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HB1492
HOUSE OF REPRESENTATIVES
H.B. NO.
1492
THIRTY-THIRD LEGISLATURE, 2025
STATE OF HAWAII
A BILL FOR AN ACT
relating
to affordable housing
.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
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SECTION 1.
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The
legislature finds that the United States Census has reported that nearly sixty
thousand Hawaii residents move away each year to more affordable states, and
more Native Hawaiians live on the mainland than in Hawaii, a continuing trend
that started in 2020.
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In addition,
approximately forty‑five per cent of Hawaii households struggle to pay
for basic daily needs and are one emergency away from severe financial hardship
or homelessness, according to Asset Limited, Income Constrained, Employed (ALICE)
Reports.
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Twenty-five per cent of
financially stressed households plan to leave Hawaii because they cannot make
ends meet, and forty per cent more are unsure if they can continue to live in
Hawaii.
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The legislature also finds that the cost of
housing is the largest expense driving Hawaii residents to move out of state.
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On average, residents pay forty per cent of
their income for housing costs, the nation's highest and well above the thirty
per cent affordability standard.
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The
average Hawaii worker can afford only $450,000 for a home, but the average market
sales price for a home in Hawaii is almost $1,000,000.
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Out-of-state buyers have contributed to this
trend of rising home sale prices, especially on Maui, where thirty-one per cent
of home sales went to nonresidents, though this is lower than the high of fifty
per cent in 2012.
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The legislature finds that wages of Hawaii
households averaged $95,000 in recent years, increasing from $93,300 to $98,317
since 2019, which generally equates to being able to afford a home priced
between $400,000 and $600,000, depending on mortgage rates.
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This means the average worker cannot afford a
single-family home on Oahu, Maui, or Kauai, because of the median $1,000,000
sales prices.
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Generally affordable units
are condominiums on Oahu and homes on Hawaii island, since their median sales
prices are about $500,000.
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The legislature recognizes that many ALICE
families temporarily manage their financial situation by using credit cards to
pay for necessities.
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However, credit
card debt builds up when unpaid, amounting to over $7,000 per resident of
Hawaii, which is among the highest in the nation.
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Some families sell their house to pay off
debts and then move to a smaller home.
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However,
because each house is usually sold to the highest bidder, that means one less
home that local residents can afford.
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Meanwhile,
houses that local residents cannot afford are bought by wealthy individuals who
often live in other states or countries.
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Therefore, the legislature finds that a
local housing market is necessary to provide affordable homes for Hawaii
residents.
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The legislature believes that
the Hawaii housing market should be bifurcated into two markets, one for
residents of the State and the other for national and international
buyers.
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The local housing market would
be established to use the principles of community land trusts to preserve
houses for residents of Hawaii in perpetuity.
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The legislature intends to develop a local
housing market through the coordination of a land trust program of existing and
new housing programs.
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To establish a
local housing market, a comprehensive action plan will be needed to promote,
facilitate, and coordinate land trusts and various incentives for their
development.
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Accordingly, the purpose of this Act is to
appropriate moneys to the department of business, economic development and
tourism to fund a comprehensive action plan to establish a local housing market
in Hawaii.
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SECTION 2.
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No later than twenty days prior to the convening of the regular session
of 2026, the department of business, economic development, and tourism shall
submit a comprehensive action plan to establish a local housing market in
Hawaii.
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The comprehensive action plan
shall include:
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(1)
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Definitions
and plans to develop condominium land trusts in transit-oriented developments,
master‑planned community land trusts, rent-to-own housing land trusts,
family inheritance land trusts, agricultural community land trusts, and
manufactured housing land trusts;
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(2)
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Incentives
to promote the development of land trusts and criteria for issuing awards,
including but not limited to land use and building exemptions, increased
density and height limits, tax credits and exemptions, and state-backed loan
guarantees;
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(3)
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Amendments
to inheritance statutes to authorize family land trusts that ensure
multi-generational inheritance and provide exemptions from estate taxes;
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(4)
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Statutory
amendments to authorize residential dwellings for agricultural workers in
agricultural community land trusts and manufactured houses in community land
trusts;
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(5)
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Analysis
of any constitutional and legal issues that allow land trust sales solely to
qualified state residents, and issues that may prohibit certain limitations on
sales to out-of-state buyers; and
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(6)
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Recommendations
for other statutory amendments, legislative acts, and appropriations.
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SECTION 3.
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There is appropriated out of the general revenues of the State of Hawaii
the sum of $300,000 or so much as may be necessary for fiscal year 2025-2026,
and the same sum or so much as may be necessary for fiscal year 2026-2027 for a
comprehensive action plan to establish a local housing market in Hawaii.
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The sums appropriated shall be expended by
the department of business, economic development and tourism for the purposes
of this Act.
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SECTION 4.
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This Act shall take effect on July 1, 2025.
INTRODUCED BY:
_____________________________
Report Title:
Affordable
Homes; Affordable Market; DBEDT; Appropriation
Description:
Requires
the Department of Business, Economic Development, and Tourism, to establish a comprehensive
action plan to establish a local housing market in Hawaii.
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Appropriates moneys.
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.