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The Honolulu Advertiser
Posted on: Monday, March 3, 2003

Affordable rentals grow rare statewide

 •  Kaua'i home shortage growing into crisis

By Jan TenBruggencate
Advertiser Staff Writer

Housing and real estate officials across the state say the rental housing market is as tight as they've ever seen it, especially on Kaua'i and O'ahu.

Low mortgage rates are fueling home buying, which is taking rental units off the market.

"We've been doing this for 22 years, and this is the worst we've seen," said Mike Stott of Stott Real Estate on O'ahu. "Of the 242 rental properties we handle, we have two available today."

Many lower-income families get assistance through the federal Department of Housing and Urban Development's Section 8 rental housing program, which is administered here through county housing agencies. Section 8 clients get vouchers to help pay rent.

Hawai'i County housing administrator Ed Taira said Section 8 tenants on the Big Island are having a harder time finding units. A stronger local economy has boosted home sales, particularly in East Hawai'i, he said.

"It's getting tighter. ... We've been experiencing it for several years, but it's getting worse."

Taira said West Hawai'i has a cyclical rental housing crunch: When tourism is good, owners take homes out of long-term rentals for the higher-profit vacation rental market. When tourism drops off, the houses are once again made available for rental.

Gary Iwai, City and County of Honolulu community assistance administrator, said his office is seeing a trend toward less low-cost rental housing available, and rising prices.

"We have noticed that Section 8 applicants appear to be taking longer to find a place. There may be an increasing number that, even within the 120-day time limit, can't find a place," Iwai said. "It wasn't too long ago — a couple or three years ago — that the reverse was true. There were ample units available."

"We have the flexibility to go up to 110 percent of the standard payment limit, and we have instituted that," he said, in an effort to house more families as prices rise.

Stott said rental prices clearly are on the rise.

"On O'ahu, the prices have gone up 5 to 8 percent in each of the last two years. A two-bedroom, two-bath apartment unit that used to rent for $950 to $1,100 is now going for $1,300 to $1,450," he said.

A Maui official said things are not as bad for lower-income clients on the Valley Isle.

"Our crunch was really about a year ago — there was hardly anything," said Milton Ito, housing director for the County of Maui.

The fallout from the Sept. 11 terrorist attacks "freed up a lot of units for our program. Families are able to get units now," he said.