2011 Housing Planning Study - State of Hawaii

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About 40 percent of potential buyers said they Sixty-five percent of households that plan to rent would be looking for at least a two-bedroom unit their next unit indicated that they would like to and 29 percent said they would need at least purchase a home in the future. Their reasons for three bedrooms. The willingness to settle for not doing so now most often included the high fewer bedrooms was higher than in the past, cost of housing and insufficient funds for a down perhaps reflecting a willingness to compromise payment. These households reported their on unit size in the face of high prices. The same intention to buy a unit in an average of eight was true for the preferred number of bathrooms. years. Half of buyers conceded that they would be willing to accept a unit with only one or one-and- a-half bathrooms. QUALIFICATION FOR PURCHASE AND RENT When asked about the smallest size unit they HHPS 2011 includes a third measure of demand, would accept, nearly half of the would-be buyers qualified demand. Not everyone who plans to (46%) said they could live with 800 to 1,200 buy or rent a different unit (raw demand) within a square feet. An additional 16 percent said they given time period (final demand) in the State of could accept units between 1,200 and 1,500 Hawaii (effective demand) will be able to do so square feet. in the next few years. This third tier of demand evaluates those households that are financially able to make a move. Renter Preferences The Housing Demand Survey includes many Households that plan to rent their next home are items to measure the relative ability of potential predominantly current renters (87%). Among buyers or renters to purchase certain housing those who would rent their next unit statewide, products. Although no particular product is being 43 percent preferred to rent a single-family evaluated here, it is useful to review the house. About 47 percent preferred an apartment qualification factors to get an idea how they may or condo, and another five percent chose a affect purchasing capacity in the near future. townhouse. Preference for single-family homes was once again much higher on the Neighbor Islands than on Oahu, where renters were more Households That Plan to Buy interested in townhomes. To evaluate the financial readiness of those Across the State, renters first choice would be households wishing to purchase a housing unit larger units with two (43%) or three bedrooms in Hawaii, we examined their income, savings, (31%). Nearly all of the potential renters, and total amount available for a down payment. however, were willing to take units with fewer These elements were evaluated against a than three bedrooms, if necessary (83%). Again, median priced home assuming a fixed rate, 30- these figures suggest a willingness to accept year loan, a 5 percent interest rate, and a 20 smaller units than in the past. The number of percent down payment. The results are outlined bathrooms required was also relatively low, with in Tables 10a and 10b. 69 percent reporting that they could accept one or one-and-a-half baths. The story was essentially the same across all Counties...many households planning to About 41 percent of potential renters said they purchase their next home earn enough money to would need less than 1,000 square feet of space cover the monthly payments, but far fewer have in their next unit. An almost equal number of the ability to marshal sufficient funds for the renters reported a need for between 1,000 and down payment. Between 33 and 71 percent of 1,500 square feet (39%). prospective buyers could purchase a median price home and still dedicate less than 30 Hawaii Housing Planning Study,2011 Page 15 0 SMS, Inc. November,2011