Dining out in Honolulu, at places like Roy's Restaurant in Waikiki, above, rose 5.7 percent in the first half of the year compared with last year, new statistics show.
City dwellers feeling the pinch
Federal statistics show that consumer prices are rising in Honolulu
STORY SUMMARY »
It cost more to rent an apartment, buy groceries and dine out in Honolulu in the first half of this year, though it cost less to buy clothes when compared with the same time last year.
Consumer prices for Honolulu went up 5 percent over last year, according to the U.S. Bureau of Labor Statistics, more than double the 2.4 percent gain for the entire nation.
Housing went up 7.7 percent overall, with rent jumping 9.6 percent. Take-home groceries, meanwhile, grew by 6.7 percent over last year, while the cost to fuel up a car edged up only 1.5 percent.
Honolulu Consumer Prices
Inflation in the first six months of 2007:
||Pct. change from first half of '06
||Pct. change from second half of '06
|| + 5.0%
|| + 7.7%
|| + 1.4%
| Food and beverages
|| + 5.9%
|| - 1.4%
|| - 2.0%
FULL STORY »
Consumer prices in Honolulu rose 5 percent in the first half of this year compared with last year, according to the latest U.S. Department of Labor statistics.
Though it is a slight dip from the record inflationary high of 5.8 percent recorded in the first half of 2006, it is more than double the rate for the entire nation, at 2.4 percent.
Rent, along with take-home groceries, registered the highest growth, at 9.6 percent and 6.7 percent, respectively. Overall, housing grew 7.7 percent over last year.
"While food and home rental prices have been going up nationally, in Honolulu they've been going up even higher," said Amar Mann, an economist with the Bureau of Labor Statistics. "Rent and groceries together make up more than half the index."
Nationally, the cost of rentals went up 4.2 percent year over year, while take-home groceries went up 4.6 percent, Mann said.
Eating at Honolulu restaurants went up 5.7 percent as proprietors passed on costs of doing business to the consumer. Food and beverage costs increased 5.9 percent.
Gas prices, on the other hand, remained more stable than national figures, registering only a 1.5 percent increase over the same period last year, and 1.1 percent more than six months ago. Transportation costs went up 1.4 percent over last year.
Recreation prices rose 1.1 percent while education and communication prices fell 1.2 percent. The cost of apparel fell 1.4 percent over the year.
Honolulu, however, lost its top ranking for price increases this year, dropping to No. 2 behind Tampa, Fla., which recorded a 5.2 percent increase in consumer prices. Seattle ranked third, with a 3.9 percent increase.
Mann said Tampa pulled ahead this year due mostly to a jump in medical costs.
The higher costs are bound to affect consumers ranging from young college graduates earning their first paychecks to senior citizens living on Social Security.
A few dozen postings on the Internet site Craigslist indicate there is a demand for one-bedroom rentals for less than $1,000 a month in the metropolitan Honolulu area.
But apartment listings for one-bedrooms are advertising for between $1,000 per month in Waikiki to $1,575 per month in Manoa.
Two-bedroom apartment landlords, on the other hand, are seeking $2,000 or more in the Honolulu area.
"It's really hard to find something you can afford in the good areas and decent places," said Joy McGee, who is looking for a two- or three-bedroom in the range of $1,500 to $2,000 a month.
McGee and her husband have been searching for the last month but are finding that the rentals being offered are too small or in less than ideal buildings.
The higher rentals are still a trickle-down effect of the booming real estate market two years ago, according to Hawaii Pacific University economics professor Leroy Laney, and will take a few years more to catch up.
"When you have a big run-up in housing prices like we had in the last several years, then it's really not surprising," Laney said. "It may have leveled out, but we're still seeing the effects of the previous increase."
Laney's current forecast for the state inflation rate for 2007 is 5 percent. The Labor Department's numbers, he said, were consistent with his expectations for this year.
The jump to 5.8 percent last year over the first half of 2005 was what caught many economists off guard, he said, and it was expected to come down this year but still remain higher than the rest of the nation.
The cost of food and beverages, groceries and eating out all went up in the 6 percent range over last year.
Some shoppers are getting sticker shock as their groceries are rung up at the supermarkets, which come out higher than what they saw a year ago.
Market analyst Marty Plotnick, who keeps tabs on all the grocery chains, said the higher costs will make bulk shopping more appealing. The higher cost of groceries appears to be across the board, however, and he expects it to continue for the rest of the year as well as into next year.
Plotnick has his own economic indicator: a jar of orange marmalade, which was a childhood treat. In the 1960s a jar of the marmalade at Holiday Mart (which evolved into Daiei and now Don Quijote) cost 60 cents. At Safeway today, he said, it will set you back $5.
Compared with the last of half of 2006, the increase in consumer prices went up only 2 percent.
At the same time, he said Honolulu residents would feel the impact when real, or inflation-adjusted, personal income does not keep pace with inflation.
"The inflationary impact is most severe on those people with fixed retirement incomes, including Social Security," Plotnick said.