Maui Hotels Have the Highest Rates But the Lowest Occupancy

[ScoopKona]

Many topics being discussed.

Where I live, very few steady jobs pay the legal minimum wage. Any business that wants to get workers has to pay significantly above minimum wage, even McDonalds and Walmart. Migrant workers make more than $15/hr. Most people I know in Hawaii also make more than $15/hr. I don't see how you would be able to sustain yourself, much less a family, staying at a job that can get away with paying the minimum wage.

Just addressing the point above: I pay attention to the help wanted signs on every other business window as I mosey around town. There are bunches of places that are paying $15 or close to it -- $16, $18 is common.

Let's say we have a straw man EMT making the state average of $37K per year. That's WAY less than $18 an hour because he or she is salary and working 50-hour+ weeks. Raise the minimum wage to a more-reasonable (but still not reasonable) $20/hr and that straw man EMT has a little more clout when demanding better pay.

"Why should I bust my ass dealing with the dead and dying, working these long hours, when I could be a night security guard and make the exact same pay?!?!?!?"

Better minimum wages are the best example of the idiom "a rising tide lifts all boats."

And let's get real for a moment. $20/hr in Hawaii, after payroll taxes, is $600 per 40-hour week. (I just ran the numbers.) What is the hard-working grocery clerk going to do with $2,400 per month in take-home pay? That isn't a life. That isn't even existence. The people who work the tourist jobs that Hawaii timeshare visitors rely on are lucky if they're making that. I think it's appalling.

 

[Henry M.]

Around here businesses just don't get workers if they don't offer a decent wage. Here $15/hr goes a lot further than in Hawaii. Many customer facing servers in Hawaii are making over $20/hr plus tips.

Maybe the low end jobs that barely pay minimum wage should just be stepping stone towards something better? Do you expect someone to be able to sustain themselves at the low end without roommates or others contributing to the household expenses? Should even the most menial job provide for someone's complete living expenses?

 

[Tamaradarann]

I'm just looking for even a little consistency. You seem to be bankrupt on that.

You seem to be far more concerned with whether someone is deserving of decent wages than actually fixing any problems. And none of the fixes had better affect your pocketbook.

If you were concerned with the plight of native Hawaiians, you wouldn't be in favor of raising their property taxes. You wouldn't be in favor of taking money from them and giving it to teachers.

And I can't see how anyone looks at a $15/hour minimum wage in this state and thinks, "Great! This is awesome! Problem solved! Break out the good champagne!"

Nobody can live on $15/hour. That barely covers rent with nothing else. My neighbors deserve better than this.

Sorry, can't relate to your last comments. I won't comment on responses that have little or no relevance to my positions and my previous statements.

 

[bnoble]

Should even the most menial job provide for someone's complete living expenses?

Food, clothing, shelter? Yes.

 

[Tamaradarann]

The thing with doctors, nurses and even home health/homecare aides is that their salaries are not typically paid for by taxes. Most of them work for private companies that get paid by their clients (or, more accurately/often, their clients' insurance). The free market determines what they get paid. There is no free market for determining public school teacher wages, they just make an agreement with the government and it gets forced down the taxpayer's throat.

Now I get it. Your position is that since public school teachers get paid by the Government they can't be paid more since it will raise taxes. I understand your position, but don't agree with it. Public schools are extremely important to raising up standard of living of those in the lower and even middle income brackets who can't afford private schools.

I will state my position on the issue of public versus private schools in Hawaii. (By way this is also true in New York City, but not on Long Island and I will address that later)

Private Schools in Hawaii are currently better than public schools. Families who can afford private school for their children pay to send their children to public schools. Since the higher income people send their children to private schools they have little interest in paying more in taxes to improve public schools. Furthermore, those higher income people do not care if good public school teachers leave do to low pay or that those that are most enthusiastic and motivated to become teachers will flock to private schools rather than public schools. The children that come from lower income families and go to public schools are those that are typically from minority groups. In New York City it is African Americans and Hispanics. In Hawaii it is Native Hawaiians, Pacific Islanders, Filipinos, and some Asian Groups. It smacks of classism and racism.

Private School versus Public Schools on Long Island. I have an interesting life experience with public and private school education on Long Island. I went to public elementary school. My Mother wanted me to go to the new Catholic Elementary School (K-8) that opened in our neighborhood for 7th and 8th grade. I told her I didn't want to so I went to the public Junior High for 7th and 8th grade. Well in 9th grade kids who went to the Cathoic Elementary School and didn't go on to a Catholic High School which was not in our neighborhood were mixed together with the kids from the Junior High. I was just a 75-80 average student in 7th and 8th grade. The kids from the Catholic Elementary School came with 95-97 averages. However, in 9th grade I blew those Catholic School kids away academically and did much bettter than they did. Most of the public schools on Long Island are excellent as opposed to the quality of public schools in NYC or Hawaii.

 

[sponger76]

Public schools are extremely important to raising up standard of living of those in the lower and even middle income brackets who can't afford private schools.

I have to disagree. Public schools are important for teaching the basics - reading, writing, math, etc. Beyond enabling people to the achieve the bare minimum to participate in society (and they sometimes fail at that objective, graduating students who can't really do those simple tasks), they don't raise the standard of living. I see generations of families who go to public schools and the successive generations are not any better off, and in some cases end up worse off. What raises up the standard of living is making good choices: choosing a good career, some of which do not require college, or else choosing to go to college and going into a major that actually translates into good employment. Some college degrees aren't worth the paper they're printed on in terms of a well-paying job, much less the tons of money expended to obtain them.

 

[lynne]

I have to disagree. Public schools are important for teaching the basics - reading, writing, math, etc. Beyond enabling people to the achieve the bare minimum to participate in society (and they sometimes fail at that objective, graduating students who can't really do those simple tasks), they don't raise the standard of living. I see generations of families who go to public schools and the successive generations are not any better off, and in some cases end up worse off. What raises up the standard of living is making good choices: choosing a good career, some of which do not require college, or else choosing to go to college and going into a major that actually translates into good employment. Some college degrees aren't worth the paper they're printed on in terms of a well-paying job, much less the tons of money expended to obtain them.

At one time, I was a student assistant and taught a basic geology class on Long Island at Nassau Community College. I was appaled that some schools on Long Island simply advanced students from grade to grade without the necessary skills. There was on student that in my class who was illiterate and did not have the basic concepts of reading or writing. Since this was a community college, the bar to get enrolled was set pretty low, but common sense shoud have prevailed and not matriculated this child into college.

Since @Tamaradarann pointed out that schools on Long Island are superior because of teacher salaries, I really need to disagree. It is the professionalism of someone who goes into that particular field and wants to devote their life to teaching our youth. Good salaries are a byproduct of some districts but does not insure that you child will be getting a great eduation. The student has to want to learn, the teacher has to want to teach.

Native Hawaiians have the opportunity to send their children to Kamehameha Schools which is highly subsidized and provides a premier education in the state on par or exceeding Hawaii's private schools. Yes, the child has to display the aptitude to want to learn but there are options.

We also have a very large network of home schooled children who graduate and go on to higher education or in some cases, become very successful entrepreneurs.

To your point, one size does not fit all.

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[ScoopKona]

I was appaled that some schools on Long Island simple advanced students from grade to grade without the necessary skills.

I grew up in an area with worthless schools -- the sort of schools which taught the Lost Cause theory of the Civil War, and that evolution is a hoax.

So I was shuttled up north where I attended great schools -- the kind of schools that make best-of lists.
Even at these schools, most of the students did not gain any advantage being there (other than checking a box for the next prep-school). Since the average student had no real interest in learning, these schools were just more-expensive versions of public schools, albeit with stricter rules. When these students finally graduated high school, daddy endowed his alma mater (where the entire family is a legacy, back to the antebellum period). These privileged kids were sent off to the Ivy League to obtain their gentleman's C.

The point is that even in the private schools where teachers are paid double, most of the kids are mouth-breathers who are only there because they chose the right parents.

My wife is a recently-retired special education teacher. She gauges her success not by how many Nobel Laureates she helps mold; but by how many children she can keep out of prison. Put a price on that.

 

[Henry M.]

Food, clothing, shelter? Yes.

To live alone in a housing unit, or can it require a couple of people to pool their resources?

 

[ScoopKona]

To live alone in a housing unit, or can it require a couple of people to pool their resources?

I have an 80 (or 90)-year old auntie neighbor who demands that things were better right around statehood because, "finally, enough houses were built. Then they stopped building and now it's horrible." People didn't stop moving here. They just stopped building enough houses to support influx.

If we fix housing, most of the state's problems go away because of that.

Our big picture problems are: 1) We have let inflation run away from reality -- wages are laughable. 2) There aren't enough houses to support our population.

And since the average person doesn't get supply vs. demand; they lay the blame on "greedy investors" and "greedy landlords" and "greedy millionaires." They don't lay the blame on "not enough houses to go around."

 

[davidvel]

There are basically two competing beliefs at play here:

Group 1 generally believes that there are low-end jobs requiring little skill, education and experience that do not need to pay enough for one to live alone with all clothing, food shelter, insurance, etc paid. This Group considers these to be entry level jobs such as high school students or others entering the workforce with little to no skill, education or experience, who either live with parents or roommates, keeping their expenses as low as possible as needed to cover costs, while they gain skill, education and experience for a higher paying job. They believe that jobs should and will pay wages based on supply and demand of available workers for a particular job, which includes and is dependent on the the skill, education and experience of available workers.

Group 2 generally believes that the government should mandate that all jobs should pay enough (minimum wage) for an individual to live alone with all clothing, food shelter, insurance, etc paid, despite the job requiring little to no skill, education or experience. Many in this Group also advocate further, that the government should mandate that all jobs should pay enough (living wage) that the worker can support a family, including multiple dependents, to provide all clothing, food shelter, insurance, etc. for 3-5 persons, regardless of the person's skill, education or experience.

There may be variations of the above, but generally, the two Groups don't change their minds, despite arguments form those in the other Group.

 

[Tamaradarann]

I grew up in an area with worthless schools -- the sort of schools which taught the Lost Cause theory of the Civil War, and that evolution is a hoax.

So I was shuttled up north where I attended great schools -- the kind of schools that make best-of lists.
Even at these schools, most of the students did not gain any advantage being there (other than checking a box for the next prep-school). Since the average student had no real interest in learning, these schools were just more-expensive versions of public schools, albeit with stricter rules. When these students finally graduated high school, daddy endowed his alma mater (where the entire family is a legacy, back to the antebellum period). These privileged kids were sent off to the Ivy League to obtain their gentleman's C.

The point is that even in the private schools where teachers are paid double, most of the kids are mouth-breathers who are only there because they chose the right parents.

My wife is a recently-retired special education teacher. She gauges her success not by how many Nobel Laureates she helps mold; but by how many children she can keep out of prison. Put a price on that.

Our Daughter is a Special Education Teacher and we have a great deal of respect for those that are in that field, not only in keeping children out of prison, which is something we need more of in Honolulu after the recent stabbing of a man in Waikiki by 5 youths, but in our Daughter's case helping those with speech and hearing disabilities.

The legacy comment brings up one of my bitches with respect our Income Tax Policy for inherited wealth. The Income tax on capital gains for real estate and stocks is a sham. I will give this example. If one buys a million dollar piece of real estate or a million dollars in stock and the investment doubles in value in 2 years and then is sold, the owner must pay capital gains on the million dollar captial gain. However, if the owner passes away 2 years later the home or stock is inherited with a step value of 2 million dollars. Therefore, those who inherit that home of investment can sell the home or stock for 2 million dollars and pay NO CAPTIAL GAINS TAX.

 

[Henry M.]

I'd be interested in good arguments for the beliefs of Group 2. I've seen the belief expressed, but not any reasoning of why it is supposed to be fair or workable. I am genuinely interested in hearing perspectives in favor of it, rather than looking to argue.

 

[NiteMaire]

Several topics below...

The thing with property taxes is that a lot of local families already can barely afford to live in Hawaii. Raising property taxes just makes it harder for them to have a roof over their head.

Agree. While the real estate tax (%) is relatively low, income tax is high as well as vehicle registration. When we moved here 3.5 years ago, our AD moved with us. She's considering moving back to the mainland due to the cost of living. She feels like she must live with us in order to afford it, and that's not a good feeling for her.

The real estate taxes don't have to be raised equally on everybody. Already there are different rates for more expensive real estate versus less expensive. The taxes on the more expensive real estate say over $1,000,000 can be raised much more. Also, there is an exemption for owner occupancy of a residence. That exemption can be increased so that owner occupied real estate taxes don't go up at all.

The MEDIAN price of a single-family home on Oahu was $1.15M in April 2022! Raising taxes on $1M homes means raising taxes on more than 50% of homeowners on Oahu. The relatively low real estate tax and mortgage rate are the only reason we could afford the home we purchased. We couldn't afford the same home today with current interest rates (and prices). Higher real estate taxes will simply mean we spend less on local businesses.

What is the average home value for a native Hawaiian and what is the average cost for a new home built in Maui 2022?

I don't know about Maui, but as mentioned above the median price of homes on Oahu is more than $1M. Home prices here are crazy. Several homes in our area recently sold for more than $1K/sq-ft...the highest being $1244/sq-ft. Yes, $1244! A house less than 1500 sq-ft sold for more than $1.8M!

the economic reality is that home ownership isn't in the cards except for high-wage earning families.

Mostly agree; some get by because they live in a multi-family home or they inherit a home. My neighbor 4 doors down has 11 people living in his house (him, his 3 sons, 3 daughters-in-law, and 4 grandkids). While I haven't been in it, it's not a big house.

Building affordable housing instead of multimillion dollar house and condos is another initative that I have very much in favor of.

Even the affordable home program here was criticized here since homes were $1M (IIRC). Affordable for locals? Hardly.

A flat tax on non-Hawaii tourists such as the $50/pp suggested could be seen as affecting the right of a non-Hawaii resident to travel to Hawaii and therefore violate our constitutional right to travel (yes, the U.S. Constitution protects mainlanders' right to travel to Hawaii).

I thought I saw an option of taxing everyone, but allowing HI residents to claim a refund on those taxes when filed.

And I'll keep mentioning it, the family renting out a Ohana or a spare room in order to pay the bills is going to be the first to feel the effects of any anti-AirBnB legislation.

I agree with this. We're adding on to our home since our AS recently moved in with us. We have an option of making it an ADU, Ohana unit, or a "recreational room". We're pursuing the ADU in the event we'd like to rent it in the future. While we have no plans to rent it, we're looking to maximize what we're able to do with the new space if/when he moves.

 

[ScoopKona]

I'd be interested in good arguments for the beliefs of Group 2. I've seen the belief expressed, but not any reasoning of why it is supposed to be fair or workable. I am genuinely interested in hearing perspectives in favor of it, rather than looking to argue.

Having grown up in Key West, I saw first hand what happens when a town gentrifies itself right out of reach of mere mortals. There were a lot of reasons why I left town. But the main, overriding reason was that the town simply wasn't fun anymore. All the interesting people had left -- leaving investors in their place.

Quality of life kept plummeting. And residency (except for investors) was a revolving door of people who said, "I should take this job in Key West! I love it there!"

Six months later, it's, "How does anyone afford to live here? I'm out!"

Since I'm not a cheerleader for any single group in Hawaii, I have plenty to say about locals who gamble away their family's money in Las Vegas. And families who cash out (and gamble) instead of handing down. Much of the island's economic woes are self inflicted.

But if someone is performing useful work -- working the grocery store, cooking, teaching, taking X-rays, driving an ambulance or even taking tourists on manta ray trips -- they deserve to be able to live in their community. A place to stay, enough to eat.*

Minimum wages aren't just for teenagers. When the minimum wage was enacted, the person who signed it into law has this to say about it:

"In my Inaugural I laid down the simple proposition that nobody is going to starve in this country. It seems to me to be equally plain that no business which depends for existence on paying less than living wages to its workers has any right to continue in this country. By business I mean the whole of commerce as well as the whole of industry; by workers I mean all workers, the white collar class as well as the men in overalls; and by living wages I mean more than a bare subsistence level-I mean the wages of decent living."



* Pink Floyd lyric

 

[Henry M.]

I still don't see a good explanation of why the very lowest levels of jobs should pay enough for a person to afford their own housing (without pooling resources with others) and such. FDR expresses a goal, but doesn't justify why that is a good goal to pursue for every single job level. Sure, everyone should be able to have a decent living wage. Everyone should have the opportunity to prosper. However, that doesn't mean every job, even the most menial, should provide such a wage or that there shouldn't be a modicum of effort involved in earning such living wages. He is also not saying what level of work needs to provide the decent living. It is nice to talk in generalities, but the devil is in the details. Relationships have at least 2 participants. The business needs to pay a decent wage for needed work, but the worker needs to provide a reasonably useful work output in order to get that wage. There needs to be some balance in the relationship. It is not simply a matter that if someone performs the most simple job that they will have a decent living wage.

Then there's the definition of what decent living means. Should it include some basic niceties, like cell service, a TV, internet service, a certain amount of square feet per occupant, enough to buy the devices to use the services, the ability for a single wage earner to carry the load for a family of 4 or 5?

I agree gentrification is a problem in many areas. However, that goes beyond a minimum wage. When the median price of a home is over $1 million, no minimum wage is going to provide enough for paying rent or buying a home. They built some "affordable housing" in Lahaina next to Cannery Mall, at over $600K, and now those homes are selling for near $1 million. Even a good professional wage makes it difficult to acquire such property. On the other hand, that is what the open market values the homes at, and there is little that can be done about that without introducing other problems into the local economy.

 

[ScoopKona]

I've already lived someplace where this happened, and the end result isn't pretty.

You know how some people always demand, "Why don't we just raise the minimum wage to $1,000 an hour and everyone can be a millionaire?" As if that is a cogent rebuttal?

We actually do see places where "Why don't we just make all the real estate high end to the point where normal people can't afford to live there." And then we end up with places like Maui. Who is going to mix the drinks, maintain the golf carts and cook food for the ruling class who "deserve" to be there, thanks to Adam Smith's invisible hand?

We can't have a wage scale where everyone makes scads of money. But we also can't have a society where every resident is UHNW and there are no janitors.

 

[Henry M.]

Residents will eventually have to pay whatever it takes to get the services they need. That will make it even more expensive and exclusive to live in the area. It will certainly reduce the load on the environment too, as only a few will be able to afford it.

 

[ScoopKona]

Residents will eventually have to pay whatever it takes to get the services they need. That will make it even more expensive and exclusive to live in the area. It will certainly reduce the load on the environment too, as only a few will be able to afford it.

There is much that can be done. The first thing that can be done is to build low-income housing projects which investors want nothing to do with.

The second thing that can be done is to remove short-term hotel and timeshare units (converting as many as possible into long-term) so that there aren't so many visitors, outnumbering residents.

And the third thing that can be done is to raise minimum wages to a level where someone can afford an inexpensive studio apartment and feed him or herself.

None of those things are being done. And I doubt they will be until Thurston Howell III can't get a Mai Tai.

 

[Tamaradarann]

Several topics below...

Agree. While the real estate tax (%) is relatively low, income tax is high as well as vehicle registration. When we moved here 3.5 years ago, our AD moved with us. She's considering moving back to the mainland due to the cost of living. She feels like she must live with us in order to afford it, and that's not a good feeling for her.

The MEDIAN price of a single-family home on Oahu was $1.15M in April 2022! Raising taxes on $1M homes means raising taxes on more than 50% of homeowners on Oahu. The relatively low real estate tax and mortgage rate are the only reason we could afford the home we purchased. We couldn't afford the same home today with current interest rates (and prices). Higher real estate taxes will simply mean we spend less on local businesses.

I don't know about Maui, but as mentioned above the median price of homes on Oahu is more than $1M. Home prices here are crazy. Several homes in our area recently sold for more than $1K/sq-ft...the highest being $1244/sq-ft. Yes, $1244! A house less than 1500 sq-ft sold for more than $1.8M!

Mostly agree; some get by because they live in a multi-family home or they inherit a home. My neighbor 4 doors down has 11 people living in his house (him, his 3 sons, 3 daughters-in-law, and 4 grandkids). While I haven't been in it, it's not a big house.

Even the affordable home program here was criticized here since homes were $1M (IIRC). Affordable for locals? Hardly.

I thought I saw an option of taxing everyone, but allowing HI residents to claim a refund on those taxes when filed.

I agree with this. We're adding on to our home since our AS recently moved in with us. We have an option of making it an ADU, Ohana unit, or a "recreational room". We're pursuing the ADU in the event we'd like to rent it in the future. While we have no plans to rent it, we're looking to maximize what we're able to do with the new space if/when he moves.

Your not the only one that couldn't afford real estate in Hawaii if the real estate tax was much higher. One of my thoughts that I have is that the low real estate taxes is one of the reasons that so many people can buy real estate here at such high prices and that ability to buy keeps the prices high. I wonder what the prices would be like if the real estate taxes were 10 times as high and now with interest rates at about 7%.

I agree with you that an affordable home program where homes are a million dollars is ridiculous.

 

[ScoopKona]

One of my thoughts that I have is that the low real estate taxes is one of the reasons that so many people can buy real estate here at such high prices and that ability to buy keeps the prices high.

Investors look at the rate of return -- they don't care what the property taxes are on a property which is doubling in value every few years.

Investors also aren't buying properties while undercapitalized. They have the means to pay the taxes, insurance and maintenance to keep their investment in tip-top shape.

Most workers in Hawaii rent. All renters pay property tax. It's cooked into the rent. Jack property taxes, and nobody will be able to afford to live in Hawaii, except multi-millionaires. Counties could jack property taxes, and then offer homestead/affordable housing exemptions to bring them back down for residents. Investors will quickly find a workaround. There is always a way around any financial problem -- providing the person has capital to throw at the problem. The poor can't buy any solutions to their economic problems -- that's why they're poor.

 

[Tamaradarann]

Investors look at the rate of return -- they don't care what the property taxes are on a property which is doubling in value every few years.

Investors also aren't buying properties while undercapitalized. They have the means to pay the taxes, insurance and maintenance to keep their investment in tip-top shape.

Most workers in Hawaii rent. All renters pay property tax. It's cooked into the rent. Jack property taxes, and nobody will be able to afford to live in Hawaii, except multi-millionaires. Counties could jack property taxes, and then offer homestead/affordable housing exemptions to bring them back down for residents. Investors will quickly find a workaround. There is always a way around any financial problem -- providing the person has capital to throw at the problem. The poor can't buy any solutions to their economic problems -- that's why they're poor.

If they raise property tax on non owner occupied property and raise the GET on everything (but exempt unprepared food which is what residents mostly eat) "Think of the things you can do with that money". That is a line from Jesus Christ Superstar but it is relevant here.

If the Government is going to provide assistance to low income people they need sources of money.

 

[ScoopKona]

If they raise property tax on non owner occupied property and raise the GET on everything (but exempt unprepared food which is what residents mostly eat) "Think of the things you can do with that money". That is a line from Jesus Christ Superstar but it is relevant here.

While the GET isn't insignificant, the amount people will save is peanuts compared to rent and home ownership.

You are focusing on pennies and ignoring pounds.

 

[Tamaradarann]

While the GET isn't insignificant, the amount people will save is peanuts compared to rent and home ownership.

You are focusing on pennies and ignoring pounds.

You are supposed to: "Think of the things you can do with that money".

 

[geist1223]

Boy as this drifted from the original Post.