It has become a major issue for the State of Hawaii to provide affordable housing options for a large and increasing population. The cost of living in this state is one of the highest in the nation. It becomes more challenging to overcome the difficult task of finding solutions each year. No active legislation has addressed the permit backlog and dumping of costs toward development companies to explore affordable housing solutions. This along with increasing real estate prices and standard return on investment reasoning makes for low production of affordable and low-income housing. If permitted some properties can qualify for subsidies and grants to stay in operation, without the displacement of fixed income residents that would otherwise not have enough money for rent. Other regions have transit-oriented funds that provide financing as incentives for development near mass transit infrastructure. Young professionals and new families find it difficult to afford rental properties for housing with the rising costs in Hawaii. How can they plan on building a future and family with little hope of owning a home while real estate prices continue to rise faster than earnable income levels for most residents?
Many families in our state have remained in multi-generational living situations due to the cost of living and housing. If we are hoping to retain our resident population we need to provide more options for them to consider continued residency as they look to provide a stable living for themselves and their children. Real estate prices continue to increase at a rate of 3% for homes and 5% for condos annually. Median prices for single-family houses and condos reaching all-time highs for the 5th year and are projected to continue increasing to nearly $800,000.00 for a house and $430,000.00 for a condominium in 2018. The average income has not changed at a corresponding rate of increase with that of real estate prices. Income at $83,700.00 annually for a household of four is now considered “low-income” on Oahu, according to HUD calculations. Include the semi-transient military residents and their impact on housing availability along with high demand pricing that corresponds directly to the influx and redeployment of most military families in Hawaii. These factors create a desperate situation for the average household in planning and affording the future.
In many cities with lower cost of living than those in Hawaii, the need for affordable or transitional housing has continued to fall short of demand. New construction technologies and lower cost materials are helping to facilitate the planning of realistic solutions across the country. Victor Geminiani is co-executive director of the Hawai’i Appleseed Center for Law and Economic Justice. He says privatization of public affordable housing can work but a culture of inclusion is key.
One of the biggest obstacles for existing communities and housing facilities is long-term stability and managing overhead. The real question is how do we encourage partial privatization of affordable housing that can provide long-term solutions for individuals, young families and the elderly in an ever-expanding population? Some property developments incorporate the rising costs of maintenance with homeowner association dues and condominium fees. These additional fees can exclude residents due to the cost. Dues and fees are commonly used to provide the community with a sustainable environment, retained market value, and standard of living. Many associations also impose restrictions and regulations that also maintain the common areas for community activities, trails, parks, and recreation centers.
Prefabricated units of various design have been incorporated in vertical communities that also provide a range of social services for the elderly and low-income residents. In other rural areas, the same prefabricated or minimum construction type units are placed in communal environments that are available to poverty level families in desperate need. These subsidized programs and need additional consideration to accommodate the next level of income and provide realistic options for those living at or slightly above the poverty line.
Millennials are primarily looking for locations that provide easy access to amenities, transportation and municipalities, including some luxury conveniences, while less concerned about dwelling size. In an attempt to attract this consumer many cities have allowed loosened restrictions on minimum dwelling size and the permit process for build-out. Less than 1 % of existing housing stock is built each year. The construction of modular and prefabricated housing units have evolved along with commercial use and office design. The incorporation of useful public facilities and resources to an existing rural landscape can facilitate the build-out of communities, especially with portable types of buildings and prefabricated designs that accommodate a variety of uses including housing. The use of micro-units would provide flexibility and affordability.
In recent years some cities were looking to rent out parking stalls for residential use, the “9×18” proposal by the Institute for Public Architecture examined the relationship of housing expense and regulations for land use such as parking stalls and their use per resident. In a groundbreaking step towards new residential design and construction concepts, cities like San Francisco, New York, and Los Angeles lead the way with innovation and modernization. Each region has its own geography and culture to consider. In the trial stages, their existing projects are seeing success and also the need to consider multiple-story townhouse and cottage units for neighborhood variety and appeal. The design for many campus communities today already look to this type of micro-unit housing solution.
Subsidizing the build out of modernized scalable communities would promote personal investment from future generations. As our economic system does not allow for income adjustments according to fluctuations in property values, updated legislation for (IHA) Independent Housing Accounts, financial education programs, and other tax-based incentives need to find resolution through public policy. The time is now for realistic goals to be formulated and implemented.
The economy continues to reshape itself in our more populated cities and towns. Urban and rural environments are blending with state of the art designs like green roofs, solar panels, and micro-housing. We must find more affordable and efficient methods of commuting and living if we are to remain desirable as the price of residency in Hawaii is becoming more exclusive. Simplified creative designs for micro-unit construction and ergonomic environments provide better use of space within less square footage.
The State reports it’s on track to build 10,000 new residential units by 2020, 40% of those to be affordable. The State must also develop alternatives like micro-housing that our existing residents will find desirable and be able to afford. It would be prudent for agencies and programs to model those that have seen success in other states and regions. Budgeting for state-regulated programs that focus on retention of public housing through grants and privatization provide needed relief. New and updated legislation is required and must encourage private investment in affordable housing programs along with incentives to strengthen our infrastructure and resources for residents, not the absentee-owners or outside investors.