Can Honolulu County Build Affordable Housing? (spoiler alert - Yes!)

The Honolulu City Council is considering an Empty Homes Tax (EHT), to incentivize conversion of the island’s 34,253 “empty homes” into homes for local residents.  Based on Vancouver, Canada's experience with a similar tax, we can hope and expect up to 50% of empty home owners to convert their housing into homes for local residents.  That’s a great way to create thousands of new homes for local residents, without the costs and delays of planning, permitting and construction.  

But what about owners who want to keep their properties vacant?  Unless an exemption applies, they will pay an annual EHT (3% of assessed value).  The EHT revenues can provide a revenue stream to build many more affordable homes for our residents.

It's worth asking: Is Honolulu capable of effectively using new EHT revenues to fund construction of much needed affordable housing? The short answer is YES.  

Honolulu's long-term history with affordable housing is checkered, but recent trends from the City’s Affordable Housing Fund are very encouraging.  In recent years, the City has used property taxes allocated to the Affordable Housing Fund to fund numerous housing projects for construction or renovation of housing.  The resulting housing is restricted for residents making 60% of area median income or less, with perpetuity of affordability guaranteed for 60 years.  (This is in contrast to supposedly “affordable” housing projects by private developers who target 140% area median income, and have much shorter duration of “affordability”). 

The County is not itself a developer or builder, but instead supports affordable housing construction primarily through land acquisition for new projects and funding for renovation of current units.  We believe with sufficient staffing and resources, the County will be able to ramp up to provide more urgently needed housing.  The EHT can provide a vital dedicated revenue stream for affordable housing and allow the County to increase staff and scale up for more affordable housing programs.

We're trying to get the word out about the EHT.  Please share the EHT with your connections.  We are doing educational programs about the EHT to groups.  We want everyone to know about this proposal.  Let us know who we should talk to.

Here are some projects Honolulu County has partnered with in the past several years:

Project	Description	Units	Status
Halewiliko Highlands - Aiea	Senior and veteran housing.  HHFDC financing	140	2025 opening
Halawa view II - Aiea	Transit oriented Development (TOD) 18 story highrise	302	2025 opening
Hocking Hale - Honolulu	Family rentals	40	2024
Waialua Mill Camp - Waialua	affordable rentals	268	2027
Kailua Lofts - Kailua	affordable rentals	62	2027
Kūlana Nani Apartments - Kaneohe	For renovation of City apartments.	160	complete
Family Justice Center	Facility will provide coordinated services for victims of family violence	20	?
Ola Ka ‘Ilima / Artspace Lofts - Kakaako	To assist in developing low- to moderate-income housing.	84	complete
Hale Makana o Māʻili - Maili	Performance mortgage to assist in developing fifty-six low- to moderate-income housing units (LIHTC).	52	complete
Pūnāwai Building - Honolulu	Hygiene center, housing first, colocated with additional 20 units of medical respite and clinic	20	complete
NāLei Hulu Kūpuna, Phase I & II	Senior & Veteran housing	75	Complete
Pauahi Hale	For the installation of a new fire alarm system in a City facility that provides permanent rentals for housing first clients and individuals experiencing severe mental illness.	48	complete
Kahauiki Village Phase II	For infrastructure and construction for families and individuals experiencing homelessness.	114	complete
Maunakea Marketplace	For renovation and repurposing of thirty-eight 2nd floor units to create housing for families and individuals experiencing homelessness.	38	complete
Kewalo Street	For partial funding to complete funded Special Needs Housing purchase of 10 bedroom duplex leased to The Youth Collaborative, serving homeless youth.	10	complete
Hau‘ula Homes	Partial funding of three duplexes to add 15 dwelling units to the City’s Special Needs Housing Inventory. NOFA.  for leasing to occur once sale is complete	15	complete