1. Economic Impact of Home Building Honolulu County, Hawaii
BIA - Hawaii
November 15, 2016
Robert Dietz, Ph.D.
NAHB Chief Economist

2. What is the Economic Impact of Home Building
NAHB impact developed in 1996
More than 800 studies, including for universities and affordable housing groups
2002: adapted for Low-Income Housing Tax Credit rental developments
2005: adapted for remodeling analysis

3. What is the Economic Impact of Home Building?
Study of Honolulu County, Hawaii
Urban Honolulu, MSA consisting of a single county (Honolulu) in Hawaii
100 single-family homes

4. Local Economic Impact of Single-family Home Building
1st - Construction phase
Jobs, Materials, Fees, Taxes
2nd - Ripple effect from construction phase
Wages spent in local economy
3rd - Occupancy phase
Earnings spent in the local economy

5. Assumptions of the Model
Inputs To Model Single-family
Average house price: $522,600
Average raw lot cost: $100,308
Permits/Infrastructure: $12,393
Annual property taxes: $1,549

6. Phase I CONSTRUCTION Value of Construction +
Services Provided at Closing
Permit / Hook-up / Impact Fees
Model of the Local Economy
Local Income, Taxes, & Jobs Supported

7. Single-family Construction – 100 Homes
FIRST YEAR IMPACT:
Single-family Construction – 100 Homes
INCLUDING:
$1.24M permit and impact fees
172 jobs in Construction
42 jobs in Wholesale and Retail Trade
20 jobs in Business and Professional Services
* One job represents enough work to keep one worker employed full-time for a year.

8. Phase II RIPPLE Spending on Locally Produced
Goods and Services
Model of the Local Economy
Local Income and Taxes
from Phase I

9. FIRST YEAR IMPACT: Single-Family Ripple
INCLUDING:
38 jobs in Wholesale and Retail Trade
38 jobs in Local Government
34 jobs in Health, Education and Social Services
21 jobs in Eating and Drinking Places

10. Phase III OCCUPANCY Income of Occupant in New Housing Unit +
Spending on Locally Produced
Goods and Services
Model of the Local Economy
Local Income and Taxes
Income of Occupant in
New Housing Unit +
Increased Property Taxes

11. ONGOING Single-Family
ANNUAL EFFECT
INCLUDING:
$119,800 property tax
18 jobs in Wholesale and Retail Trade
12 jobs in Health, Education and Social Services
10 jobs in Business & Professional Services

12. NEW HOMES REQUIRE Fire and police protection Garbage collection
Parks and recreational opportunities
Roads
Correctional facilities
Primary and secondary education
Etc.
Data: Local and Federal Government

13. Required Current Expenses

14. Required Capital per Unit

15. 100 Single-Family Homes (463 Phase I and II jobs, 80 Phase III jobs)
Net Economic Impact Estimates
100 Single-Family Homes (463 Phase I and II jobs, 80 Phase III jobs)
$14.6 million in revenue; $6.1 million in costs
$8.5 million in net revenue

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