2006 Housing Policy Study by SMS Research & Marketing Services, Inc.

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Table 12. 2006 Prices and Affordability by County, 2006 County Actual Price Affordable Price Affordability Ratio City & County of Honolulu $434,508 $311,783 .72 County of Maui $562,614 $296,773 .53 County of Hawaii $362,425 $250,128 .69 County of Kauai $543,661 $270,690 .50 State of Hawaii $448,932 $299,551 .67 Source: Prices from MLS, ratios calculated by SMS. Needed Units One impact of rapid price run -ups and lower affordability is an increase in the number of households with inadequate housing. Inadequate housing might be defined to include households affected by pent -up demand15, doubling up16, and homelessness". Between 2003 and 2006, despite decreasing intention to move in Hawaii, it appears that pent -up demand, doubling -up, and homelessness all went up. One method of dealing with those problems is to increase the number of affordable housing units available. The Hawaii Housing Model includes a procedure for developing estimates of "needed units" for each county and for the State as a whole. Needed units were calculated as the number of households that cannot obtain a housing unit in the current market. The 2006 estimates were based on the number of households that were doubled -up. The current estimate does not include those who are homeless18. Method and Definitions The estimate of needed housing units presented here was taken from the Hawaii Housing Model 2006. Inherent in that supply and demand housing model is an estimate of the number of units that would provide all potential buyers and renters with an appropriate housing unit. Over several years, that estimate is not a specific number of housing units, but rather the number of sales or rental agreements completed during the period. Some of those agreements will involve re -sales or rental contracts involving existing housing units, others will require that new units be produced in Hawaii. 15 Pent up demand: households with the desire to move to a new unit but unable to do so. The number of households who will be moving out of State to find affordable housing, and those who cannot buy because of soaring housing costs, have increased since 2003. 16 Doubling -up: multi - generational families or families living with unrelated individuals in one unit who would rather split up. The number of doubled -up households has increased since 2003. 17 The number of homeless persons and families has not been measured since 2003. Those who deliver services to homeless people in Hawaii expect that the new measures will show an increase in homelessness since 2003. 18 The Hawaii Homeless Point -in -Time Count, 2007 is currently under way. Results will be included in the Hawaii Housing Model in 2007. Hawaii Housing Policy Study, 2006 Page 25 © SMS, Inc. February, 2007