Cost of living in Hawaii


Cost of living in Hawaii is a major concern. Let’s take a look at how housing investments affect this concern.

There is embedded within the psyche of our community a theory generally expressed by the term, “Free Country.” Around that concept we have seen wound the principle of contract, of capitalism, of economic principles of investments and return on investments. We have been led to a belief that these principles, if we just leave them alone and let them work themselves out, there will be an “invisible hand” which will swoop down on the society and make everything right.

Yet, we are constantly reminded of the misery which our population continually experiences, which has gone on for at least 40 years that I am aware of. This misery is the sickness of homelessness, where we see a growing population of individuals and now families, forced to live without proper shelter, and in that life-style they are tossed into, often being tagged with criminal violations and treated in the society with deep prejudices because of those houseless conditions. Those homeless cases are the extremes. There are many more individuals and families hiding in places away from public notice and police detection. And there are those in our population who are simply unable to afford the cost of owning their own home, or renting a home.

The ills of a homeless condition reach far beyond the matter of shelter for an individual or a family. From such a condition flows the impact on a deteriorating health, loss of employment, a personal sense of loss of self-worth, a break-up of the family unit, fear, alcoholism and drug abuse, shame. Homeless communities are forming and being chased out of public areas of hiding, to seek other hiding places. Some have even gone under freeways, under bridges, up into mountains, along crevices at the seashore, in abandoned vehicles, etc.

We have a tyranny of the market that has gone berserk. Hawaii’s housing sales have become a world-wide competition such that foreigners and aliens are free to transport their monies across our Hawai`i borders with little resistance. That world capital investment game can see a large flow of money entering our shores and purchasing as many housing units including condominiums, tying up the market and sitting on these units till the next buyer decides to invest and a trade-off occurs. The State government says nothing of it because they are happy to tax these transactions and the counties too profit by the increase in “property values” determined by the increase sale transactions, which only goes to fill up the counties’ coffers. Our banks and other financial institutions say nothing about it because they too are tied into this affair, profiting from the economic activities of lending and collecting for the increased construction and the increased services they produce.

Let us be mindful that it is not only foreigners (those living in the U.S.A. mainland) and aliens (those living outside of U.S.A. mainland, but not of Hawai`i) who are important aspects of our problem of housing shortage, but they also include residents of Hawai`i who also see Hawai`i housing as investment opportunities. Many of these investors see the increasing housing demand as favorable for their investments, giving little or no attention to the social ills which they contribute to by this investment!

The other part of this economic cycle lacking the proper social consciousness are sellers of such real property, whose general interest is found in a profit motive and will naturally sell to the highest buyer.

The government, generally expected to act as the watchdog over the social and economic wellness of the society, have not connected the economic activity adequately with the social impact such activity is having and is engaged in supporting these economic activities.

We need to call for a new public policy aimed at making homes available to our residents. One way of doing this is to limit to 1 resident an individual is entitled. There should no longer be any hording of real property for investment purposes. If a buyer is not going to use said property as his/her primary residence, there will be a penalty to pay for the purchase and for the continuing annual retention of such residence to assist in the housing shortage which exist in Hawaii.

Any person owning more than one residential unit in Hawaii will be prohibited from purchasing another unless and until that person has relinquished his current residence to a local buyer in Hawaii who will use said residence as his/her home.

There will be attempts by some individuals to disperse their real property residential ownerships to members of their family who may not actually use such other real property as their residence. There may be attempts to name children still living in the same family household as residence of another home which the investor wishes to retain.

Laws will have to be adjusted to meet those attempts to circumvent the policy, including investigations and penalties whenever a person claims to reside in a property and it is found not to be the case. Any transfer of title to real property to a person who does not truly reside on said property, or if the transfer is merely a sham covered over with a title transfer, but with a side agreement or understanding that the property will be returned or managed under the instruction of the transferring person, if found out, the “side agreement or understanding” should be considered an attempt to defraud the government and such a side agreement could be set aside or declared null and void and the transfer will be recognized as valid without any such side agreement.

There may be other attempts to circumvent the law and such attempts will have to be dealt with by the courts or the legislature after the initial policy and the guidelines and legal codes adopted to carry out the policy is made. There are other experiences in Pacific Island nations which follow somewhat similar prohibitions against certain types of investments, and although there have been attempts to circumvent the law, the legal systems have dealt with such situations.

Real estate in Hawaii is too important to be used with such a negative impact as the type of homelessness which we suffer today. We should not have to continue under the present condition which sees the incoming flight of capital to Hawai`i while at the same time, we witness the outgoing flight of our local population because they can’t even afford to have a home in Hawai`i.

Yes, the adoption and practice of this policy of limiting investing families only one residential unit will take time to become a practice. But if we are serious about controlling Hawaii’s future for Hawaii’s people, this is certainly one place where we need to begin that control.

Poka Laenui for the Hawaii National Transitional Authority Working Group


Hawaiian Perspectives


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