ÌìÃÀÊÓƵ

Housing costs have been and continue to remain a controversial subject on the island of Oahu. According to Zillow, data as of August 31 of this year indicate the median price of a house in the Honolulu area is $638,200. Zillow also predicts a 3.4 percent increase in the coming year.

According to Rent Jungle, as of this September, a one-bedroom apartment in Honolulu rents for $1,759 a month on average, and a two-bedroom apartment rents for an average of $2,840. If we maintain a rule of thumb for a household budget and follow the guideline of 30 percent of one’s gross income being devoted to housing, the minimum base income is over $63,000 just for the one-bedroom apartment.

Housing prices in numerous North American metropolitan areas are keeping people out of the market as investment properties are making home buying unaffordable to the mainstream buyer. Some say out-of-town investors and corporate leasing companies are contributors to the ever escalating price increase to the potential homeowner. This impacts not only home prices but rentals as well.

According to the U.S. Census Bureau Housing Vacancy Survey (HVS), 30 percent of Manhattan units remain vacant for 10 months out of the year. The HVS provides current information to many other agencies and businesses as well as being a component of the index of leading economic indicators. This is where the Department of Defense (DOD) acquires its data in establishing cost of living allowances and other means of supplementing DOD employee’s income to compensate for market conditions.

The obvious implication is, when Honolulu prices go up, so do the supplements.

In 1979, the City of Santa Monica and its voters elected to amend the city’s charter and institute rent control. This was a radical step to deal with the problem of ever increasing rents in a popular area of the Los Angeles basin.

We are spending taxpayer funds to build shelters to house people who cannot afford market housing. This still does not address the root cause of the problem.

The Canadian province of British Columbia recently enacted legislation that tacks on an additional 15 percent of the purchase price to those whose residency lies outside of Canada. So how has this worked? Housing prices have dropped in Vancouver over 20 percent in under one month. The Chinese consul general in Vancouver, Liu Fei, gave a press conference where she vigorously denounced the new law.

Essentially, the tax stopped the money laundering by Chinese investors who have been buying up local real estate to protect themselves from the Chinese currency devaluation.

Many characterized the Santa Monica measure as socialism gone wild. It was aimed at those elements who were making obscene profits at the expense of those who could not afford continuing increases to their rents.

In the mean time, we are spending taxpayer funds to build shelters to house people who cannot afford market housing. This still does not address the root cause of the problem. Relying on the better ethics of property owners is unacceptable. Waiting for market forces to control prices is not fixing the problem.

There are many factors that need to be explored. Commercial interests don’t seem to be too concerned; reform would potentially spoil their margin of profit. Government is responsible for ensuring an even playing field. So who is going to have the political chutzpah to take a stand and drive an initiative to at least look at promising alternatives?