The True Cost Of Making A Mint From Housing
Aren鈥檛 we complicit when we sell at these exorbitant prices?
November 13, 2020 · 4 min read
About the Author
In 1979, my husband David, his sister, his mother and I pooled our monies hui-style to build a three-story walk-up in McCully on a little corner lot where Dave鈥檚 grandma had lived in a two-bedroom house.
I love the multi-generational place we created. It is energy efficient with solar panels and faces north for coolness. The first floor has five parking stalls, a laundry and a dark room. Dave and I own two units on the second floor, his mother and sister each own a unit on the third floor.
The whole thing cost $250,000 to build, and our mortgage was very reasonable. David and I paid $750 a month for our two-bedroom and rented out the one-bedroom for $450. His mother paid $750 for her two-bedroom and his sister rented out her one-bedroom for $450.
Now every so often we receive a postcard from a realtor looking to buy our apartment building. These postcards typically list other small apartment buildings in the vicinity that are for sale for a million or two.聽 Although we aren鈥檛 interested, I often wonder what the new owners of the other apartment buildings will eventually ask for in rent in the buildings they acquire.
I listen to friends who are thrilled that the house their parents bought in Aina Haina for $40,000 many decades ago recently sold for $1 million. I am still in shock that the little corner lot and three-bedroom home my parents bought in Niu Valley in 1956 for $20,000 鈥 and sold for $33,500 in 1967 鈥 went for $962,000 a couple of years ago.
The buyers razed the house and cut down a stately monkeypod. We heard neighbors held a memorial service for the tree, which was the reason my mother had wanted the lot in the first place. The huge house the buyers constructed there must have brought their total costs closer to $2 million.
As our median home and condominium prices continue to creep upwards, even during this pandemic, I can鈥檛 help but wonder how many families will be able to afford the sky-high mortgages on any of these high-priced properties?
Recently a woman arrived at our church late one night after choir rehearsal. She was homeless and I volunteered to take her to Pauoa Valley to look at a possible place to live. The landlady had divided the concrete space next to her garage into three narrow rooms. In the common area was a locker system labeled A, B and C for each tenant鈥檚 plates, pots and utensils.
The landlady was charging $500 for each room. Since the woman didn’t have any money on her, I let her sleep in our downstairs laundry area that night. She stayed for four months.
When I finally insisted she find a room elsewhere, 鈥渓ow鈥 rents were closer to $700 to $800 for a room in a home. There is a warning on Craigslist that if the price is under $500 and seems too good to be true, something is probably amiss.
There is a luxury high-rise in town that was built 40 years ago. It was beautiful, with spacious apartments. I was shocked to look at a unit there with the woman. The spacious living room had been divided into two rooms, the master bedroom similarly sliced; with one other bedroom, there were now FIVE rooms of unrelated folks, each paying $700.
This crowding together is happening all over Oahu, as few can easily cover exorbitant rents or mortgages. Some places are dangerous for women. In one place we looked at, a man was renting a second bedroom and made it known he expected sexual favors.
Some places are like dorms, with three to five tenants sharing one bathroom and each person entitled to a tiny part of a refrigerator. No visitors are allowed in many of these places.
My eyes were opened taking the woman all over Honolulu to find a decent, reasonable place to live. I realized how the extremely inflated prices of homes and condos have driven so many people to rent out rooms to strangers, to divide up their homes into smaller chunks.
One such home in Kalihi had five people living in four tiny rooms downstairs. No kitchen. One bathroom. A sink outside to wash dishes. The woman looked at a place where one of the bedrooms was occupied by a man and his five children!
Aren鈥檛 we complicit when we sell at these exorbitant prices? We must see how we each contribute to the housing crisis and the ever-growing number of people on the streets.
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