Kauai: Out-of-state buyers drove up housing prices in 2021

January 3, 2022 GMT

LIHUE, Hawaii (AP) — An influx of out-of-state homebuyers and renters pushed up housing prices on the Hawaiian island of Kauai last year, officials said.

“Anecdotally, (they) appear to have significantly driven up home prices and rents, exacerbating an already-critical housing shortage,” Adam Roversi, the director of the county’s housing agency, told The Garden Island newspaper.

The median sale price of a single-family Kauai home jumped 57% in November from the same month in 2020 to $1.2 million, according to real estate firm Locations. Statewide, the median climbed 16%.

Kauai County Councilmember Luke Evslin agreed the influx of wealthy individuals looking to work remotely from new homes stands out as a key development in the housing crisis.


“If you’re working for Google, then you can afford to outbid anybody working on Kauai, for the most part,” Evslin said.

Higher home prices and rents have intensified the island’s labor shortage, said Nalani Brun, the director of the county’s Office of Economic Development.

She said many workers in the hospitality industry are from off-island, often recent high school or college graduates, seeking sun and adventure. They often share homes and pool resources to pay rent. But fewer of these homes are available, and those that remain have become unaffordable to low-income workers.

To help address the housing shortage, Evslin and Councilmember Bernard Carvahlo introduced a bill aimed at preventing developers from creating housing rules that stop homeowners from renting out privately owned space.

Evslin has also set his sights on vacant homes and short-term vacation rentals, arguing wealthy people from outside Kauai have “parked” money in local houses to take advantage of low property taxes.

He estimated one in eight Kauai homes sits vacant, having been purchased as an investment or second home.

“We need to discourage that through property taxes,” he said. “If you’re going to keep a house empty, then you should be paying a whole lot more for that, to ensure that we can build a house for somebody else.”

The county has already changed zoning requirements and created a cesspool conversion program to boost housing development.

Almost half of the island’s 40,000 homes have cesspools, according to Evslin. A reliance on cesspools prevents Kauai homeowners from building additional affordable rental units on their properties.