Hawaii, known for its stunning landscapes, rich cultural diversity, and pleasant weather, also has a reputation for having an exorbitant cost of living, especially when it comes to housing. According to a UHERO assessment, a substantial income is needed in the state in order to purchase housing. To afford the median home in 2022, a buyer’s salary had to be close to 180% of the state median, or around $150,000 per year. A similar obstacle faced by condo buyers was that they needed to make $100,000, or 120% of the state’s median salary.
Still, not every city in Hawaii is as expensive as another. Some places are more difficult for the average buyer or renter because of a mix of high home prices and lower salaries. Using information from UHERO, Civil Beat, and the U.S. Census Bureau, let’s examine three Hawaiian cities where affordability may be seen as a problem.
Honolulu
Hawaii’s largest and capital city, Honolulu, is recognized as the state’s center of culture and commerce. In addition, it’s the most costly city in the state. The median price of a house was $1,890,000 in 2022, while the median price of a condo was $319,347. In Honolulu, $314,000 in annual income was needed to afford a home, which is around 417% of the state’s median salary. A $106,000 annual income, or 141% of the state median income, was required to qualify for a condo.
In this regard, Honolulu also had difficulties, with a renter share of 61.4%. In 2019, the typical rent was $2,134, or 28.8% of the median income of a household. However, many tenants faced an extra strain as the median asking rent on Craigslist jumped to $2,200 in 2023. More than a third of renters spent more than 50% of their income on rent, and nearly half of tenants spent more than 30%.
Kailua
Kailua, which lies on Oahu’s windward side, is well known for its stunning beaches and relaxed way of life. Purchasing a home in Kailua remained difficult even with its comparatively high median household income of $130,000, or 173% of the state’s median income. The median cost of a house was $1,650,000 in 2022, while the median cost of a condo was $525,000. An annual salary of $275,000, or 366% of the state median income, was required to afford a home in Kailua. An annual salary of $139,000, or 185% of the state median income, was needed to qualify for a condo.
At 28.6%, Kailua featured a low renter share. Nevertheless, the problems continued, with a median rent of $2,500 in 2019—23.1% of the typical household income. Twenty-three percent of renters were significantly overburdened by their rent, and nearly a third were barely making ends meet when the median asking rent on Craigslist increased to $3,000 in 2023.
Laie
Located on Oahu’s north shore, Laie, which is home to Brigham Young University-Hawaii and the Polynesian Cultural Center, struggles with affordability. The median house price in Laie reached $1,500,000, with a median condo price of $400,000 in 2022, despite a median family income of $100,585, or 134% of the state’s median income. In Laie, a person needed to make $250,000 annually, or 333% of the state median income, to afford a home. A $106,000 annual income, or 141% of the state median income, was required to qualify for a condo.
Laie had comparable problems with rentals, with a noticeably high renter proportion of 61.4%. In 2019, the typical rent was $2,134, or 25.5% of the median income of a household. In 2023, the median asking rent on Craigslist was $2,200, which affected over half of renters who were overly indebted and more than a third of those who were significantly overindebted.
Conclusion
Although many people consider Hawaii to be a paradise, the state’s housing costs are a nightmare for many. Even while the state has taken action to solve the housing problem, more must still be done to guarantee that all citizens, regardless of geography or income level, have access to safe, decent, and affordable housing. Comprehensive policies are required to address the unique requirements of lower-income inhabitants and prevent the displacement of existing communities, in addition to measures like Bill 7, which are intended to encourage the building of affordable rental units.
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