Hawaii is Failing in Affordability and Homebuilding: Can Gov. Green Change That?

by Dina Sartore-Bodo, Realtor.com, October 29, 2025

The Realtor.com® State-by-State Housing Report Card has dealt Hawaii a hard truth: The Aloha State earned an F for housing affordability and homebuilding.

The report—part of the Realtor.com Let America Build campaign—grades all 50 states based on how well they balance affordability with new-construction activity.

Hawaii’s low marks underscore how difficult it has become for residents to afford a home in paradise, where high land and construction costs continue to squeeze supply.

But the issue is a national one. In fact, President Donald Trump recently put pressure on large homebuilders to increase construction nationwide. In a post on his Truth Social platform in early October, he accused major builders of hoarding lots to prop up prices—likening them to OPEC, which restricts oil output to maintain high prices.

“They’re my friends ... but now, they can get Financing, and they have to start building Homes. They’re sitting on 2 Million empty lots, A RECORD,” Trump wrote. He urged Fannie Mae and Freddie Mac to intervene and “get Big Homebuilders going” to “restore the American Dream.” 

But is there more that Hawaii’s own government can do to fix the problem?

Affordability falls short in paradise

Hawaii’s total score of 15.8 placed it near the bottom of the national rankings. The state’s median list price of $822,065 is among the highest in the country, while median household income sits at $91,385—leaving the average family priced out of much of the market.

When it comes to new construction, the numbers don’t provide much relief. Only 0.2% of the nation’s new-home permits were issued in Hawaii last year, despite the state representing 0.4% of the U.S. population. That translates to a low permit-to-population ratio of 0.50, signaling that the state isn’t building enough to meet its needs.

Even the new-construction premium—the price gap between new and existing homes—is 26.2%, suggesting that most new builds are high-end and out of reach for everyday buyers.

Regional perspective: How Hawaii stacks up

According to the most recent Realtor.com New Construction Insights, the South and West are leading the charge in new homebuilding, helping to cool prices and expand availability. The median price for a newly built home nationwide stood at $450,797 when the report was released in February, virtually flat year over year. At the same time, resale prices climbed 2.4%, driving the new-construction premium to a record low of just 7.8%—a sign that new builds are increasingly competitive.

But Hawaii’s market moves in the opposite direction. In the Honolulu metro, the median list price for new builds was $887,000, with a 32.4% premium compared to resale homes. That places Honolulu among the 10 U.S. metros most likely to attract out-of-town new-home shoppers rather than locals, highlighting how mainland and international demand continues to influence Hawaii’s housing costs.

Nationwide, the supply picture is improving, with new-construction listings having surged 37% since early 2020, but they are still lagging.

“America is short more than 4.7 million homes, and every new home built helps close that gap while fueling local economies," says Shannon McGahn, executive vice president and chief advocacy officer at the National Association of Realtors®. "NAR research shows that the U.S. has faced a persistent housing shortage for more than a decade, driving up prices and limiting options for buyers. Expanding housing supply creates jobs, supports small businesses, and affords families the opportunity to build generational wealth.”

Gov. Green moves to unblock housing delays

Given the constraints that Hawaii is in, Josh Green became the first governor in the nation to declare their state’s housing crisis a statewide public emergency in summer 2023.

“We are committed to taking bold action to address the state’s housing crisis, which is one of the biggest economic and social challenges facing Hawai'i families today,” Green told Realtor.com.

“If we don’t build enough housing, then the health of our society suffers. Because if we don’t have enough housing, you won’t have enough nurses. If you don’t have enough housing, we won’t have enough firefighters. If we don’t have enough housing, we won’t have enough police officers.”

Understanding the severity, the Green administration introduced the $6.6 billion Ka Lei Momi project, one of the largest public housing ventures nationwide. The project vows to redevelop nine state public housing projects and 10,000 new low-income and workforce housing units around the islands. 

Since then, according to Green’s team, more than a dozen affordable housing projects have taken advantage of the exemptions and waivers in the emergency proclamation, creating more than $24 million in savings for builders, renters, and homebuyers. 

In 2025, he signed House Bill 420 (Act 308), a measure targeting litigation-related delays that have long plagued Hawaii’s construction pipeline. The new law amends the Contractor Repair Act and Statute of Repose to reduce costly defect lawsuits and speed up repairs, mediation, and settlements between contractors and homeowners.

“This bill is a couple of years in the making, and today’s signing marks a step toward removing roadblocks for affordable, accessible housing in Hawai‘i,” said Green at the time. “HB 420 is a solution-based measure that tackles one of many contributing factors to our rising cost of living in the islands.”

The bigger picture: Building a path forward

The National Association of Home Builders echoes Hawaii’s need for reform. Its Blueprint To Address the Housing Affordability Crisis report calls for sweeping changes, such as eliminating excessive regulations and fixing supply chain bottlenecks, to “remove barriers that hinder the construction of new homes and apartments” nationwide.

For Hawaii, these priorities align closely with what’s already on Green’s agenda: tackling procedural delays and improving efficiency across the construction process. But reversing decades of underbuilding will take more than one bill. The state’s challenge now is translating these reforms into faster permitting, more diverse housing types, and a measurable uptick in home production.

Until that happens, Hawaii’s F grade serves as both a warning and a roadmap: Affordability can’t improve without supply, and supply won’t increase without systemic change.

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