I noticed that you mentioned the 20% question, but missed the mark - it is not related to income as Mr. Savio based his answer, rather it is related to the deed restriction that requires a restriction on resale, allowing the property owner to retain a percentage of the market value upon resale. THe problem is that HUD/FHA allows for this type of profit sharing, but it cannot be below 50% shared value in order to meet HUD/FHA guidelines - the way the restriction is now, at around 20%, new purchasing residents will not be able to get a low interest loan under FHA - pricing intended buyers out of the market.
You cannot impose a 20% deed restriction on resale for workforce housing - it will limit the pool of potential buyers who need it most. HUD requires a minimum of 50% shared appreciation limit. As such, the workforce housing with a 20% deed restriction will never achieve FHA approval, limiting the ability of potential homeowners to get an FHA loan with a low down payment.
Thank you,
Meredith Muller
I speak for myself. I support Bills 12 and 74. We have been trying different ways to keep our homes from being resold to investors who see a high upside to Maui homes. These bills work to curb this practice and should be approved. We cannot afford to continue to build affordable homes to have them resold within 5 to 10 years. We see movement of our young people off island because they cannot find affordable homes. This means that our future leadership of our beautiful island will be increasing non-islander people. Many of them do not know what aloha and ohana mean. Let us stop the practice of the County of Maui giving developers lower county requirements or cash to build these homes and within 10 years they are sold to the highest bidder. Enough already!
I speak for myself. I support Bills 12 and 74. We have been trying different ways to keep our homes from being resold to investors who see a high upside to Maui homes. These bills work to curb this practice and should be approved. We cannot afford to continue to build affordable homes to have them resold within 5 to 10 years. We see movement of our young people off island because they cannot find affordable homes. This means that our future leadership of our beautiful island will be increasing non-islander people. Many of them do not know what aloha and ohana mean. Let us stop the practice of the County of Maui giving developers lower county requirements or cash to build these homes and within 10 years they are sold to the highest bidder. Enough already!
Testimony to the Housing and Land Use Committee
Regarding Bills 22 (2024), 12 (2023), and 74 (2023)
Aloha Chair and Members of the Housing and Land Use Committee,
I appreciate the opportunity to provide testimony regarding Bills 22 (2024), 12 (2023), and 74 (2023), which propose extending deed restrictions on workforce housing, expediting county purchases of these units, and enforcing continued affordability through resale restrictions. While the intent behind these policies is to preserve affordable housing for the long term, I urge the committee to consider the unintended consequences these changes could have on homeownership opportunities, developer participation, and overall housing stability in Maui County.
One of the primary concerns with these bills is that they create significant differences between first-time homebuyer opportunities in the general market and those purchasing workforce housing. Traditional first-time homebuyer programs offer financial assistance, such as down payment support or low-interest loans, but they do not impose resale restrictions that limit equity growth. Buyers in these programs can build wealth, sell their homes at market value, and use that capital to move into another home, creating upward mobility.
In contrast, workforce housing with extended deed restrictions traps homeowners in a cycle where their home remains affordable but does not provide the same financial benefits as market-rate homeownership. The inability to sell at market value significantly limits financial mobility, preventing families from using their home as a stepping stone to economic stability. Many residents aspire to move into market-rate housing over time, but these restrictions make that goal much harder to achieve. Instead of promoting homeownership as a tool for financial independence, these policies create a separate class of homeowners with fewer rights and opportunities.
Additionally, these bills could reduce developer incentives to build workforce housing. If buyers are deterred by long-term resale restrictions, fewer workforce housing units will be sold, discouraging future development. Private sector participation is essential for increasing housing inventory, and overly restrictive policies could push developers toward building only market-rate units, worsening the affordability crisis. Instead of discouraging development, the county should consider incentive-based approaches such as tax credits, fee reductions, or flexible zoning options to encourage workforce housing while allowing homeowners a pathway to financial growth.
Another critical concern is the administrative burden these policies will create. Restarting deed restrictions upon resale and fast-tracking county purchases of workforce housing units will require additional staffing, oversight, and financial resources. If the county is unable to efficiently manage these processes, delays in approvals, repurchases, and resale transactions could make workforce housing even less accessible to those who need it most. A more efficient approach would be to implement structured buyback programs or shared equity models that simplify the resale process while maintaining affordability.
Beyond administrative concerns, these policies could also distort the real estate market. If a significant portion of Maui’s housing stock remains locked under strict resale conditions while market-rate homes continue to appreciate, a two-tiered housing system will emerge. This could discourage participation in workforce housing programs altogether, leaving units unsold and further reducing affordable housing inventory. Instead of creating policies that separate workforce housing from the general market, solutions should focus on gradual affordability transitions that allow homeowners to benefit from appreciation while still maintaining long-term affordability for future buyers.
To create a more balanced approach, I encourage the committee to explore alternatives that support affordability while still allowing homeowners to build equity. A graduated release of deed restrictions could provide affordability protections while giving homeowners increasing ownership rights over time. Shared equity programs, where the county retains a portion of appreciation while allowing homeowners to benefit financially, could provide a fair compromise. Additionally, long-term land leases—where buyers own the home but lease the land—have been successfully used elsewhere to maintain affordability while still providing ownership opportunities.
Finally, workforce housing policies should focus on creating opportunities, not barriers. While maintaining affordable housing stock is crucial, homeownership should also serve as a tool for financial growth and stability. First-time homebuyers in the general market have the ability to sell at market rates, build wealth, and move forward in their homeownership journey. Workforce housing participants should have similar opportunities rather than being locked into a system that prevents financial progress.
Maui's housing market remains highly competitive, and while affordability must be a priority, policies must also ensure that workforce housing remains an attractive and viable option for both buyers and developers. Restrictive deed policies may unintentionally reduce workforce housing inventory rather than expand it. Homeownership should provide a pathway to financial security, not a system that keeps families in perpetual affordability restrictions without a way forward.
I respectfully urge the committee to reconsider the long-term implications of these bills and explore alternative policies that promote both affordability and economic opportunity. Thank you for your time and consideration.
Mahalo,
I noticed that you mentioned the 20% question, but missed the mark - it is not related to income as Mr. Savio based his answer, rather it is related to the deed restriction that requires a restriction on resale, allowing the property owner to retain a percentage of the market value upon resale. THe problem is that HUD/FHA allows for this type of profit sharing, but it cannot be below 50% shared value in order to meet HUD/FHA guidelines - the way the restriction is now, at around 20%, new purchasing residents will not be able to get a low interest loan under FHA - pricing intended buyers out of the market.
You cannot impose a 20% deed restriction on resale for workforce housing - it will limit the pool of potential buyers who need it most. HUD requires a minimum of 50% shared appreciation limit. As such, the workforce housing with a 20% deed restriction will never achieve FHA approval, limiting the ability of potential homeowners to get an FHA loan with a low down payment.
Thank you,
Meredith Muller
I speak for myself. I support Bills 12 and 74. We have been trying different ways to keep our homes from being resold to investors who see a high upside to Maui homes. These bills work to curb this practice and should be approved. We cannot afford to continue to build affordable homes to have them resold within 5 to 10 years. We see movement of our young people off island because they cannot find affordable homes. This means that our future leadership of our beautiful island will be increasing non-islander people. Many of them do not know what aloha and ohana mean. Let us stop the practice of the County of Maui giving developers lower county requirements or cash to build these homes and within 10 years they are sold to the highest bidder. Enough already!
I speak for myself. I support Bills 12 and 74. We have been trying different ways to keep our homes from being resold to investors who see a high upside to Maui homes. These bills work to curb this practice and should be approved. We cannot afford to continue to build affordable homes to have them resold within 5 to 10 years. We see movement of our young people off island because they cannot find affordable homes. This means that our future leadership of our beautiful island will be increasing non-islander people. Many of them do not know what aloha and ohana mean. Let us stop the practice of the County of Maui giving developers lower county requirements or cash to build these homes and within 10 years they are sold to the highest bidder. Enough already!
Testimony to the Housing and Land Use Committee
Regarding Bills 22 (2024), 12 (2023), and 74 (2023)
Aloha Chair and Members of the Housing and Land Use Committee,
I appreciate the opportunity to provide testimony regarding Bills 22 (2024), 12 (2023), and 74 (2023), which propose extending deed restrictions on workforce housing, expediting county purchases of these units, and enforcing continued affordability through resale restrictions. While the intent behind these policies is to preserve affordable housing for the long term, I urge the committee to consider the unintended consequences these changes could have on homeownership opportunities, developer participation, and overall housing stability in Maui County.
One of the primary concerns with these bills is that they create significant differences between first-time homebuyer opportunities in the general market and those purchasing workforce housing. Traditional first-time homebuyer programs offer financial assistance, such as down payment support or low-interest loans, but they do not impose resale restrictions that limit equity growth. Buyers in these programs can build wealth, sell their homes at market value, and use that capital to move into another home, creating upward mobility.
In contrast, workforce housing with extended deed restrictions traps homeowners in a cycle where their home remains affordable but does not provide the same financial benefits as market-rate homeownership. The inability to sell at market value significantly limits financial mobility, preventing families from using their home as a stepping stone to economic stability. Many residents aspire to move into market-rate housing over time, but these restrictions make that goal much harder to achieve. Instead of promoting homeownership as a tool for financial independence, these policies create a separate class of homeowners with fewer rights and opportunities.
Additionally, these bills could reduce developer incentives to build workforce housing. If buyers are deterred by long-term resale restrictions, fewer workforce housing units will be sold, discouraging future development. Private sector participation is essential for increasing housing inventory, and overly restrictive policies could push developers toward building only market-rate units, worsening the affordability crisis. Instead of discouraging development, the county should consider incentive-based approaches such as tax credits, fee reductions, or flexible zoning options to encourage workforce housing while allowing homeowners a pathway to financial growth.
Another critical concern is the administrative burden these policies will create. Restarting deed restrictions upon resale and fast-tracking county purchases of workforce housing units will require additional staffing, oversight, and financial resources. If the county is unable to efficiently manage these processes, delays in approvals, repurchases, and resale transactions could make workforce housing even less accessible to those who need it most. A more efficient approach would be to implement structured buyback programs or shared equity models that simplify the resale process while maintaining affordability.
Beyond administrative concerns, these policies could also distort the real estate market. If a significant portion of Maui’s housing stock remains locked under strict resale conditions while market-rate homes continue to appreciate, a two-tiered housing system will emerge. This could discourage participation in workforce housing programs altogether, leaving units unsold and further reducing affordable housing inventory. Instead of creating policies that separate workforce housing from the general market, solutions should focus on gradual affordability transitions that allow homeowners to benefit from appreciation while still maintaining long-term affordability for future buyers.
To create a more balanced approach, I encourage the committee to explore alternatives that support affordability while still allowing homeowners to build equity. A graduated release of deed restrictions could provide affordability protections while giving homeowners increasing ownership rights over time. Shared equity programs, where the county retains a portion of appreciation while allowing homeowners to benefit financially, could provide a fair compromise. Additionally, long-term land leases—where buyers own the home but lease the land—have been successfully used elsewhere to maintain affordability while still providing ownership opportunities.
Finally, workforce housing policies should focus on creating opportunities, not barriers. While maintaining affordable housing stock is crucial, homeownership should also serve as a tool for financial growth and stability. First-time homebuyers in the general market have the ability to sell at market rates, build wealth, and move forward in their homeownership journey. Workforce housing participants should have similar opportunities rather than being locked into a system that prevents financial progress.
Maui's housing market remains highly competitive, and while affordability must be a priority, policies must also ensure that workforce housing remains an attractive and viable option for both buyers and developers. Restrictive deed policies may unintentionally reduce workforce housing inventory rather than expand it. Homeownership should provide a pathway to financial security, not a system that keeps families in perpetual affordability restrictions without a way forward.
I respectfully urge the committee to reconsider the long-term implications of these bills and explore alternative policies that promote both affordability and economic opportunity. Thank you for your time and consideration.
Mahalo,
Edward Codelia