Kapaau, HI

  • Overview
  • Performance
  • Listings
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Key Performance Metrics

Market snapshot

Performance indicators for the Kapaau short-term rental market based on reliable data.

Listings

74 / 133

Reliable / Active

Cap Rate

5%

Middle-Earners Gross Yield

Revenue

$30,802

Middle-Earners Revenue

Occupancy

58%

Middle-Earners Occupancy

Home Value

$614,477

Median Home Sale Price

Top Earners

$77,717

Top-Earners Revenue

Kapaau

Market Revenue Seasonality

Top Listings

Highest revenue

The highest-performing listings in Kapaau.

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C

Challenging to Investors

Kapaau Regulations

Kapa'au's STRs are technically allowed but face significant constraints: zoning restricts operations to commercial/resort zones or properties with hard-to-obtain Non-Conforming Use Certificates, creating limited viable areas. Permitting requires multiple steps (state TAT/GET, county TAR registration), ongoing compliance (noise/parking/occupancy rules), and substantial taxes (17.75% combined). Enforcement is strict with penalties for non-compliance, and future regulations may phase out residential/agricultural zone STRs, creating high investor risk.

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About Kapaau

Kapaau is a small, unhurried community tucked into the North Kohala district of Hawaii County, on the northern tip of the Big Island of Hawaii. With a population of just a few hundred residents, the town has the character of a quiet rural Hawaiian village, ringed by green pastureland, eucalyptus groves, and dramatic ocean bluffs. Kapaau is best known as the home of one of Hawaii's most iconic cultural landmarks, the King Kamehameha I statue, and it serves as a gateway to the wild, scenic northern reaches of the island. It sits roughly 55 miles north of Kailua-Kona along the island's west coast and well over an hour from the larger population centers of Waimea and Hilo.

The King Kamehameha I statue in Kapaau stands in front of the North Kohala Civic Center, a striking nine-foot bronze figure depicting the chief who unified the Hawaiian Islands and founded the Kingdom of Hawaii. The statue is ceremonially draped in lei during the annual Kohala King Kamehameha Day celebration each June, and it remains one of the most photographed landmarks on the northern Big Island. Just a few minutes' walk from the town's small commercial center, it is easily the most visited site in Kapaau itself.

Just a short drive east of town, the Pololu Valley Lookout marks the end of the road in North Kohala. From this bluff, visitors gaze down into a steep, lush valley that drops toward a black-sand beach, with the rugged Hamakua Coast stretching into the distance. A hiking trail leads from the overlook down into the valley floor, making it a popular spot for travelers seeking a quieter, more rugged alternative to the Big Island's more developed beaches.

A bit to the south, Pu'ukoholā Heiau National Historic Site preserves the massive stone temple built by Kamehameha I in the late 1700s as part of his campaign to unite the Hawaiian Islands. About a 30-minute drive from Kapaau, the site overlooks Kawaihae Harbor and offers interpretive trails and a small visitor center. The neighboring town of Hawi, with its art galleries, coffee shops, and plantation-era storefronts, sits only about five minutes from Kapaau, while Lapakahi State Historical Park, the remains of an ancient coastal fishing community, lies roughly 20 minutes down the coast.

Kapaau's appeal as a short-term rental base lies in its authentic, off-the-beaten-path feel. It offers visitors a taste of pre-resort Hawaii while keeping them within easy reach of dramatic valleys, sacred historical sites, and the cultural heart of North Kohala, all well away from the busier resort corridors further south along the Kohala Coast.

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