NHSC Housing

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The cost and availability of housing are problems encountered by all U.S. citizens today. The first part of this chapter examines statewide data on housing in Hawaii. It also compares specific housing characteristics and costs for the major ethnic groups in Hawaii. Since some unique features in the housing situation for native Hawaiians have resulted from the Hawaiian Home Lands program, this chapter will also look at these in detail.

A word about some of the data used in this chapter is necessary. All of the 1980.housing statistics for different ethnic groups in the following section were obtained from a special tabulation of the 1980 Census of the Population that the U.S. Bureau of the Census performed for the Native Hawaiians Study Commission. Sources for other data are noted in the text. 1/



The State of Hawaii reported that in 1981 there were 343,000 housing units in Hawaii. This compares with 217,000 units in 1970. There were also 80,000 condominium units at the end of 1980 and 26,000 military and public housing units. 2/

The physical limitations of an island community will, of course, have an impact on the overall availability of housing. The high population density in Hawaii, particularly on Oahu, is also a factor. In 1980, there were 163.8 people per square mile of land area in Hawaii. This density is comparable to that in California (151.4) and about two and one-half times the population density for the United States as a whole (64). 3/ The de facto population density on the island of Oahu, however, was 1,386.8 per square mile. 4/

The State reports that housing has been in relatively short supply throughout the decade of the 1970's. 5/ Table 48 shows that the 1980 homeowner vacancy rate for Hawaii was 1.4, compared to 1.8 for the United States as a whole. The rental vacancy rates were 10.3 for Hawaii and 7.1 for the United States. 6/ (All tables are at the end of the chapter.)


The cost of housing is high in Hawaii compared to that in the United States as a whole. The median value of a house in Hawaii is two and one-half times greater than the national median value. (See Table 49.) Per capita income for all persons in the United States and in Hawaii, while Hawaii is higher, are not much different. In 1980, the personal income, per capita, was $10,101 in Hawaii and $9,521 for the United States as a whole. 7/

Data from the 1980 Census allow comparisons of the median value of owner-occupied housing units (non-condominium) in Hawaii for the major ethnic groups. (See Table 50.) The native Hawaiian group of owners has the lowest median value of all groups ($92,800), while the greatest values were reported by the Chinese ($137,900) and White ($134,500) groups.

Median rents paid in Hawaii and in the United States as a whole also differed considerably. Table 51 compares the median contract rents paid in 1970 and 1980 in the United States and in Hawaii. It shows that


the median contract rent in Hawaii was $271 in 1980, compared to $198 for the United states. Table 52 shows that in Hawaii, the median contract rent for native Hawaiians was $254, compared to $207 for Filipinos, $326 for Whites, and $271 for the all races group.


One result of the high cost of housing in Hawaii is that more people rent. A comparison with total U.S. data shows that 59.7 percent of housing units were owner-occupied for the United States as a whole in 1980, compared to 45.8 percent for Hawaii. On the other hand, 42.8 percent of the housing units in Hawaii were occupied by renters in 1980, compared to only 33 percent in the United States as a whole. 8/

U.S. Census data for 1980 also allow the comparison of owners versus renters by household for Hawaii's ethnic groups. (See Table 53.) The great variation among ethnic groups is striking. Over two-thirds of Chinese and Japanese households are owner-occupied. Filipinos and native Hawaiians are split almost equally between owners and renters, close to the "all races" group average. In the White group, only 43 percent of the households are owner-occupied, which is nine percent less than the "all races" group average.

The Native Hawaiians Study Commission received housing data specifically for native Hawaiians from several Alu Like Island Centers in January 1982. The information on ownership and renting indicates that on the island of Hawaii, 58 percent of the native Hawaiians own homes, while 42 percent rent or lease. Comparable figures for other islands are: Kauai--38 percent own, 62 percent rent; Molokai--73 percent own, 27 percent rent; and Lanai--38 percent own and 62 percent rent. 9/ The data for Hawaii and Molokai indicate a ratio of ownership to rentals close t (or better than, in the case of Molokai) the U.S. average. This probably indicates that the relative cost of owning a home is lower than the State average in the areas where native Hawaiians live.

Other Housing Characteristics

The Bureau of the Census collects other information on specific housing characteristics. Data from the 1980 Census for Hawaii obtained by the Commission allows comparison across ethnic groups of the median number of persons per housing unit, the median number of rooms per unit, and the existence of plumbing facilities. (See Table 54.)

The median number of rooms per unit in Hawaii does not differ greatly among the ethnic groups, particularly for owner-occupied units. There is greater variation among groups when one compares the median number of persons living in each housing unit. Native Hawaiians and Filipinos both have more persons per room (3.53 and 3.95, respectively) than the other groups and the "all races" average (2.82).

Another indicator that is often used to determine type and quality of housing is the extent to which plumbing facilities are available. Table 55 shows these figures for Hawaii's ethnic groups. Although all groups show a very high percentage of complete plumbing facilities for the exclusive use of a single household, the incidence of complete facilities in single-family Filipino domiciles is lower than the others. The incidence of complete facilities in native Hawaiian domiciles is slightly lower than that for other groups (except the Filipino group), and native Hawaiian and Filipino households have similar incidences of partial plumbing facilities.




The Hawaiian Homes Commission Act of 1920 was enacted by the U.S. Congress to "rehabilitate" native Hawaiians through a government sponsored homesteading program.*/ For the purposes of the Hawaiian Homes Commission Act, "native Hawaiians" are defined as descendants of not less than one-half-part blood of races that inhabited the Hawaiian Islands prior to 1778. This definition is in contrast to that appearing in Public Law 96-565, which created the Native Hawaiians Study Commission: "any individual whose ancestors were natives of the area which consisted of the Hawaiian Islands prior to 1778." 10/

The program was originally intended to encourage native Hawaiians to "return to the soil" and take up farming and ranching. This goal has never been fully achieved, however. An amendment to the Act in 1923 allowed residential lots of one-half acre or more with a loan limit of $1,000 for the construction of a house. The demand for residential lots has far exceeded the demand for agricultural and pastoral lots ever since.

The Department of Hawaiian Home Lands (DHHL), which is an executive department of the State of Hawaii, administers the Act. The Department derives its funds from seven revolving funds and eight special funds established in the State treasury. They are used to support operating expenses, loan capitalization, and construction projects.

*/ For a complete review of the homestead program, see Part II, chapter entitled "Review of Hawaiian Homes Commission Programs."

Present Demand

Homestead leases are awarded for residential, agricultural, and ranching uses. However, the vast majority of applications are for residential lots.

There are presently over 7,000 applicants of 50 percent or greater native Hawaiian blood quantum on the waiting list for homesteads. Of these, 6,360, or 87 percent, are waiting for residential lots on the island of Oahu. 11/ Given the current high interest rates and housing costs in the private sector, the Chairman of the Hawaiian Homes Commission expects this demand to "increase dramatically." 12/

DHHL Residential Program

Service Area

There are now approximately 2,700 homestead homes in the DHHL residential program, located on about one percent of the total acreage controlled by the DHHL as homestead land. 13/ The Department estimates that it services some 3,000 families, or a population of 18,000. Table 56 summarizes the homestead lease data by island.

Homes Constructed

Approximately 1,305 new homes have been constructed for homesteaders since 1976. This is an average of 2 00 homes per year, compared to an annual average of less than 25 during the period from 1950 to 1975. 14/ In 1982, 230 additional homes were scheduled to be constructed on Oahu. The tentative goal of DHHL is to develop an additional 710 residential lots by 1987. 15/

The emphasis in the residential program has been placed or the subdivision concept, under which single family residences are built on all of the islands. The sizes of


individual residential lots range from 7,500 square feet on Oahu to one acre on Molokai. 16/

Cost and Program Financing

The greatest problem encountered by the DHHL in its residential program is lack of funds. The DHHL estimates that it costs about $75,000 to place a native Hawaiian family on a residential homestead. The State of Hawaii, through the DHHL, provides the site development and design for residential lots at no cost to the homesteader. These infrastructure improvements include roads, sewers, water, electrical lines, streetlights, and sidewalks. These site improvements cost about $35,000 per unit, and constructing a house costs another $40,000. Here again, the State bears the cost of financing low interest loans or guaranteed loans. 17/ DHHL estimates that it will require $477 million to satisfy the present residential waiting list of 6,360 homestead applicants. 18/ The approximate cost of a home constructed on homestead lands is considerably less than the average cost of home construction in Hawaii in general. Because interest rates are low, the monthly payments by homesteaders are also lower than for others in the State. However, these facts do not take into account the quality of homestead housing. Many homesteaders complain about substandard quality.

Since 1975, the State of Hawaii has provided the homesteading program over $40 million in general obligation bond monies for offsite improvements and loan capitalization. However, this infusion of State funds is not likely to continue because the State Constitution limits its authority to incur debt.


The DHHL is authorized to make loans from any revolving loan fund to lessees for the following purposes:

(1) The repair, maintenance, purchase, or erection of dwellings on Hawaiian home lands, and the undertaking of other permanent improvements thereon;
(2) The purchase of livestock, swine, poultry, fowl, and farm equipment; and
(3) Otherwise assisting in the development of tracts, farm and ranch operations;
(4) The cost of:
(a) Breaking up, planting and cultivating land, and harvesting crops;
(b) Purchase of seeds, fertilizers, feeds, insecticides medicines and chemicals for disease and pest control for animals and crops, and related supplies required for farm and ranch operations;
(c) The erection of fences and other permanent improvements for farm or ranch purposes;
(d) The expense of marketing; and
(5) To assist lessees in the operation or erection of theaters, garages, service stations, markets, stores, and other mercantile establishments, all of which shall be owned by lessees of the department or by organizations formed andcontrolled by said lessees. 19/

Homesteaders are usually unable to secure loans from traditional lending institutions because they lack the usual collateral required for such Loans. The reason for this is that they cannot mortgage the lands they lease. Consequently, the DHHL attempts to fill in the gap by offering low interest loans. For residential lots, loans are made for two purposes: to construct new homes, and to replace old and dilapidated homes. Since 1975, the State of Hawaii has allotted $14 million for loans for these types. 20/

The DHHL also assists homesteaders in arranging other financing. It provides guarantees to assist homesteaders in securing loans from other lending sources such as the Farmer's Home Administration and the (State) Hawaii Housing Authority. The Farmer's Home Administration, through its Section 502 Program, had provided loans in excess of $6 million over several years prior to 1981. 21/

At present, the Department has approximately 1,700 outstanding direct loans totalling about $28 million. It has also guaranteed approximately 650 loans totalling over $12 million to date. Table 57 summarizes the financing for houses constructed with or without DHHL support during 1980-81.

Because they are lessees and not owners, homesteaders also have difficulty in obtaining conventional loans for home repair and improvements. However, DHHL also responds to this need. Table 58 shows the DHHL home repairs program funding for 19B0-1981. DHHL financed 20 home repairs and improvements (16 percent of the total) at a cost of $153,000 (26 percent). Lessees personally financed 106 home repairs and improvements (84 percent) at a cost of $445,000 (74 percent).

The 230 homes that the DHHL will construct on Oahu during 1982 will be financed by loans from the State of Hawaii ($7.7 million for 190 loans) and the Farmer's Home Administration ($1.6 million for 40 loans). Interest rates for these loans will range from 8 and 3/4 to 13 percent. 22/

Federal Housing Programs

"Native Hawaiians," as defined in Title III of the Public Law (96-565) setting up the Native Hawaiians Study Commission, are eligible to benefit from the U.S. Department of Housing and Urban Development (HUD) programs in the same fashion and no differently from any other U.S. citizen. However, there are impediments to the use of HUD programs for "Native Hawaiians" on Hawaiian Home Lands.

The HUD San Francisco Regional Office of Program Planning and Evaluation wrote a working paper that discusses these impediments. In summary, it states that:

Up to the present time, the Hawaiian Homes Commission has not participated in the various HUD housing and community development programs, nor have individual native Hawaiians been able to qualify for insured loans under HUD's single-family insured programs if their potential home was to be located on Hawaiian Home Land.
According to HUD's Honolulu Area Office, there are a number of problems which seem to inhibit HUD's program delivery to native Hawaiians seeking to establish residential homesteads on the Hawaiian Home Lands. These problems result from HUD program and statutory regulations which are in apparent conflict with the Hawaiian Homes Commission Act legislation. They may be categorized as follows:
  • Civil Rights Act and HUD Equal

Opportunity Regulations, which conflict with Hawaiian Homes

Act eligibility requirements and are inappropriate for application in the State of Hawaii;
  • FHA Single Family Insured Program Regulations on marketability and transfer of leasehold interest conflict with HHCA regulations restricting marketability and transfer of leasehold to native Hawaiians exclusively;
  • PHA Administered Multifamily Programs regulations require an administrative agency such as a Public Housing Authority (PHA) to be present before multifamily programs can be implemented, and HHC Act is unclear regarding multi-unit development. 23/

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1/ A couple of words of caution are necessary about the data used in this chapter. First, as noted in the chapter on "Demographics," the Census data for 1980 included both part- Hawaiians and full-Hawaiians in the category "Hawaiian" and because of the data collection system, the number of native Hawaiians in this category is lower than the number in the State of Hawaii population data. Second, the unique homesteading program for native Hawaiians of 50 percent blood quantum and the housing programs of the DHHL may affect the statistics presented here. According to comments received from tee Chairman of the Hawaii Department of Hawaiian Home Lands (DHHL):

Another factor which affects the Housing situation for Hawaiians is the existence of DHHL's housing program. There are about 2,900 leases with residences. Assuming an average household size of 5.0 persons, this amounts to 14,500 persons residing on Hawaiian Home Lands or 8.2% of the total native Hawaiian and Hawaiian population of 175,000 [according to the State of Hawaii population data]. This will affect statistics on Hawaiians cited in the [Commission's] report, for example, number and value of owner-occupied housing units and housing characteristics. If you deduct the number of DHHL-developed residences from these statistics, you will find that the housing situation for Hawaiians is more critical (pp. 1-2).

2/ State of Hawaii, Data Book 1981, A statistical Abstract (Honolulu: State Department of Planning and Economic Development, November 1981), p. 473.

3/ Data for California and U.S. from U.S. Department of Commerce, Bureau of the Census, Statistical Abstract of the United States: 1981 (Washington, D. C.: U.S. Government Printing Office, 1981) p. 11. Data for Hawaii from Hawaii Data Book 1981, p. 17. Hawaii data suggested in comments received from Hawaii Dept. of Social Services and Housing.

4/ Data Book 1981, p. 17.

5/ Data Book 1981, p. 4 7 J.

6/ Comments received from Robert C. Schmitt point out that the rental vacancy rate shown for Hawaii in Table 48, "is very misleading, since all vacant rental units held for transient occupancy are included in the rate" (p. 2). Including "tourist-type," shared ownership or time-sharing condominiums in the vacancy rate "make rental vacancies appear higher and at prices generally above comparable long-term rental units." (Comment from Hawaii Dept. of Social Services and Housing.)

7/ Statistical Abstract of the United States: 1981, p. 429.

8/ Ibid., p. 762. These data may be misleading; see footnote 6 above.

9/ Testimony submitted to the Native Hawaiians Study Commission by: Rachel Kamekana (Molokai, January 10, 1982); Winifred Takoma Hualani Lum (Hawaii, January 12, 1982); Nathan Kahikolu Kalama (Kauai, January 13, 1982).


10/ For an explanation of the definition of "native Hawaiian" in P.L. 96-565, see above, pp. 36-7.

11/ State of Hawaii, Annual Report, Department of Hawaiian Home Lands, 1980-1981, p. 10.

12/ Georgiana K. Padeken, Chairman, Hawaiian Homes Commission, Testimony prepared for the Native Hawaiians Study Commission (January 9, 1982), p. 15.

I3/ Ibid.

14/ Ibid.

15/ See Part II, of this report, chapter entitled, "Review of Hawaiian Homes Commission Programs," p. 389.

16/ Ibid.

17/ Padeken testimony, p. 15.

18/ Ibid., p. 16.

19/ Department of Hawaiian Home Lands, Title 10 Administrative Rules, Sec. 10-3-42 (effective July 30, 1981).

20/ Padeken testimony, p. 17.

21/ U.S. Department of Housing and Urban Development, Region IX, "Working Paper on Feasibility of Using HUD Programs on Hawaiian Homelands" (San Francisco: Office of Program Planning and Evaluation, June 1981), p. 5.

22/ Part II, chapter entitled "Review of Hawaiian Homes Commission Programs," p. 389.

23/ HUD "Working Paper," p. 2.