On the surface, the affordability crisis that afflicts both tenants and prospective homebuyers in Hawai’i appears to resemble those of other housing-stressed states across the country. With a shortage of housing units accessible to working-class households, a high concentration of short-term rentals, and a strong demand from wealthy and out-of-state buyers, an increasing number of Hawai’i’s residents are priced out of paradise and forced to migrate outwards in search of cheaper housing.

But there is one element that makes Hawai’i’s housing market unique: the role of the US military. Our chapter in a new report finds that military presence in Hawai’i’s housing market puts an upward pressure on rental prices that freezes out locals. We estimate that troops in the private market raised housing prices by 7.1% in 2024.

Hawai’i is the most militarized state per capita in our nation. Not only does it have a high concentration of service members, but more than 230,000 acres of land out of the 4.1 million in the island chain are currently under military control.

A dense network of military bases is conspicuously scattered across the eight islands. And almost a quarter of the state’s most populous island, O’ahu—home to Honolulu and Kailua—is currently under what local activists and groups call a military occupation, contributing to land shortages and higher land prices that make real estate development even more expensive.

To help alleviate the inflationary impacts of military rental demand on the Hawai’i’s housing market, our report recommends that all active-duty service members be housed on base.

More than 98% of the 42,503 active-duty service members in Hawai’i were stationed in O’ahu in the summer of 2024. But not all of them lived on base. According to the Department of Defense, there were 14,700 active-duty service members who entered the private rental market. We estimate that they resided in 10.3% of the 142,130 renter-occupied units in Honolulu County.

Not only does the military have a significant presence in O’ahu’s rental market, but it also contributes to upward pressures on Hawai’i’s housing prices because of the tax-free stipends—known as Basic Allowance for Housing or BAH—that active-duty service members receive on a monthly basis.

Local residents have difficulty competing with compensation packages bolstered by BAH payments, making military renters more attractive to landlords.

An E5 Sergeant, a rank of enlisted personnel who have been promoted to lead a small team or section, with dependents and four years experience, had a base pay of $40,388 and a BAH of $39,852 in 2024 for a total of $80,240. This is $10,000 more than the average........

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