When it comes to affordable housing, it is obvious that Hawaii desperately needs it. Recent reports from the Honolulu Board of Realtors show that sales are at all time highs for single family and condominium homes, but the thing is that salaries are not increasing as fast as property prices and many local residents are getting priced out of the market.
When it comes to new construction, developers must set aside at least 20% of the building to affordable or reserved housing. But some developers get around this requirement by building an entire separate building for reserved/affordable housing. So that they can market their building as "a luxury building." While this seems rather sneaky, unfortunately it is the way it is and it's very hard to change. edit.
Luckily SamKoo Pacific, LLC has been a pioneer when it comes to bringing affordable housing units to Oahu. They recently sold Kapiolani Residence which is set to open at the end of this year and it had 60% go towards affordable housing. Their next project, The Central Ala Moana, will be their second project and will give another 60% to affordable housing (310 units) which is more than 3 times the normal requirement.
"According to Paul Brewbaker, former State Economist and Preseident of TZ Economics; Oahu needs 3500 new housing units per year."
Unfortunately, the state typically issues a maximum of 1500 permits for new housing. Building permits issued between 2009 and 2014 were lower than in any period since WWII. Because of this, each year we fall behind by 2000+ housing units.
Affordable housing however requires a fine balancing act. You need to make under a certain income but you need to make enough to qualify for the loan. For affordable housing, they work backwards using the area median income and price the units accordingly based on what that income bracket can afford. Plus they also allow gift funds, or co-signers.
If you missed out on Kapiolani Residence and are looking for the next affordable housing project, then The Central Ala Moana is what you have been waiting for. Don't forget to sign up today to get the latest information below!