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Here are some excerpts from a much longer article in Civil Beat about the whys and wherefores of the challenges of renting a home in Hawai'i. Follow the link for the full article and 5 infographics.
Quote:
Living Hawaii: Where the Rent Is Too Damn High
Islanders pay far more on average than in any other state to live in rentals — and that's just the beginning.
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If the rate of construction permitting holds for the rest of 2014, it would mean Oahu authorizes the fewest new housing units of any year since 1944. — Paul Brewbaker, economist
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Moderator cut: very long quote shortened, copyright protection. Please read the tos
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Get rid of the paradise tax and you will have more affordable housing. Simple.
The so-called "Paradise Tax" is not something you can get rid of, because it is merely a humorous label for the aspect of human nature that has people all over the world willing to pay more for housing and accept less pay to live in a place they consider "paradise."
Although a long read... I only grabbed excerpts from the article... I think the article raises some significant talking points for anyone concerned with the long-range picture of growth and development in the state.
#1 among them, I think, is that the only solution to the "affordable" housing shortage in Hawai'i is to build a lot more lower cost housing, and to increase housing density... something that both the public and government officials have long resisted.
No, of course not... Sonny Silva OWNS housing that is more affordable than the apartment where he currently lives. He just illustrates the great length some people will go to in order to live in their fantasy.
And as the article points out, he's just one fall off the scaffolding away from disaster, and he's selling out his future to live above his means today, but isn't that the American way? Everybody has the freedom to be as stupid as they choose to be.
[quote=OpenD;37541796]The so-called "Paradise Tax" is not something you can get rid of, because it is merely a humorous label for the aspect of human nature that has people all over the world willing to pay more for housing and accept less pay to live in a place they consider "paradise." ]
Lets get real ok, if you gave someone an option to pay 1,500 for an apartment in Oahu or 1,000. I bet most would choose 1,000 right? Lets not cherry coat what the "paradise tax" is. It just a polite term for "Lets charge as high as humanly possible for rents just short of rioting". Another words greed. The excuse for this behavior is "People all over the world are willing to pay more for housing and accept less pay to live in a place they consider "paradise."
Im sorry i don't mean to come across as cras or "wit stink" but the solution for affordable housing isn't going to be in encouraging the behavior that got us there in the first place. And the first step to social change is to educate people on what
really is going on. But your right its a society and human issue and its not going to change intel its not profitable for the majority.
As for the future, i would kinda disagree with building a ton of new housing because its a temp fix, Hawaii is the last fronter, this is it. Overbuild and you will eventually lose what made Hawaii glamorous to live in and the bottom will fall out. Just my opinion and further theres more to life then money and profits.
Everybody has the freedom to be as stupid as they choose to be.
So true. And I see people excersizing that freedom everyday. Then wondering what went wrong.
Quote:
Originally Posted by OpenD
#1 among them, I think, is that the only solution to the "affordable" housing shortage in Hawai'i is to build a lot more lower cost housing, and to increase housing density... something that both the public and government officials have long resisted.
I don't think building more housing is the best direction for Hawaii. I doubt they really could build enough to exceed demand to the point where it would put significant downward pressure on price. And the pressure it would put on resources could be a real downside.
I would suggest progressive taxation measures to diminish demand. One I mentioned in a different thread is an Income Tax that hits new residents hard for the first 5-yrs they are on island. For example, if you were considering moving to Hawaii but, as a new resident you would pay a 35% state income tax rate for the first 5-yrs, you likely would not move to Hawaii. Existing residents and residents who have been on-island 5+ yrs would have a long-term resident deduction that would bring their tax down to current levels. Imagine how that would disincentivise people from moving to the island.
Also, if you put a 50% Capital Gain Tax on real estate gains sold by non-resident owners, the off-island purchasers of real estate would likely not buy because it no longer would make any sense. The market would slowly return to a locally driven market as international buying demand drops.
Both of these would dramatically slow the demand for real estate by non-locals and also slow the flow of new people to he island.
Problem is, the real estate industry would strongly oppose this and, even the government itself would oppose it because it would result in less overall tax revenue.
I personally don't like those type of measures. However I think they would be effective.
The so-called "Paradise Tax" is not something you can get rid of, because it is merely a humorous label for the aspect of human nature that has people all over the world willing to pay more for housing and accept less pay to live in a place they consider "paradise." ]
Lets get real ok, if you gave someone an option to pay 1,500 for an apartment in Oahu or 1,000. I bet most would choose 1,000 right?
That has absolutely nothing to do with it if all the apartments are $1,500 and there is more demand than supply at that price... as there is now.
Quote:
Lets not cherry coat what the "paradise tax" is. It just a polite term for "Lets charge as high as humanly possible for rents just short of rioting". Another words greed. The excuse for this behavior is "People all over the world are willing to pay more for housing and accept less pay to live in a place they consider "paradise."
Sorry, you are letting your social/political beliefs blind you to the simple facts pointed out in the article. When the rents are too high, people don't riot, they simply don't rent at those prices... or they adopt strategies for dealing with them. It's not that long ago that IT people in the Silicon Valley were renting half-day time slices on beds at $1,000 per month. Totally insane? Yes, but that's what people will do, and it's not much different in Gold Rush camps and the like all over the world.
And in NYC, attempts to rent apartments at below market prices, such as "rent control" simply leads to people subdividing apartments and subleasing them for more than they pay. The market price is not set by greed, it's set by demand. If nobody is willing to pay $1,500 for an apartment, it won't be a $1,500 apartment. It will be a $1,400 or a $1,300 or a $1,200 or whatever the market actually will bear apartment.
Quote:
Im sorry i don't mean to come across as cras or "wit stink" but the solution for affordable housing isn't going to be in encouraging the behavior that got us there in the first place.
Exactly, but as the article clearly illustrates, the behavior that got us there was not building nearly enough housing to keep up with demand.
Your quote: Sorry, you are letting your social/political beliefs blind you to the simple facts pointed out in the article. When the rents are too high, people don't riot, they simply don't rent at those prices. end guote:
They don't rent thy become local homeless. My riot wording wasn't to be taken serious, but yes i do believe that some people are not to happy with the term "affordable housing today being to build housing that is affordable for those who make a min of 100,000 - 125,000 year range being thrown around." Social/Political beliefs aside what would you call that?
Your quote: Exactly, but as the article clearly illustrates, the behavior that got us there was not building nearly enough housing to keep up with demand. End quote:
Interesting you support that conclusion, so you think if we built enough housing for demand that rents will be cheaper? Doubt it. We are talking Hawaii. Like i said nothing will change intell the majority finds the current way of doing things not profitable.
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