Construction Begins for Villages of Laʻi ʻŌpua Rentals
The Department of Hawaiian Home Lands (DHHL) has broken ground on the vertical construction of 60 homes within the Villages of Laʻi ʻŌpua in Kealakehe for the Department’s second Rent-With-Option-To-Purchase project.
The first 60 homes, a portion of the greater 118-unit Laʻi ʻŌpua Village 4 – Akau, are anticipated to be offered to beneficiaries in mid-2021. An additional 103 Rent-With-Option-To-Purchase units will be built subsequently to complete Laʻi ʻŌpua Village 4 – Akau and the current Laʻi ʻŌpua Village 5.
“A Rent-With-Option-To-Purchase product provides a unique way for beneficiaries to become homeowners with an entry point through an affordable rental,” said Hawaiian Homes Commission Chairman William J. Ailā, Jr. “This portion of the Villages of Laʻi ʻŌpua marks the beginning of several lot initiatives on Hawaiʻi Island. We also anticipate the offering of Vacant Lots in Discovery Harbor and the groundbreaking of our Subsistence Agricultural pilot projects in Honomū and Panaewa in 2021.”
Financing for the project will use, in part, Federal and State low-income housing tax credit equity secured by Hunt Capital Partners, in collaboration with Ikaika ʻOhana and Urban Housing Communities. The project will ultimately provide affordable single-family rental homes for DHHL Undivided Interest (UI) and Waiting List applicants who may convert their rental into a 99-year homestead lease after 15 years.
Coastal Construction Co. is acting as the project’s general contractor with architect firm Design Partner, Inc. ThirtyOne50 Management will function as the rental property manager.
Rental tenants will have the first option to purchase their units after the Federal and State tax credit 15-year rental compliance period ends. Unit sales will comply with the requirements of the Low Income Housing Tax program, as defined in IRC Section 42.
DHHL’s Rent-With-Option-To-Purchase project targets qualifying families who earn up to 30%, 40%, and 60% of the area median income (AMI). This program differs from a Rent-to-Own product, where rent will not contribute to the purchase of the home. Instead, the tenant’s AMI level at the initial qualification to occupy the units will be the same AMI level used in determining the sale price at the end of the 15 years.
Laʻi ʻŌpua UI lessees who meet the household income requirements and other selection criteria will have the first selection opportunity since they currently hold a lease for the Village of Laʻi ʻŌpua subdivision. If rental units are available after the UI’s selection, applicants on DHHL’s Hawaiʻi Island Residential Waiting List will be invited to select a rental unit based on their application date. Other requirements, including household income and selection criteria set by the property management company, will also have to be met.