Transformative housing bills went nowhere this legislative session, but small wins keep hope alive

There is growing consensus that we need bold new approaches to address our lack of affordable housing, and the inhumane reality that thousands of Hawaiʻi residents currently live unsheltered. Our housing policy should better reflect the values of Hawaiʻi. That means everyone deserves to have safe and affordable housing, regardless of their life circumstances or income. While a growing number of lawmakers are adopting this stance, progress is slow and hard fought, and meanwhile the problem gets worse every year.

As the dust settles on Hawaiʻi’s 2025 legislative session, the results reflect a familiar pattern: incremental progress overshadowed by missed opportunities for transformative change. Hawaiʻi Appleseed pushed for an ambitious housing policy framework designed to address both immediate relief for vulnerable residents and systemic reforms to tackle the root causes of the state’s housing crisis. While meaningful bills did pass the legislative gauntlet, many of the most promising solutions—particularly those addressing speculative investment and tenant protections—were left on the cutting room floor despite overwhelming public support.

Modest Steps Forward

The session’s successes, while not revolutionary, represent important building blocks for future reform. Among the most significant was House Bill (HB) 1409, which expands the state’s ability to finance mixed-income rental housing near transit corridors. The bill also requires counties to formally designate transit-oriented development (TOD) zones. By aligning housing policy with infrastructure planning, this bill could help create more walkable communities and provide more affordable housing opportunities.

Another important victory came with HB422, which eliminates the construction cost component of school impact fees—a long-standing burden on housing development. These fees, often passed on to buyers and renters, have historically driven up housing costs without delivering promised school improvements. Their removal could meaningfully reduce development expenses.

For Hawaiʻi’s homeless population, HB431 provides critical support by expanding the Kauhale Initiative (which creates communal housing with services) and making the ʻOhana Zones program permanent. With $50 million in funding, these programs offer more than temporary shelter—they provide pathways to stability through critical wraparound services.

On the tenant protection front, Senate Bill (SB) 825 establishes a two-year eviction mediation pilot program that requires landlords to attempt mediation before filing for eviction due to nonpayment. Though limited in scope, this intervention could prevent unnecessary homelessness by creating space for negotiation. Similarly, SB322 takes aim at predatory real estate practices by prohibiting the bundling of foreclosed properties at auction—a win for community groups seeking to keep housing in local hands.

What Could Have Been

These victories feel bittersweet when contrasted with the session’s most glaring failures. Nowhere is this more apparent than the demise of HB739 and HB740, which would have created a voluntary locals-only housing market through deed restrictions. Modeled after successful programs in resort communities like Vail, Colorado, these bills offered a pragmatic solution to shield Hawaiʻi’s limited housing supply from speculative investors—a key driver of the state’s median $1 million home price. 

Less than a quarter of Hawaiʻi residents can afford that median price. Yet, despite support from businesses, nonprofits and government agencies, neither measure crossed the finish line.

Equally disappointing was the failure of HB1410, a carefully crafted conveyance tax reform bill that would have reduced costs for local homebuyers while increasing taxes on luxury and investment properties. After years of refinement, the bill didn’t even receive a Senate hearing—a stark reminder of how political inertia protects the status quo.

Tenant protections suffered similar setbacks, a longstanding pattern at the legislature. Bills to establish just-cause eviction standards (HB466), extend eviction notice periods (HB464), and seal eviction records (HB463) all stalled, leaving renters vulnerable to sudden displacement. Most heartbreaking was the death of HB1325, the “Right to Return” bill, which was passionately championed by the very residents the policy would protect. The bill would have protected tenants displaced by redevelopment projects—a critical safeguard as Hawaiʻi pursues density increases in urban areas. 

Perhaps the most systemic failure was the legislature’s inability to address Hawaiʻi’s “missing middle” housing crisis. The state’s affordable housing programs largely serve either very low-income residents (through Low-Income Housing Tax Credit projects) or those earning up to 140 percent Area Median Income (AMI). That leaves teachers, nurses, and civil servants, who usually don’t make enough to reach 140 percent AMI, stranded in the middle. HB432 sought to fill this gap by funding rentals for households earning 80-120 percent AMI. But like so many other bold solutions, it was shelved.

Pressing Ahead

Even the very modest gains Hawaiʻi made in addressing our housing crisis are at risk of being undermined by proposed federal budget cuts. Programs like Housing Choice Vouchers, Community Development Block Grants, and Native Hawaiian Housing Block Grants are facing the possibility of severe reductions—a devastating prospect for a state that relies on federal funding to build and preserve affordable units. 

The 2025 legislature’s $100 million investment into the rental housing revolving fund and $10.8 million investment for homeless services, while commendable, cannot compensate for the potential loss of these critical resources.

This session’s mixed results highlight the resilience of Hawaiʻi’s housing advocates—in particular the impacted community members who sacrificed valuable time and resources to participate in the legislative process through lobbying and testifying—as well as the entrenched barriers to meaningful reform that still exist within the legislature. The incremental progress on TOD, impact fees, and homelessness programs lays down important groundwork. But the repeated failure of bolder solutions suggests a need for new strategies. 

With federal cuts looming and home prices still climbing, the stakes have never been higher. One thing is clear: Hawaiʻi’s families can’t afford another session of half-measures.