How Workforce Homeowners Can Build Wealth & What Happens When They Want to Move Up
Workforce housing is designed to provide stable, affordable homeownership for local residents—but many buyers wonder: How do I build wealth in a deed-restricted home? Can I pass it down to my family? What happens when I want to buy a market-rate home?
Here’s what homeowners need to know:
________________________________________
1. Building Wealth in a Workforce Home
Even with deed restrictions, homeowners can build wealth in several ways:
✅ Equity Growth – Many workforce housing programs use a shared equity model, where homeowners earn a portion of the home’s appreciation over time. Instead of flipping for profit, the home stays affordable, but the owner still benefits from value increases.
✅ Mortgage Paydown – Each monthly mortgage payment builds equity, meaning the homeowner owns more of their home as time goes on.
✅ Locked-In Housing Costs – Unlike renters who face rising rents, homeowners with a fixed mortgage keep stable payments, allowing them to save and invest elsewhere.
✅ Government Assistance & Programs – Some workforce housing programs help with refinancing or second-time home purchases, making it easier to transition into a market-rate home later.
________________________________________
2. Can Workforce Housing Be Passed Down to Family?
This depends on the program’s rules, but in most cases:
🔹 Yes, but only if the heir qualifies. Workforce homes are meant for working residents, so heirs must meet income and owner-occupancy requirements to inherit the home.
🔹 If the heir doesn’t qualify, the home must be resold under the workforce housing program, keeping it affordable for another local buyer.
🔹 Some programs allow intergenerational transfers, but only to immediate family members who plan to live in the home.
________________________________________
3. Moving Up: How to Transition to Market-Rate Housing
Workforce housing isn’t meant to be a forever home for everyone—some owners eventually want to buy a larger or market-rate home. Here’s how they can step up:
🔸 Selling Within the Program – Homeowners sell their home to another workforce buyer at an affordable price, keeping the housing stock intact while cashing out any allowed equity gains.
🔸 Using Built-Up Savings & Equity – Over time, mortgage payments and shared equity help homeowners save for a down payment on a market-rate home.
🔸 Graduation Programs – Some counties offer pathways to market-rate homeownership, such as priority in new developments or financial assistance for a second home purchase.
🔸 Earning More & Requalifying – If a homeowner’s income rises beyond workforce housing limits, they may be required to sell the home and transition to the open market.
________________________________________
Conclusion: Stability First, Wealth Second
Workforce housing is not a get-rich-quick investment, but it does offer something more important: stability, long-term affordability, and a stepping stone to future homeownership.
To truly make this system work for locals, Maui should:
✔️ Ensure workforce homes remain workforce housing to protect affordability
✔️ Allow reasonable equity-building opportunities without full market-rate resale
✔️ Create pathways for homeowners to move into market-rate housing
✔️ Allow qualified heirs to inherit homes if they meet income and occupancy rules
Workforce housing is meant to keep local families housed, not to be flipped for profit. With smart policies, it can also help owners step up to the next level when they’re ready.
Why Workforce Housing Should Remain Workforce Housing
Maui’s workforce housing program was created to provide affordable homeownership opportunities to local residents who otherwise couldn’t afford to buy in the open market. However, without strong protections, these homes often end up becoming part of the expensive market-rate housing stock after just a few years, leaving us in the same housing crisis we are in today. Below are five key reasons why workforce housing must remain workforce housing indefinitely.
Five Reasons Workforce Housing Must Stay Affordable
1. Prevent the Loss of Affordable Homes Over Time.
o If workforce homes are allowed to be sold at market rates after a limited restriction period, they will be lost to outside investors or wealthier buyers. We have already seen this pattern—units originally built to be affordable get flipped for a massive profit once restrictions expire.
2. Protect Local Families and Essential Workers.
o Many of our teachers, nurses, police officers, and service workers can’t compete with mainland buyers, investors, and short-term rental conversions. Keeping workforce housing permanently affordable ensures that homes built for our local workforce continue serving future generations.
3. Stop Investor Speculation.
o Some buyers treat workforce housing as a short-term investment, purchasing affordable homes only to sell them at full market value when restrictions expire. This drives up prices and pushes out local families, creating a cycle where workforce housing doesn’t actually benefit workers long-term.
4. Keep Communities Stable.
o When workforce housing flips to market rates, it displaces local residents and contributes to the housing crisis. This leads to families leaving the island, causing labor shortages and harming the economy. Keeping these homes affordable keeps our teachers, nurses, police officers, and essential workers in our community.
5. Homeownership Shouldn’t Mean a Get-Rich-Quick Scheme.
o Workforce housing is meant to provide stable homes, not quick profits. While homeownership is a wealth-building tool, its primary purpose in workforce housing is to create stability and keep housing accessible for working families. Without strong resale controls, workforce homes are at risk of becoming just another stepping stone for investors, rather than a sustainable housing option for future residents.
How to Fix Workforce Housing in Maui
Since the County’s workforce housing programs have failed to keep homes affordable, real change is needed. Here’s what the County should do instead:
1. Adopt a Shared Equity Model.
o Shared equity programs allow families to build wealth over time while ensuring homes remain affordable for future buyers. The County should maintain partial ownership of the homes or use land leases to limit resale prices to keep homes permanently affordable.
2. Cap Home Resale Prices. Workforce housing should be sold only to local workers at prices tied to income levels, not the skyrocketing real estate market. This prevents windfall profits for early buyers and ensures homes remain affordable.
3. Create a Public Housing Trust to Own and Develop Affordable Homes.
o The County should acquire and maintain a permanent stock of workforce housing by owning the land and leasing homes to eligible buyers under long-term agreements. This model is successfully used in cities facing housing crises, preventing homes from being flipped for profit.
4. Public-Private Partnerships for Faster Housing Development.
o The County should provide land or financial incentives for private developers to build true workforce housing with permanent affordability agreements instead of short-term deed restrictions.
5. Strict Owner-Occupancy Enforcement and Anti-Speculation Rules.
o Maui should strengthen owner-occupancy requirements to prevent investors from flipping workforce homes into vacation rentals or luxury properties. Homeowners who sell should only be able to sell to other workforce buyers at set affordability rates, preventing these homes from being lost to the open market.
Final Recommendation
Based on this analysis, I do not support Bills 22, 12, and 74 as written. Instead of making workforce housing permanently affordable, they only delay the loss of affordability by a few more years, which will continue the cycle of scarcity and price inflation.
Maui County needs to implement real shared equity models, enforce owner-occupancy rules, stop speculative selling, and take an active role in developing and maintaining workforce housing. The current program has not worked as intended, and these amendments fail to solve the root problems.
I urge this committee to reject these amendments in their current form and push for stronger policies that ensure permanent affordability, shared equity programs, and real protections against speculative reselling. This is the only way to ensure workforce housing actually serves our local families for generations to come.
Thank you for the opportunity to testify.
Edward Codelia
Thank you again for the opportunity to make my thoughts known on the issue at hand
Obviously there are several folks that would like to make their opinions clear on the subject as well.
I am of the opinion that The county should continue to support those that wish to provide their services of construction and development of housing for various ami groups. And take every opportunity to create more affordable and workforce housing.
And as we all acknowledge those, groups are hopefully upwardly mobile at some time in there working future so that they can move in to more market valued properties Releasing.
Their properties to be used by new families That need and desire housing in Maui county.
In a nutshell, I believe that we should maintain properties in a reasonable time period such as ten years To a maximum of 20, depending upon the A.M I that we are Positioning the properties for
And once the properties are sold, they should be allowed appreciation to the extent of. Yearly inflation rate in hawaii as well as a reasonable appreciation rate somewhere between two percent and three percent annually
The properties should be maintained in their various ami status positions for the entirety of their useful life
. I am going to.
Allow my testimony to stand whereas it appears that there is a plethora of folks willing to state their positions.
I will direct the committee to look at Responses from Lawrence Carnicelli. I believe he has done a Reasonably thorough investigation and responding responses to the questions directed to the group.
Thank you for considering my testimony.And kindly enter this into the File of additional testimony thank you Ray Phillips
How Workforce Homeowners Can Build Wealth & What Happens When They Want to Move Up
Workforce housing is designed to provide stable, affordable homeownership for local residents—but many buyers wonder: How do I build wealth in a deed-restricted home? Can I pass it down to my family? What happens when I want to buy a market-rate home?
Here’s what homeowners need to know:
________________________________________
1. Building Wealth in a Workforce Home
Even with deed restrictions, homeowners can build wealth in several ways:
✅ Equity Growth – Many workforce housing programs use a shared equity model, where homeowners earn a portion of the home’s appreciation over time. Instead of flipping for profit, the home stays affordable, but the owner still benefits from value increases.
✅ Mortgage Paydown – Each monthly mortgage payment builds equity, meaning the homeowner owns more of their home as time goes on.
✅ Locked-In Housing Costs – Unlike renters who face rising rents, homeowners with a fixed mortgage keep stable payments, allowing them to save and invest elsewhere.
✅ Government Assistance & Programs – Some workforce housing programs help with refinancing or second-time home purchases, making it easier to transition into a market-rate home later.
________________________________________
2. Can Workforce Housing Be Passed Down to Family?
This depends on the program’s rules, but in most cases:
🔹 Yes, but only if the heir qualifies. Workforce homes are meant for working residents, so heirs must meet income and owner-occupancy requirements to inherit the home.
🔹 If the heir doesn’t qualify, the home must be resold under the workforce housing program, keeping it affordable for another local buyer.
🔹 Some programs allow intergenerational transfers, but only to immediate family members who plan to live in the home.
________________________________________
3. Moving Up: How to Transition to Market-Rate Housing
Workforce housing isn’t meant to be a forever home for everyone—some owners eventually want to buy a larger or market-rate home. Here’s how they can step up:
🔸 Selling Within the Program – Homeowners sell their home to another workforce buyer at an affordable price, keeping the housing stock intact while cashing out any allowed equity gains.
🔸 Using Built-Up Savings & Equity – Over time, mortgage payments and shared equity help homeowners save for a down payment on a market-rate home.
🔸 Graduation Programs – Some counties offer pathways to market-rate homeownership, such as priority in new developments or financial assistance for a second home purchase.
🔸 Earning More & Requalifying – If a homeowner’s income rises beyond workforce housing limits, they may be required to sell the home and transition to the open market.
________________________________________
Conclusion: Stability First, Wealth Second
Workforce housing is not a get-rich-quick investment, but it does offer something more important: stability, long-term affordability, and a stepping stone to future homeownership.
To truly make this system work for locals, Maui should:
✔️ Ensure workforce homes remain workforce housing to protect affordability
✔️ Allow reasonable equity-building opportunities without full market-rate resale
✔️ Create pathways for homeowners to move into market-rate housing
✔️ Allow qualified heirs to inherit homes if they meet income and occupancy rules
Workforce housing is meant to keep local families housed, not to be flipped for profit. With smart policies, it can also help owners step up to the next level when they’re ready.
March 13, 2025
TO: Housing and Land Use Committee
Why Workforce Housing Should Remain Workforce Housing
Maui’s workforce housing program was created to provide affordable homeownership opportunities to local residents who otherwise couldn’t afford to buy in the open market. However, without strong protections, these homes often end up becoming part of the expensive market-rate housing stock after just a few years, leaving us in the same housing crisis we are in today. Below are five key reasons why workforce housing must remain workforce housing indefinitely.
Five Reasons Workforce Housing Must Stay Affordable
1. Prevent the Loss of Affordable Homes Over Time.
o If workforce homes are allowed to be sold at market rates after a limited restriction period, they will be lost to outside investors or wealthier buyers. We have already seen this pattern—units originally built to be affordable get flipped for a massive profit once restrictions expire.
2. Protect Local Families and Essential Workers.
o Many of our teachers, nurses, police officers, and service workers can’t compete with mainland buyers, investors, and short-term rental conversions. Keeping workforce housing permanently affordable ensures that homes built for our local workforce continue serving future generations.
3. Stop Investor Speculation.
o Some buyers treat workforce housing as a short-term investment, purchasing affordable homes only to sell them at full market value when restrictions expire. This drives up prices and pushes out local families, creating a cycle where workforce housing doesn’t actually benefit workers long-term.
4. Keep Communities Stable.
o When workforce housing flips to market rates, it displaces local residents and contributes to the housing crisis. This leads to families leaving the island, causing labor shortages and harming the economy. Keeping these homes affordable keeps our teachers, nurses, police officers, and essential workers in our community.
5. Homeownership Shouldn’t Mean a Get-Rich-Quick Scheme.
o Workforce housing is meant to provide stable homes, not quick profits. While homeownership is a wealth-building tool, its primary purpose in workforce housing is to create stability and keep housing accessible for working families. Without strong resale controls, workforce homes are at risk of becoming just another stepping stone for investors, rather than a sustainable housing option for future residents.
How to Fix Workforce Housing in Maui
Since the County’s workforce housing programs have failed to keep homes affordable, real change is needed. Here’s what the County should do instead:
1. Adopt a Shared Equity Model.
o Shared equity programs allow families to build wealth over time while ensuring homes remain affordable for future buyers. The County should maintain partial ownership of the homes or use land leases to limit resale prices to keep homes permanently affordable.
2. Cap Home Resale Prices. Workforce housing should be sold only to local workers at prices tied to income levels, not the skyrocketing real estate market. This prevents windfall profits for early buyers and ensures homes remain affordable.
3. Create a Public Housing Trust to Own and Develop Affordable Homes.
o The County should acquire and maintain a permanent stock of workforce housing by owning the land and leasing homes to eligible buyers under long-term agreements. This model is successfully used in cities facing housing crises, preventing homes from being flipped for profit.
4. Public-Private Partnerships for Faster Housing Development.
o The County should provide land or financial incentives for private developers to build true workforce housing with permanent affordability agreements instead of short-term deed restrictions.
5. Strict Owner-Occupancy Enforcement and Anti-Speculation Rules.
o Maui should strengthen owner-occupancy requirements to prevent investors from flipping workforce homes into vacation rentals or luxury properties. Homeowners who sell should only be able to sell to other workforce buyers at set affordability rates, preventing these homes from being lost to the open market.
Final Recommendation
Based on this analysis, I do not support Bills 22, 12, and 74 as written. Instead of making workforce housing permanently affordable, they only delay the loss of affordability by a few more years, which will continue the cycle of scarcity and price inflation.
Maui County needs to implement real shared equity models, enforce owner-occupancy rules, stop speculative selling, and take an active role in developing and maintaining workforce housing. The current program has not worked as intended, and these amendments fail to solve the root problems.
I urge this committee to reject these amendments in their current form and push for stronger policies that ensure permanent affordability, shared equity programs, and real protections against speculative reselling. This is the only way to ensure workforce housing actually serves our local families for generations to come.
Thank you for the opportunity to testify.
Edward Codelia
Thank you again for the opportunity to make my thoughts known on the issue at hand
Obviously there are several folks that would like to make their opinions clear on the subject as well.
I am of the opinion that The county should continue to support those that wish to provide their services of construction and development of housing for various ami groups. And take every opportunity to create more affordable and workforce housing.
And as we all acknowledge those, groups are hopefully upwardly mobile at some time in there working future so that they can move in to more market valued properties Releasing.
Their properties to be used by new families That need and desire housing in Maui county.
In a nutshell, I believe that we should maintain properties in a reasonable time period such as ten years To a maximum of 20, depending upon the A.M I that we are Positioning the properties for
And once the properties are sold, they should be allowed appreciation to the extent of. Yearly inflation rate in hawaii as well as a reasonable appreciation rate somewhere between two percent and three percent annually
The properties should be maintained in their various ami status positions for the entirety of their useful life
. I am going to.
Allow my testimony to stand whereas it appears that there is a plethora of folks willing to state their positions.
I will direct the committee to look at Responses from Lawrence Carnicelli. I believe he has done a Reasonably thorough investigation and responding responses to the questions directed to the group.
Thank you for considering my testimony.And kindly enter this into the File of additional testimony thank you Ray Phillips