Wednesday, July 7, 1999

League says housing
bill will backfire

By Gordon Y.K. Pang


The League of Women Voters of Honolulu is warning the City Council that relaxing affordable housing requirements will make it less likely that lower-income families can purchase homes.

"We feel it would destroy the possibility of families, say of the 50 percent to 100 percent of median income, of ever being able to afford anything on the market," said Grace Furukawa, league president.

Developers at yesterday's Council Zoning Committee meeting disagree with Furukawa's contention, arguing that the housing market will open up to more families of every income category.

At issue is Bill 50, which would allow developers and others to sell homes and condominium units designated as "affordable housing" to all home buyers during a two-year period.

The state and the four counties in the 1980s began requiring that developers set aside portions of their units for low- and moderate-income people. Prices are based on median income levels. Currently, median income is about $58,000 for a family of four.

But developers say prospective buyers who qualify and want to purchase affordable housing already have done so, leaving a large, unsold inventory.

"With the sharp drop in market prices during the last 10 years, $75,000 families are able to afford market housing and affordable housing now with prices up to $200,000 or $225,000 and, of course, prefer it," Furukawa said.

"In the meantime, $40,000 and $50,000 incomes needing housing priced roughly from $120,000 to $150,000 are unable to find it," she said.

But Dan Davidson, executive director of the Land Use Research Foundation of Hawaii, said opening up affordable housing units won't attract wealthier home buyers, Davidson said, since owners "must still be owner-occupants and also because buyers tend to buy the most house that they can afford, not the least."

Representatives from Castle & Cooke, Schuler Homes and Gentry Homes also testified in support of the bill, which also would lower the mandatory buyback period from 10 years to three years.

Jan Sullivan, city planning director, said she agrees with Furukawa's assessment that current affordable housing conditions do not address the issue of housing for truly low-income families.

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