The Honolulu Housing Strategy That Isn’t Working

Ian Kealoha is the type of homeowner the city likes to see. Looking to offset his mortgage, he decided to build a rental unit on his lot in Wahiawā. But it took him more than four years to get a permit and finish construction.

Accessory dwelling units – as independent living structures erected on residential properties are known – have been touted as a way to help ease an escalating housing crisis on Hawaiʻi’s most populous island by increasing density.

To encourage the practice, state legislators last year passed a law requiring Honolulu and other counties to allow people to build two of them. Meanwhile, the city is struggling to persuade people to build just one.

A city plan from 2014 estimated between 17,000 and 22,000 rental units could eventually be built, with at least 250 built annually in initial years after a law passed allowing them.

Meanwhile, 1,320 ADUs have actually been built since then, Honolulu Department of Planning and Permitting spokesperson Davis Pitner said, averaging a little more than half of the yearly goal.

DPP Director Dawn Takeuchi Apuna put it bluntly in an April interview: “Not really a super successful program.”

The reasons vary: Sewer capacity might be lacking, yards might be too small, property owners might not want to deal with a notoriously slow permitting system and the general headaches and costs construction entails.

While ADUs are only part of the city’s housing strategy, the slow pace of construction illustrates the complexities standing between residents and having enough truly affordable homes.

Homeowners can build ADUs — essentially ʻohana units that aren’t restricted to family members — on the same lot as their larger primary house. The units have smaller footprints and can be rented out, making them attractive to policymakers who want to add housing stock beyond approving expensive condominiums.

But city officials stress that ADUs weren’t meant to be a silver bullet.

Pros and Cons

“I’m certainly not going to pretend that this is solving the problem,” City Council member Tyler Dos Santos-Tam said last week. He said ADU construction is an important part of an “all of the above” strategy of boosting the supply of housing that includes ensuring affordable units in Kakaʻako high-rises, building single-family homes in Kapolei and rentals in Makiki Heights.

Arjuna Heim, director of housing policy at the Hawaiʻi Appleseed Center for Law and Economic Justice, said ADUs could be a good option for people looking to downsize by moving into the ADU themselves while maintaining ownership of their houses, which they can then rent out.

She said one advantage from a policy perspective is that the additional units don’t require public approval through City Council or neighborhood board hearings, which sometimes doom housing proposals.

“If I’m trying to build an ADU,” she said, “it’s just me and DPP.”

Still, the personal nature of somebody building an ADU in their own backyard poses its own challenge.

“It’s your home, and your property is something that’s very special to you,” Dos Santos-Tam said. “And so to conceive of somebody else living there – or to conceive of tearing up your backyard to put something there – it takes a lot.”

Honolulu used to allow ADUs in the 1980s but halted the practice in the 1990s. As the city’s housing crisis worsened, former Mayor Kirk Caldwell called for bringing them back, and the City Council passed a bill allowing them again in 2015.

Backtracking On Blueprints

Honolulu allows ADUs on lots 3,500 square feet or bigger, and city officials 10 years ago estimated about 20,000 lots on the island were eligible for this kind of development.

But practical considerations — like sewage capacity — have halted at least some proposed ADUs, Dos Santos-Tam said. He’s hoping to change the calculation for sewage capacity so the units are weighted lower.

“For neighborhoods where the whole neighborhood is way overcapacity, it’s not going to help them,” he said. “But in other neighborhoods it might – it might be enough to make a difference.”

In addition, council members have exempted ADUs from permit fees since 2016. These exemptions have been extended a few times since then, most recently when Dos Santos-Tam and council member Matt Weyer introduced a bill to extend the exemptions to 2030. Their bill passed in February.

The process of building an ADU can be daunting, especially since many homeowners aren’t construction professionals. One initiative to make it more approachable was to publish preapproved ADU blueprints online, something Mayor Rick Blangiardi announced during his State of the City address this year.

An architect would still have to make site-specific adjustments, Takeuchi Apuna told Civil Beat in an interview this spring, like if the property is on uneven terrain. Other than that, she said uploading pre-approved plans would help simplify the process and make it easier to visualize for homeowners.

Dos Santos-Tam and Heim both liked the idea of publishing ADU blueprints on the city’s permitting website, as did Kealoha, the Wahiawā ADU owner.

“I think it would’ve alleviated some of the stress,” Kealoha said.

But DPP canceled the idea after meeting with companies to ask them to send in blueprints for preapproval.

“In April, DPP met with industry stakeholders, and the overall feedback on the program was that the ADU templates were not necessarily helpful and many doubted the program would increase ADU application submittals,” Pitner said Friday in an emailed statement.

Design professionals also worried about the intellectual property of their designs and whether the upfront effort and cost to get them preapproved would be worth the number of customers sent their way, Pitner said.

When asked his thoughts on the cancellation, Dos Santos-Tam said he wasn’t sure what nuances were discussed between construction companies and DPP, but he figures DPP can promote ADU construction in other ways.

Heim still supports the city posting preapproved blueprints, something California started requiring of its municipalities this year. She also thinks some kind of online map showing sewage capacity would help homeowners know upfront if their property is viable.

The new law allowing two ADUs per residential lot forced counties to come up with rules regulating that. Honolulu did so through its updated Land Use Ordinance late last year.

But the measure elicited strong backlash. City Council members passed a resolution condemning it, saying that while they appreciate the sentiment of tackling the housing crisis, it overstepped into their territory and was too broad.

Soon after the bill was signed last summer, Sen. Stanley Chang, one of the bill’s sponsors, said in an interview he thought there was a disproportionate amount of hubbub over the bill relative to its likely effect.

Homeowners had been allowed to build one ADU on their residential lots for almost 10 years, he said at the time, and “the sky has not fallen.”

Chang pointed to a few reasons people haven’t been building ADUs on their properties, largely agreeing with Dos Santos-Tam and Heim that one issue is sewage capacity and another is just the general headache of starting a construction project.

DPP’s slow reputation exacerbates this, he said. Pitner, the DPP spokesperson, said the department expects permitting times will go down for all housing developments when a new AI-based plan review software program launches in the fall, including for ADUs.

This story first appeared in the Honolulu City Beat. Read the original here.