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Landlords face crisis as costs surge and profits vanish

September 04, 2024 | Hawaii County, Hawaii


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Landlords face crisis as costs surge and profits vanish
During a recent government meeting, significant discussions emerged regarding the challenges facing property management and development in the county, particularly in light of increasing demand for housing and rising costs for property owners.

One key speaker highlighted the urgent need for the county to address the influx of new residents purchasing subdivided lots, particularly in areas like Puna. The speaker emphasized that with the growing population, there is an immediate requirement for organized planning and infrastructure to accommodate the new developments. \"The people are coming. They're buying the lots. They're doing the building,\" the speaker noted, stressing that the county must act swiftly to manage this growth effectively.

Another prominent topic was the support for Bill 104, which aims to create a new class of property under tax code laws to assist small investors in maintaining long-term rental agreements. Debbie Heck, a property manager with 46 years of experience, voiced her strong support for the bill, arguing that it would help alleviate the financial burdens faced by small landlords. She detailed her own struggles with skyrocketing insurance and property tax costs, which have significantly eroded her profits. Heck reported a staggering increase in her property taxes from $4,324 in August 2023 to $5,824 in August 2024, alongside a 300% rise in insurance costs for her condo association.

Heck's testimony underscored the broader implications of rising operational costs for property owners who strive to provide affordable housing options. She called for the council to consider setting the tax rate at a residential level for landlords renting to residents, emphasizing that without such support, maintaining properties and providing long-term rentals becomes increasingly untenable.

The discussions at the meeting reflect a critical moment for local governance as it grapples with the dual challenges of accommodating growth while supporting the financial viability of small property owners in the community.

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Scribe from Workplace AI
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