Hawaii Revised Statutes Division 1. Government § 171-93

(1) The department of land and natural resources shall subdivide and improve, including roads, the land to be disposed of;

(2) Such land shall be sold at fair market value or leased at fair market lease rental, as determined by appraisal, based on the land as improved;

(3) The instrument of conveyance or lease shall contain, in addition to the usual terms, the restriction that the land shall be used only for residential purposes for a period of ten years following the date of the conveyance or lease, which restriction shall be a covenant running with the land and enforceable by the board or by any surrounding owner or lessee of public land that is subject to the same restriction;

(4) If the purchaser or lessee decides to sell, lease, or sublease the land within ten years from the date of the conveyance or lease, the board shall have the first option to repurchase the interest of the purchaser or lessee at fair market value. In the event the land is acquired by the Federal Housing Administration, pursuant to a contract of mortgage insurance, or is anywise acquired by the Small Business Administration, Federal National Mortgage Association, Department of Veterans Affairs, or any bank, or savings and loan institution chartered to do business in the State or by the federal government, this restriction shall be null and void during the period of such ownership, and, to this extent, the board may waive any rights accruing to the State contained in any deed, land patent, sales agreement, or lease made pursuant to this part;

(5) The size of any lot sold under this part shall not exceed two acres; and

(6) A person eligible under this part may draw one lot for the person's property destroyed by natural disaster.