Native Hawaiian family Pedro Makilan, a retired roofer whose mother was a full-blooded Hawaiian, and his wife, Laverne, who is three-fourths Hawaiian, have waited 27 years for a Hawaiian Home Lands parcel.
finally gets a home
they can call
their rent-to-own
A unique project in Kapolei
grants the Makilans their
dream after a 27-year waitBy Suzanne Tswei
stswei@starbulletin.comThe end is in sight. And the Makilans are getting more than what they could ever dream of: a three-bedroom, 2 1/2-bath home for $850 a month.
The Makilans are one of the 70 families who qualify to rent a single-family home in Kapolei Ho'olimalima, a pioneering rent-to-own housing project benefiting native Hawaiians. The project, a multiple award-winner in the Parade of Homes, was created by Mark Development on 38 acres of Hawaiian Home Lands.
Two weeks ago, the Makilans and their two grandsons moved into their new home, built on a 5,000-plus-square-foot lot. The home has carpet and vinyl flooring, solar heating, roofing with improved heat barrier, steel-frame construction, vinyl siding, upgraded electrical and plumbing systems, and other extra finishing touches.
Altogether, the new home has 1,360 square feet of living space plus a small front porch and a two-car garage, adding up to 1,820 square feet under roof. A generous yard, with newly planted grass and a fence, provides a safe playground for their rambunctious grandsons.
When: 10 a.m. to 5 p.m. tomorrow and Sunday. The New Parade of Homes 2001
Information: A guide to 22 properties, 19 on Oahu and three on Maui, will available at Bank of Hawaii, the Home Depot, Hardware Hawaii, Furnitureland / Z Interiors and Wayne's Flooring America; and on Maui at Bank of Hawaii, mortgage lenders, the Home Depot and Wayne's Carpet and Tile; and at the model sites.
The two-story home is by no means luxury housing, but it is roomy, comfy and attractive, the Makilans said. It is a big step up from the cramped two-bedroom apartment they rented for 13 years in Red Hill.
"After all those years of living in the concrete jungle, this is just beautiful. I can't believe how lucky we are," Laverne Makilan said.
The Makilans are counting their blessings even though they can't quite call the home their own. Not yet. They are renters for now, but after 15 years of renting, they will have the option to buy it for $52,440 and lease the land for $1 a year for 99 years.
Awards given to Kapolei Hoolimalima, Model C, at 91-1058 Kuipuakukui St., Village 6, Villages of Kapolei: Award winner
>> Governor's Award for Affordable Housing
>> U.S. Department of Housing and Urban Development National Homeownership Award
>> Energy Value Housing Award
>> Winner in Single-Family Detached Division I in the Parade of Homes
The Makilans qualified to be renters because their income is 60 percent or less of the median income. For example, for a family of four, income must be no more than $38,760. However, renters also must earn enough to be able to pay rent and qualify for mortgages after 15 years.
"This project is the first of its kind. It's a bold move forward in terms of affordable housing for Hawaiians on Hawaiian Home Lands," said Craig Watase, vice president of Mark Development.
Normally, individuals with 50 percent Hawaiian blood qualify to lease parcels from Hawaiian Home Lands, a state agency charged with rehabilitating Hawaiians by returning them to the land. However, because of the limited land available, applicants may spend their lives waiting their turn. Pedro Makilan's mother died without having received a parcel.
Hawaiians who are given parcels pay $1 a year to lease the land for 99 years. The lease may be renewed for 100 years and passed down to heirs. While the lease is a nominal amount, many Hawaiians are not able to meet the financial requirements for building homes on their parcels."We notice that there were many Hawaiians who are disqualified because they cannot afford to build their own homes. They can pay the $1 but not qualify for a mortgage. They don't make enough money, have bad credit or have no savings for down payments," Watase said.
That was the pattern that Mark Development officials noticed when they were developing a housing project in Nanakuli in 1995. The developer built 271 homes in the Princess Kahanu Estates, pricing them between $80,000 to $147,000. Many applied to purchase the affordable homes but could not meet the financial qualifications.
"Our rent-to-own project is helping this segment of the Hawaiian community who falls through the crack all the time. They just need some time to work on their financial qualifications. This project gives them 15 years to build up their credit and savings while they are renting," Watase said.
The developer received $9.1 million in federal low-income housing tax credit and formed a partnership with Verizon Capital, the investment branch of the telecommunications company Verizon, to develop the project. Verizon benefits by claiming the tax credit, which it buys from the developer. In turn, Verizon pays the developer 75 cents for each tax credit dollar, giving the developer the cash to build the project.
The rent goes toward expenses, such as insurance, upkeep and community association fees. The rent also is projected to buy down about 25 percent of the mortgage in the 15 years, helping to make ownership more affordable. Watase said the homes will be sold at cost, based on the amount remaining in the mortgage.
Estimated home prices range from $46,430 for a three-bedroom, two-bath home to $56,740 for a four-bedroom, three-bath home.
At the time of the home purchase, the renters also will be given the $1-a-year lease for the land through Hawaiian Home Lands.
Watase said there were more than 1,000 applications. About 700 families were pre-qualified, and the list was narrowed to 70. About 15 families have moved into their new homes in the last two weeks.
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