A recent WalletHub study found that Hawaiʻi was the state with the lowest effective tax rate at 0.27 percent, but that isn’t helping when it comes to maintaining an affordable housing stock in the Aloha State. Most of the country is currently experiencing a mix of increasing home prices and decreasing inventory, especially for lower-income homebuyers. But now a new report examines how the affordability situation in Hawaiʻi is being exacerbated by the local short-term rental market.

According to a study released by a nonprofit advocacy group called the Hawaiʻi Appleseed Center for Law & Economic Justice, more than a quarter of the homes sold between 2008 and 2015 in Hawaiʻi were purchased by non-residents. Many of these homes are purchased in order to be put on the market as rental units for visiting tourists. Moreover, while there are inventory and affordability issues nationwide, the situation in Hawaiʻi is magnified by the fact that the island state’s housing costs are among the highest in the United States, and Hawaiʻi workers “earn the lowest wages in the nation after accounting for cost of living,” according to the report.

The report further explains that Hawaiʻi is building half as many homes as it needs to be to meet demand from local residents—and that figure drops to only one-third when focused on “units needed for low- and moderate-income households.” Approximately 43 percent of Hawaiʻi’s residents are renters, according to the report, which works out to the fourth-highest percentage in the nation.