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Kailua, Oahu – Where the ultra-rich drive prices way beyond affordable

From the moment I first saw it, way back in 2001, I knew that I wanted to live in Kailua. Who wouldn’t want to live there? Gentle trade winds, sandy beaches, lush picturesque mountains behind, and a laid back beach town atmosphere that seemed to have come right out of the movies. The first time I saw it, I wasn’t a tourist, I was breaking up a concrete driveway for my then boss with a pick and shovel for $10 an hour. After nearly killing myself to get the job done, my boss suggested that I walk down to the beach and take a swim – her house was just a few blocks away from Kailua Beach Park. I walked down there – saw the picture perfect islands beyond the picture perfect sand beyond the picture perfect grass rimmed with picture perfect palm trees and then I got in the water and it was love love love. Two years later when I moved back to Oahu from Kauai and decided to stay on Oahu, I rented a storage unit and mailbox in Kailua – my first step towards living there. It took a year of living in my van but finally, I found a good job and an apartment in Kailua – a large studio for the then princely sum of $750/month.  It was three blocks from the beach. I fell in love while I lived in that apartment and suffered a broken heart and later moved to picturesque Lanikai with my lady – it was a mistake to move, I think. The rent in Lanikai was an impossible $1500 per month for a small cottage we shared – but our relationship was damaged and though we tried to fix things – it probably would have been better for us if I had kept my studio. In any event, when I enrolled in UH we moved to an apartment on Punchbowl – over on the town side – and then when it became obvious that housing wasn’t the problem – I moved into a different studio in Manoa for $900/month. And then I left Hawai’i, left the United States, and lived abroad where I found a new love, helped create a new life, and then moved back to the USA and after four long years on the Oregon Coast – finally had the resources to move my family back to Hawai’i. I dreamed of my daughter riding her bike in Kailua, I dreamed of living close to my old studio there, and instead I found that the cheapest small studio I could find was now in the range of $2000/month and there was no way that I could afford it. The prices in Hawai’i have more than doubled in the last 10 years – for housiing and for other things – and there was no way to live in Kailua, at least not for now, not on an archaeologist’s entry level wages – probably not on an archaeologist’s wages at all.

President Barack Obama signs H.R. 847, the “James Zadroga 9/11 Health and Compensation Act” in Kailua, Hawaii, Jan. 2, 2011. (Official White House Photo by Pete Souza)
This official White House photograph is being made available only for publication by news organizations and/or for personal use printing by the subject(s) of the photograph. The photograph may not be manipulated in any way and may not be used in commercial or political materials, advertisements, emails, products, promotions that in any way suggests approval or endorsement of the President, the First Family, or the White House.

What changed in Kailua (and Hawai’i for that matter)? I can see several things. First of all, President Obama really put Kailua on the map when he took his family vacations there…next was the extreme concentration of wealth after the great recession- the rich have consolidated their holdings and Kailua is the perfect place for a rich person’s vacation home – finally, and perhaps most importantly – AirBnB and similar peer to peer vacation rentals have made renting an apartment or house for the night more profitable than renting it for a year – landlords have converted almost wholesale to hoteliers with managed housekeeping and outsourced concierge. Kailua is a place where you can live if you lived there before all of this or if you have extreme wealth – but other than that – there aren’t a lot of good jobs there, the commute to jobs in town is longer than necessary, and frankly, the landlord class has determined that temporary residents increase their wealth more than long term. All of this, of course, has driven the real estate prices sky high – not just in Kailua but on Oahu as a whole. Median price for a single family home is in excesss of $1 million and median price for an apartment is over $800k – which means there is a lot of competition to buy the very shitty properties that clock in under those numbers….I don’t have the data on who the owners of real estate are in Hawai’i, but when you take out the military (which owns a huge amount) and organizations like Kamehameha Schools, Bishop Estate, and Campbell Estate – what you are left with is ultra-rich absentee landlords – and they have  priced nearly everyone out of paradise – not just out of Kailua, but out of Hawai’i in general.

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Vago Damitio

Damitio  (@vagodamitio) is the Editor-in-Chief for Vagobond. Life is good. You can also find him on Google+ and at Facebook

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