Why It Matters
Hawaii faces a critical housing shortage that threatens to deepen workforce gaps and drive younger residents off the islands. A new analysis projects the state will need nearly 60,000 additional housing units by 2050, with three-quarters of that demand coming within the next decade. The shortfall affects both elderly residents seeking affordable places to age in place and working-age families priced out of the market.
What Happened
AARP Hawaii released a housing needs analysis based on 2024 U.S. Census data that outlines future demand by age group and income level. The report frames the housing shortage as both a demographic challenge and an economic threat, as younger workers leave the state for more affordable mainland markets.
Keali’i Lopez, state director of AARP Hawaii, said the crisis affects multiple generations. When working families cannot afford to stay, fewer caregivers remain available to support aging relatives, he noted in a statement accompanying the report.
The analysis was conducted by Econorthwest, an Oregon-based consulting firm.
By the Numbers
Residents age 65 and older will require 44,000 of the projected 60,000 new units. The proportion of Hawaii’s population in that age bracket grew from 16 percent in 2016 to over 21 percent in 2024. A University of Hawaii study projects a quarter of state residents will be 65 or older by 2035.
Between 2014 and 2024, Hawaii added 43,000 housing units, an 8 percent increase. Over the same period, the number of households grew 9.5 percent, outpacing new construction.
Nearly two-thirds of the 60,000 additional units will be needed by 2035. Honolulu County requires the largest total—48,299 units by 2050—while Kauai faces the steepest percentage increase at 18 percent over current supply.
Just under one-third of new units for residents 65 and older must be affordable for those earning less than $63,900 annually, or 60 percent of area median income, according to the report.
Hawaii has the nation’s third-worst retention rate for residents aged 20 to 30, trailing only Alaska and Wyoming. Nearly half of Hawaii-born residents in that age bracket now live in other states, according to 2023 Census data cited in the analysis.
Zoom Out
High housing costs are pushing working-age residents out of many coastal states, but Hawaii’s geographic isolation and limited land supply intensify the problem. The state’s housing affordability crisis mirrors challenges in California and the Pacific Northwest, where aging populations and constrained inventory drive up prices.
The outmigration of younger workers creates service-sector labor shortages, particularly in healthcare. Neighbor island residents increasingly travel to Oahu for specialized medical care, a trend the report warns will worsen without sufficient affordable housing to retain working-age professionals.
What’s Next
The report calls for prioritizing housing that supports aging in place and accommodates smaller households. Meeting the projected demand will require sustained construction activity well above recent levels, as the state added fewer units than new households over the past decade.
Policymakers face pressure to expand affordable housing production while addressing zoning, land-use, and infrastructure constraints that have historically limited supply. The analysis suggests workforce retention depends on making housing accessible to families earning below median income.