In a 2019 study on housing demand in Hawaii, the Department of Business, Economic Development and Tourism determined that we need at least another 25,000 housing units over the next 10 years to meet demand, and as many as 47,000.

The Hawaii Housing Finance and Development Corp. had SMS Research run the numbers, and after taking into account the existing shortage from previous years, it upped the urgency to 50,000 units over the next five years.

For a state that typically builds between 2,000 to 4,000 new units per year, 50,000 is a tall order. If we maintained the high end of that range, it would still take 12 to 13 years to reach 50,000 units.

That’s a long time to wait, and that’s assuming housing demand and general economic conditions don’t change, and the existing housing stock – much of which was built half a century ago – remains in functioning use.

This all sounds bad, and it is bad, but as out of reach as 50,000 new units in five years feels, it’s still an underestimation according to local economist Paul Brewbaker. 

“I assert that another 100,000 units are needed in addition to the 50,000 previously proposed,” Brewbaker said, citing a range of 150,000 to 180,000 new units needed statewide over the next 30 years.

“What DBEDT and SMS Research do is they accept the status quo. They stipulate three persons per unit, which is what it’s been for the last half century, and do their math accordingly. Here’s the problem with that: what we had for the last 50 years was a gigantic mistake,” he said.

Brewbaker, the principal of TZ Economics and former chief economist at Bank of Hawaii, notes that in 1920, there were 5.5 people per housing unit but by 1960 that number dropped to 3.3 people per house.

Today, it’s 2.9. 

“Assuming it’s going to stay the same for the next 50 years is the wrong assumption,” he said. “Given what we know about the changes in composition in society, I estimate that two persons per housing unit is more accurate than three.”

This number doesn’t come from nowhere. It’s the result of looking at successful housing models elsewhere in the world — particularly Vienna which has roughly 1 million housing units and nearly 2 million residents in less than a third of the land area of Oahu — as well as a rigorously researched understanding about the social dynamics that continue to change housing needs in Hawaii. 

“At the time of statehood, approximately 60% of households were married families with children. Now it’s not even 25%. In 1960, 12% of households were individuals living alone, and today that’s 25%,” Brewbaker said. “So today there are as many households comprising persons who live alone as there are households of families with children. That’s a big change. You need a different kind of housing stock when there’s twice as much independent living.”

Much of the increase in independent living can be attributed to seniors living in their own houses during their sunset years, and the post-statehood increase of women in the labor force, which has provided more economic opportunities, higher incomes and greater freedom for women to live on their own.

These social trends, as well as Hawaii’s steady population growth since World War II – despite the population decline over the last five years – illuminate the core of our housing problem, much more so than oft-cited factors like out-of-state buyers. There are simply more people living in Hawaii, and the broad needs of society have changed in a way that would have required more housing even if the population hadn’t nearly doubled in the last 50 years. 

While those changes in demand grew, Hawaii’s supply got throttled. From 1960 to 1975, Hawaii was consistently developing 6,000 to 12,000 new units every year, but since 1975, there hasn’t been a single year that broke 6,000. 

This is a sobering analysis. Not only does 150,000 additional units seem impossible at our current rate of development, much of our public discourse and legislative efforts have focused on trying to restrain housing demand. Brewbaker takes issue with this approach. 

“It’s Trumpism. It’s tribalism. It’s bigotry. It’s xenophobia. We had to make laws against housing discrimination because white communities were not allowing Black homebuyers into their communities. Know why? Literally because they ‘changed the character of the neighborhood.’ People want to outlaw investors, but if you buy a house you ARE an investor,” he said.

“You can’t discriminate based on residency. You don’t get to tell other people what to do with their house,” Brewbaker said.

But even if you have no ethical qualms about discriminating against certain types of buyers, the plan to clamp down on demand also suffers from the fatal flaw that it just won’t work. A solution only works when it addresses the problem. It sounds simple, but if the problem is not enough housing, the solution is to build more.

“Demand side throttling or prohibition is just a reflection of the ignorance of the people advocating it. Anyone wealthy enough to move to Hawaii isn’t constrained by the shortage of housing,” Brewbaker said.

“Going after demand misses the point. It’s not about who owns the house and how they use it. It’s about the supply. We don’t build enough in Hawaii. And most of what we see that’s problematic about our society is an extension of the housing problem,” he said.

For a lot of local people, this is a tough pill to swallow. The word “development” is associated with bulldozing nature and demolishing sacred sites – replacing culture with commerce and paving paradise to put up parking lots (or affordable housing complexes). I’m sympathetic to development aversion: even a cursory understanding of Hawaii’s history makes it clear that development and displacement have gone hand-in-hand, often benefitting certain groups while excluding others. 

But by refusing to increase density in already developed areas, we’re making both of those problems worse. If we don’t build up, then the only option is to build out, pushing the boundary of human activity deeper into whatever nature is left. If we want to keep the country country, we have to make the city more city. 

Or, we can continue to do what we do now and leave tens of thousands of people in precarity and instability, which has the knock-on effect of pushing Hawaiians and other local people to leave. The people suffering the most under this system are the very people that those who oppose development claim they want to help.

“My provocation is to build 8,000 units (per year) first, and then let’s have a conversation about whether we restrict the units after that,” Brewbaker said. “We could have built more houses, and we should be building more houses. Tomorrow, not after talking about it for another 20 years. What if we built too much housing, how bad would that be? What would be the catastrophe?”