About the Author

Satya Fisher

Satya Fisher was raised on Maui and attended King Kekaulike High School. For college, he attended Virginia Tech where he majored in real estate. Fisher completed an AmeriCorps VISTA service year focused on affordable housing development in rural Virginia. He currently works at Habitat for Humanity New York City and Westchester County as a project manager on the real estate development team.

Hawaii’s system is outdated and needs to be reformed.

Homeownership is deeply ingrained as part of the American Dream.

My parents bought a home in Makawao, upcountry Maui when I was very young. Our small house was in a working-class neighborhood, and we were proud to be homeowners. According to Zillow, our house that originally cost $369,000 in 2003 is currently worth over $750,000, more than doubling in 20 years. 

Today, purchasing the same 1,000-square-foot home on a 6,000 square-foot lot would require a downpayment of over $26,000 and a monthly mortgage over $5,800. With the dream of home ownership seeming out of reach for most people in my generation, a revised dream has emerged: affordable rent.

Even “affordable rent” feels distant as prices for a decent place to live in many places in the United States have skyrocketed. In New York City, the average cost of a 1-bedroom rental is $4,333, in San Francisco, it’s $4,407, and even in historically more affordable cities like Milwaukee, rents are approaching $1,400.

I want to live in a place that I love and feel deeply connected to — a place I call home. But budgeting and finding a place that I can afford is difficult.

Homes located on Maunalani Heights.
Homes located on Maunalani Heights. Security deposits can be difficult to finance. (Cory Lum/Civil Beat/2022)

Even harder is coming up with thousands of dollars for a security deposit before moving in. Security deposits protect landlords’ property from people not paying rent or damaging the property. However, these deposits put additional strain on the overburdened renter. 

Many people struggle to come up with large security deposits and options are limited. Some people can get a loan from family or a bank. Others save up the money over a long period of time.

Security deposits are necessary to protect an owner’s property, but tie up money unnecessarily. The renter has to come up with thousands of dollars, and that money sits in the landlord’s bank account until the end of the lease when, if there is no outstanding balance, the money is returned.

The money that sits in the landlords bank account could be put to better use by the renter to pay for other essentials. The security deposit system is outdated and needs to be reformed. 

Consider Security Deposit Insurance

“Security deposit insurance” solves the problem of renters not having access to thousands of dollars upfront as well as landlords needing a deposit to feel secure.

Security deposit insurance works similarly to other insurance policies. Renters pay a monthly fee, and in the event of property damage or unpaid rent, the insurance company compensates the landlord. 

Companies offering this type of policy have emerged nationwide, especially in high-cost-of-living areas such as San Francisco and New York City. In these areas, rents are high and security deposits can be as high as one- to two-months worth of rent.

With security deposit insurance, monthly premiums can be as low as $15 to $20. That is a cost most renters can afford. Presently, deposit insurance policies are unavailable in Hawaii, despite the high demand and limited housing inventory.

To support affordability and reduce the mass exodus of my generation and our talent out of the Islands, Hawaii needs to take action immediately. Hawaii could be the next place where security deposit insurance plays a crucial role in addressing housing equity issues, ensuring the people from here continue to live here.

Many people struggle to come up with large security deposits and options are limited.

The way to guarantee that all renters in Hawaii have access to security deposit insurance is through passing a law that states landlords must accept this form of deposit.  Cities such as Atlanta and Cincinnati have passed bills that require landlords to accept deposit insurance if the potential tenant chooses to use it. This legal framework could be replicated in Hawaii to remove one of the major barriers to housing.

Although I now live and work on the mainland, my goal is to bring my experience back to Hawaii to effectively tackle the affordable housing crisis that plagues our community.

In partnership with Housing Hawaii’s Future, I authored a policy brief about security deposit insurance that further outlines the need and ways to implement the legislation. To read it, click here.

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About the Author

Satya Fisher

Satya Fisher was raised on Maui and attended King Kekaulike High School. For college, he attended Virginia Tech where he majored in real estate. Fisher completed an AmeriCorps VISTA service year focused on affordable housing development in rural Virginia. He currently works at Habitat for Humanity New York City and Westchester County as a project manager on the real estate development team.


Latest Comments (0)

Isn’t the other side of this topic the 20% down for a mortgage? Everyone in the food chain has a challenge.

Sad_Twin_Voter · 1 month ago

The landlords will have to forgo the interest payments they get from the on-month security deposit and deal with an insurance company. Even if you could get this written into law it would be useless. The extreme shortage in housing units means landlords can simply not lease properties to those who are offering insurance instead of a straight security deposit. If you want to make a difference, start with getting Hawaii to mandate landlords pay the interest on the security deposit back to the tenants, like 17 other states already do. You can borrow against your credit card to finance the one-month security deposit if you don’t have the cash upfront. I will bet that the high interest you pay to your credit card company is still less than the insurance premium you will pay to the insurance company.

under_dog · 1 month ago

Hawaii already caps rental deposits at one month's rent. Which means for most Hawaii landlords, that won't cover ANY significant repairs. It is most often used for cleaning (for tenants who do not or choose not to clean before moving out) with the difference refunded. Landlords can and should carry renters insurance. But as with most things, insurance rates have gone up significantly in recent years. Some have pulled out of Hawaii all together. All that cost gets passed down to renters because not too many people are in the business of losing money. Median price for a Hawaii condo is over $500K. Monthly maintenance fees for many condos are over $1000/month. Add to that mortgage, condo insurance, hurricane insurance, property taxes pest/termite treatments and regular repairs/updates. No one can afford to buy a condo today and rent at an affordable price. If Hawaii wants affordable rentals, then it must build affordable homes. Otherwise, the math just doesn't add up.

Mnemosyne · 1 month ago

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