How Honolulu can learn from Auckland

by Keli'i Akina, Ph.D., President / CEO, Grassroot Institute of Hawaii

It is often said that housing can be built in, up or out. In other words, by adding homes where some already exist, constructing taller buildings or developing untouched land.

The Grassroot Institute of Hawaii has long championed allowing more homebuilding in residential areas as a way to bring down housing costs throughout the islands.

As my Grassroot colleague Jonathan Helton noted in his 2023 policy brief “How to Facilitate More Homebuilding in Hawaii,” this approach is one of the easiest ways to boost the state’s housing stock — and at no cost to taxpayers.

One recent victory on this front is a state law enacted in 2024 that requires Hawaii’s counties to allow up to two accessory dwelling units per residential lot. But there are additional ways lawmakers could enable more homebuilding.

In Auckland, New Zealand, for example, officials in 2016 authorized up to three dwellings per lot in residential areas and taller apartment buildings in certain transit areas. Homebuilding there boomed as a result, and the city issued 112,000 permits for new dwellings in the six years after the sweeping reforms were enacted, increasing the housing stock by 20%.

Additionally, recently published findings from the Economic Research Organization at the University of Hawai‘i note that rental rates in Auckland for three-bedroom homes were as much as 35% lower after six years than what they probably would have been without the zoning changes.

Meanwhile, housing prices stayed relatively flat during that time period, even as home prices in neighboring cities increased by nearly 20%.

The author of the UHERO report, associate professor Stephen Bond-Smith, estimated that if similar zoning changes were made in Honolulu, within six years we could see approximately 9,700 new homes built and 5,000 aging single-family lots redeveloped into about 15,000 townhomes.

He also calculated that by 2032, renters could be saving up to $507 a month on two-bedroom units and as much as $1,129 a month on three-bedroom units, measured in today’s dollars.

And he pointed out that increased residential density would not harm existing property owners because land values typically increase when owners have more freedom to build.

But zoning changes alone will not solve Hawaii’s housing crisis. Hawaii’s various permitting processes also need fixing so new construction can happen more expeditiously.

Ultimately, we know from experience that zoning regulations and permitting problems have stifled housing growth in Hawaii. So it is important that our elected officials take the actions needed to help reverse that.

E hana kākou! (Let’s work together!)

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