Rising interest rates and a drop in sales have done little to lower average home prices.
Only 1 in 5 households in Hawaii can afford to buy a single-family home — a dramatic drop from just three years ago, according to a grim housing report released by the University of Hawaii on Monday.
In 2021, 44% of Hawaii households could afford the mortgage on a median-priced single-family home. That figure is now 20%. As a result, home sales plummeted last year, hitting a 25-year low. But the slump had little impact on prices.
“We haven’t really seen any drop in prices, but there’s this huge increase in what it costs to buy a house because of interest rates,” said Justin Tyndall, an assistant professor of economics with the University of Hawaii Economic Research Organization and the lead author of the report. “Affordability is as bad as it’s ever been.”
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Hawaii has “both the highest construction costs and highest land costs of any state in the U.S.,” according to the report. However, regulatory costs play a dramatic role in the state’s high condo prices. (Cory Lum/Civil Beat/2022)
High interest rates have had a crippling effect on would-be homeowners in the state by not only making mortgages significantly more unaffordable, but also reducing the number of houses on the market.
A majority of mortgage-holders in the state are paying an interest rate of less than 4%, according to the report, making many homeowners wary of putting their home on the market and trying to purchase something else at a much higher interest rate.
The state’s housing market has also worsened for renters in the last year. Hawaii has the highest median rents in the nation and a majority of renters — 56% — are considered “rent-burdened,” meaning they spend more than 30% of their income on rent.
The Maui fires worsened the state’s housing crisis, causing prices to rise while “the availability of rentals have plummeted,” according to the report.
Vacation Rentals And Out-Of-State Buyers
Short-term vacation rentals make up about 6% of the state’s housing stock, a figure that has grown in recent years but also varies dramatically by island. The number of active short-term rental listings grew 9% statewide between 2022 and 2023. Kauai saw the biggest spike, with a 22% jump in listings.
The number of short-term vacation rentals on Maui has actually increased slightly since the fires, despite the loss of 380 vacation rentals in West Maui and tax incentives for unit owners across the island to convert their units into long-term housing.
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“The policy was supposed to incentivize a bigger shift away from vacation rentals and toward housing locals, but we haven’t really seen that in the aggregate,” Tyndall said.
While short-term vacation listings on Maui plummeted after the fire, they are now 2% higher than they were a year ago.
The percentage of out-of-state property owners varies dramatically by community, (Screenshot/2024)
The report also found that “a significant portion of Hawaii’s property owners” are not residents of the state. People from out of state made up 13% of property owners on Oahu and 32% on Maui. More than half of property owners in Lahaina had an out-of-state mailing address.
On Maui, about 85% of vacation rentals are owned by people from out of state, Tyndall said.
Another big takeaway from the overall data, Tyndall said, is that the state isn’t building enough housing to have any real impact on affordability. The state has significant issues with permitting delays, although some progress has been made in the last year in multiple counties, according to the report.
However, strict limits on where multi-family homes can be constructed, along with steep developer fees and permitting delays contribute to the high costs of condos and “reduce the amount of new housing the state.”
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“While many households have a preference for single-family homes, building high-rise condominiums can provide many more units, allowing vacancies to propagate across the market, and pushing down housing prices everywhere, including for single-family homes,” the report says.
Converting thousands of vacation rentals into long-term rentals — which Maui’s mayor is proposing to do — could have a really significant impact on affordability, Tyndall said.
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HONOLULU (HawaiiNewsNow) – Gov. Josh Green predicted Friday that thousands of Hawaii residents may give up their health insurance after Congress did not extend subsidies for Affordable Care Act policies.
Green pledged millions in local taxpayer funds to help them maintain coverage.
Hawaii’s 24,000 Affordable Care Act customers faced uncertainty in December as they had to reenroll without knowing whether extra subsidies would be extended.
Now that the subsidies are ending, customers must find more money or reduce their coverage.
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Premium increases force difficult choices
Insurance agent and radio host Martha Khlopin works with about 300 people who depend on ACA premium subsidies.
“People, I think, will be making the decision, taking that risk and just praying they don’t get sick,” Khlopin said. “So I pray that too. Don’t get sick in 2026, because your premiums and co-pays might be a lot.”
As an example, Khlopin cited a 50-year-old man who makes $40,000. He was paying about $170 a month this year for a plan with good coverage. His new plan will cost about $500 a month starting in January.
“It’s a pretty big increase for him,” Khlopin said. “So what he decided to do was just use his savings to cover the premiums because he really needs to keep the very generous platinum plan that he has right now.”
Coverage downgrades expected
Khlopin said others are downgrading their coverage, choosing lower premiums but much higher out-of-pocket costs and deductibles.
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“So it’s a lower premium, but you have higher cost because you have to meet a deductible,” Khlopin said, noting that could lead some people to avoid care.
“So if I do need a particular procedure that’s expensive, I might decide not to get that done, which ultimately can cause more problems down the road,” Khlopin said.
Green predicted an even more dire scenario with thousands choosing to go without coverage.
“That’s really bad, because it’s not just the lack of insurance for them. It’s also $150 million of uncompensated care to rural facilities to our community health centers,” Green said.
State tax credit proposal
Green proposed that the state make up the lost subsidies with a state tax credit for about 8,000 ACA customers.
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“The analysis we did is that to do the enhanced subsidy that Congress walked away from for now would cost $16.5 million,” Green said.
“That would definitely be a very, very wonderful gift to people to know that there is some relief coming to lower those health insurance premiums,” Khlopin said.
What remains unclear is how quickly that aid could reach policyholders and what will happen to those who decided not to renew when the deadline for open enrollment ended Monday.
Copyright 2025 Hawaii News Now. All rights reserved.
Southwest Airlines is adding more routes from Sin City to the Aloha State.
The airline, which is headquartered at Dallas Love Field, will fly from Harry Reid International Airport in Las Vegas to Hilo International Airport starting Aug. 6, 2026. The service will operate on Mondays, Thursdays and Fridays, pairing with existing service between Las Vegas and Honolulu.
“When I took office, I pledged to strengthen ties with the ‘Ninth Island’ — Las Vegas, where many Hawaiʻi-born residents live,“ Hawaii County Mayor Kimo Alameda said in a statement. ”Southwest’s renewed service shows its dedication. Quicker flights across the Pacific means more convenience for our local families and another chance to support our hometown airline.”
Hawaiian Airlines is Hilo’s dominant carrier, offering more than 105,000 available seats this month, according to Cirium Diio Mi data. Southwest was second, offering more than 54,000 available seats.
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“We heard you, Hilo,” Adam Decaire, Southwest’s senior vice president of network planning and network operations control, said in a statement.
“Las Vegas is important to you, and you’re important to us..”
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This month, Southwest offered 146 flights between Las Vegas and Honolulu, totaling more than 25,000 available seats, according to data from Diio by Cirium. Southwest first began flights from the western U.S. to Hawaii in 2019. The airline currently flies to the Hawaiian islands from Las Vegas and Phoenix, and from California cities Sacramento, San Jose, Oakland, Los Angeles, Long Beach and San Diego.
Southwest does not operate direct flights to Hawaii from Dallas.
The Hawaii route expansion comes at a time when Southwest is weighing the possibility of building a more than 12,000-square-foot lounge at Daniel K. Inouye International Airport in Honolulu, according to documents previously viewed by The Dallas Morning News.
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HONOLULU (KHON2) — Spirits were high for the University of Hawaii Night outside of Honolulu Hale on Thursday, Dec. 18.
A special member of the UH football team was honored by the mayor. Even though it is called University of Hawaii Night, Honolulu Mayor Rick Blangiardi had one team in particular that he wanted to give praise to.
“We’re here tonight especially for the football team, given the great winning season they’ve had. But I really want to include the coaches in that, coaches never get enough credit,” Blangiardi said.
The star of the show was UH’s kicker, who is commonly known as the “Tokyo Toe,” who was honored with a proclamation that declared Dec. 18 as Kansei Matsuzawa Day.
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“Consensus all-American, first in the school’s history, all of this deserves celebration,” Blangiardi said. “Kickers have always been my favorite guys, but this guy here is off the charts. You got to give him credit where credit is due, you know?”
The all-American kicker stayed humble despite the accolades and said he could never have done it without the local community.
“Because of the coaches, because of my teammates, that’s the biggest reason why I am here right now, so I want to appreciate everybody supporting me throughout my journey,” Matsuzawa said.
Hawaii’s athletic director had some good news in terms of the Rainbow Warriors being televised in the islands for fans who prefer to watch the games at home.
“Pay per view is a thing of the past, we’re not going to have that any longer, I’m committed to that, and we’re certain about that,” UH athletics director Matt Elliott said. “We are in the process of working on what is the next phase of our media rights deal, so, waiting for the Mountain West to finish their job, which is to figure out the national rights and partners, and then we’ll turn our focus on the local rights.”
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Matsuzawa will take the field as a Warrior one last time against the University of California on Christmas Eve in the Sheraton Hawaii Bowl.
