaii Convention Center. The neighborhood is just a short drive from downtown Honolulu and the Ala Moana district, making it a convenient choice for a corporate rental targeting business travelers and remote workers. The Daniel K. Inouye International Airport is also easily accessible, with an average travel time of around 15-20 minutes.

X-Factor: 8/10

What sets Makiki apart is its unique blend of urban convenience and natural beauty. The neighborhood's lush green spaces and scenic hiking trails provide a tranquil escape from the hustle and bustle of the city, while its vibrant local culture and diverse amenities offer a taste of authentic Hawaiian living. For Airbnb and short-term rental investors, the opportunity to offer guests a genuine Honolulu experience, away from the tourist crowds, is a significant draw.