“These formulas get to be so crazy that they get to be above market price,” said Kenna StormoGipson, an analyst with a Hawaiʻi Appleseed Center for Law and Economic Justice project called the Hawaiʻi Budget and Policy Center. “Their guidelines clearly need revamping.”
StormoGipson is referring largely to guidelines of the Hawaiʻi Housing Finance and Development Corp., a state agency that helps private developers produce affordable housing.
Similar formulas are also used by the city and the Hawaiʻi Community Development Authority, a state agency regulating development in Kakaʻako, where some of the priciest condominium towers on Oʻahu have been built.
Three factors—household income, family size and interest rates—are mainly used to compile annual housing affordability tables.
“These formulas are out of whack,” StormoGipson said. “They need to be revisited and they need to be redone.”