Key Takeaways
- Hawaii uses standard purchase contracts developed by the Hawaii Association of REALTORS (HAR)
- Contracts must include all essential elements: offer, acceptance, consideration, legal capacity, and legal purpose
- Earnest money deposits must be deposited into a trust account within a reasonable time
- Hawaii follows the mailbox rule for acceptance of offers unless otherwise specified
- Electronic signatures are valid under Hawaii's Uniform Electronic Transactions Act
Last updated: January 2026
Hawaii Real Estate Contracts
Hawaii uses standard contracts developed by the Hawaii Association of REALTORS (HAR). Understanding contract law is essential for Hawaii real estate practice.
Standard Hawaii Contracts
Purchase Contract (DROA)
The Deposit Receipt Offer and Acceptance (DROA) is the standard residential purchase contract:
| Feature | Description |
|---|---|
| Developer | Hawaii Association of REALTORS |
| Use | Residential property sales |
| Status | Not state-promulgated |
| Updates | Revised periodically |
Other Contract Forms
| Contract Type | Use |
|---|---|
| Counter Offer | Modify terms of original offer |
| Addendum | Add provisions to contract |
| Cancellation | Terminate existing contract |
| Vacant Land | Sale of undeveloped land |
Essential Contract Elements
Requirements for Valid Contract
| Element | Description |
|---|---|
| Offer | One party proposes terms |
| Acceptance | Other party agrees to terms |
| Consideration | Something of value exchanged |
| Legal capacity | Parties competent to contract |
| Legal purpose | Lawful objective |
| Written form | Required for real estate (Statute of Frauds) |
Statute of Frauds
Real estate contracts must be in writing:
| Requirement | Description |
|---|---|
| Written | Signed by parties to be bound |
| Description | Adequate property description |
| Terms | Essential terms included |
| Signature | Signed by party to be charged |
Earnest Money
Deposit Requirements
| Requirement | Details |
|---|---|
| Purpose | Shows buyer's good faith |
| Amount | Negotiable, typically 3-5% |
| Deposit timing | Within specified time in contract |
| Trust account | Required for broker-held deposits |
Handling Earnest Money
| Situation | Broker's Duty |
|---|---|
| Receipt | Deposit in trust account promptly |
| Conflicting claims | Hold funds, may require court action |
| Successful closing | Applied to purchase price |
| Buyer default | May be retained as liquidated damages |
Trust Account Rules
| Requirement | Details |
|---|---|
| Federally insured | Must be in Hawaii bank |
| No commingling | Cannot mix with broker's funds |
| Record keeping | Detailed records required |
| Supervision | Principal broker oversight |
Offer and Acceptance
Making an Offer
| Element | Description |
|---|---|
| Written form | Standard purchase contract |
| Price and terms | All material terms stated |
| Time limit | Expiration date for response |
| Earnest money | Deposit amount specified |
Acceptance
| Type | Effect |
|---|---|
| Acceptance | Creates binding contract |
| Counter offer | Rejection of original offer |
| Rejection | Terminates offer |
| Expiration | Offer terminates automatically |
Mailbox Rule
Hawaii follows the mailbox rule:
| Event | When Effective |
|---|---|
| Acceptance | When properly dispatched |
| Revocation | When received |
| Rejection | When received |
Default and Remedies
Buyer Default
If buyer breaches contract:
| Remedy | Description |
|---|---|
| Retain earnest money | As liquidated damages |
| Specific performance | Force buyer to complete purchase |
| Actual damages | Sue for losses |
Seller Default
If seller breaches contract:
| Remedy | Description |
|---|---|
| Return of deposit | Buyer gets money back |
| Specific performance | Force seller to convey |
| Actual damages | Sue for losses |
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Test Your Knowledge
What is the standard residential purchase contract used in Hawaii called?
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Test Your Knowledge
Under the mailbox rule, when does acceptance of an offer become effective?
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