Is Leasehold Housing Built on Government Land a Solution to Unaffordable Housing in Honolulu?
From UHERO, March 29, 2019
Housing is expensive on Oahu. For most middle-class Honolulu households, even buying a median-priced condominium ($415,000 in February 2019) is financially out of reach.
Some state lawmakers propose to remedy the situation by developing high-density leasehold condominiums on state-owned and city-owned land near rail transit stations on the Honolulu rapid transit system now under construction (State of Hawaii 2019 Legislature, S.B. 1 S.D. 2 and H.B. 820 H.D. 1 S.D. 1).
Prices of these condos would be capped at $300,000.
In this UHERO Brief, we point out that there are costs as well as benefits to leasehold vis-à-vis fee simple housing and note that the State (in 1967) and the City and County of Honolulu (in 2004) passed legislation designed to dismantle leasehold housing on private lands.
We also question how the State of Hawaii will be able to sell leasehold condos for just $300,000 when per unit construction costs are likely to exceed $400,000.
PDF: UHERO BRIEF
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