Wednesday, July 17, 2024
Hawai'i Free Press

Current Articles | Archives

Tuesday, March 29, 2016
Solving Hawaii Housing Crisis Through Land Use Reform
By Grassroot Institute @ 6:40 PM :: 5525 Views :: Land Use

E Hana Kakou: Solving the Housing Crisis Through Land Use Reform

by Aaron Lief, Grassroot Institute, Mar 29, 2016

In this week’s episode, Dr. Keli’i Akina and Joe Kent interviewed Randal O’Toole, senior fellow at the Cato Institute and Grassroot Institute scholar, about the current housing crisis in Hawaii.

“I’ve been looking at housing all over the country. Where you don’t have state or urban areas strongly regulating land, housing is very affordable. The fastest growing cities in the country are able to gain over 100 thousand people a year without impacting housing prices.” Randal began.

Unfortunately, Hawaii is the most heavily regulated state in the nation when it comes to land use. “Hawaii has the least affordable housing in the country,” said Randal, “A standard measure of affordability is the median home price divided by median family income. For Hawaii as a whole, the median home prices are almost 7 times median family income… By comparison, the national average is about 2.7 times [family income]. Hawaii’s housing prices have been like this because of Hawaii’s land use laws that passed in 1961.”

Can government regulation have such a large impact on housing prices? Surely Hawaii would have more expensive housing regardless of laws, as most of the materials used in development are shipped here.

“Building materials are more expensive because of shipping costs.” Randal explained, though not enough to make this large of an impact on Hawaii’s housing prices. “If we go back to 1959 before the law was passed, Hawaii’s housing prices were about 3 times median family income. The difference is due to the Land Use laws.”

Although the rationale behind the Land Use policy was to preserve Hawaii’s land, it has come at the expense of Hawaii’s residents, explained Randal. “It divided the state into 3 parts initially. The three parts were urban, agricultural, and conservation. Later they added a rural zone. The urban zone is basically the urban areas, and its really hard to get permits to build outside of the urban areas,” said Randal.

Once the government put an artificial cap on the amount of land that could legally be developed, supply and demand took over. With limited space, housing prices skyrocketed, which increased Hawaii’s cost of living.

Currently, agricultural zoning makes up the most amount of land in Hawaii. However, Hawaii’s agriculture is currently in a decline, and much of the land is going unused.

“Between 1982 and 2007, the number of acres used for growing crops declined by almost 60%,” explained Randal, “In attempting to preserve agriculture, the state legislature destroyed it. They made housing so expensive, which, in turn, made labor so expensive, that farmers could not afford to hire labor and compete against farms… in places like Costa Rica and Fiji.”

Thus, the Land Use laws, which initially aimed to hamper development to preserve agricultural and environmental land, led to a climate in which everyone suffers. From the blue collar worker who is unable to afford a home, to the business owner who must shut down because he cannot afford to pay his employees a competitive wage, very few people have seen a positive impact from the Land Use laws.


Randal O’Toole’s report: Download (PDF, 565KB)

RELATED: Grassroot Report: How to Fix Hawaii's Housing Crisis


TEXT "follow HawaiiFreePress" to 40404

Register to Vote


Aloha Pregnancy Care Center


Antonio Gramsci Reading List

A Place for Women in Waipio

Ballotpedia Hawaii

Broken Trust

Build More Hawaiian Homes Working Group

Christian Homeschoolers of Hawaii

Cliff Slater's Second Opinion

DVids Hawaii


Fix Oahu!

Frontline: The Fixers

Genetic Literacy Project

Grassroot Institute

Hawaii Aquarium Fish Report

Hawaii Aviation Preservation Society

Hawaii Catholic TV

Hawaii Christian Coalition

Hawaii Cigar Association

Hawaii ConCon Info

Hawaii Debt Clock

Hawaii Defense Foundation

Hawaii Family Forum

Hawaii Farmers and Ranchers United

Hawaii Farmer's Daughter

Hawaii Federation of Republican Women

Hawaii History Blog

Hawaii Jihadi Trial

Hawaii Legal News

Hawaii Legal Short-Term Rental Alliance

Hawaii Matters

Hawaii Military History

Hawaii's Partnership for Appropriate & Compassionate Care

Hawaii Public Charter School Network

Hawaii Rifle Association

Hawaii Shippers Council

Hawaii Together


Hiram Fong Papers

Homeschool Legal Defense Hawaii

Honolulu Navy League

Honolulu Traffic

House Minority Blog

Imua TMT

Inouye-Kwock, NYT 1992

Inside the Nature Conservancy

Inverse Condemnation

July 4 in Hawaii

Land and Power in Hawaii

Lessons in Firearm Education

Lingle Years

Managed Care Matters -- Hawaii

Missile Defense Advocacy

MIS Veterans Hawaii

NAMI Hawaii

National Parents Org Hawaii

NFIB Hawaii News

NRA-ILA Hawaii


OHA Lies

Opt Out Today

Patients Rights Council Hawaii

Practical Policy Institute of Hawaii

Pritchett Cartoons

Pro-GMO Hawaii

Rental by Owner Awareness Assn

Research Institute for Hawaii USA

Rick Hamada Show

RJ Rummel

School Choice in Hawaii

Talking Tax

Tax Foundation of Hawaii

The Real Hanabusa

Time Out Honolulu

Trustee Akina KWO Columns

West Maui Taxpayers Association

What Natalie Thinks

Whole Life Hawaii