Hawaii is an island paradise where people live and work every day. For those who aren’t there to vacation, is it a really expensive place to live?
Crystal blue water, beautiful volcanoes and the Aloha spirit make Hawaii a truly unique location to call home. No matter which island you’re on, the natural beauty and culture of Hawaii are everywhere, but does all that come with too high a cost?
Figuring out the cost of living in Hawaii means taking into account a variety of factors. Think of them as the line items you’d have on your monthly budget list. When you look at real prices, can you afford to live in this tropical paradise?
These key areas of everyday life may help give you a better idea of whether Hawaii fits into your budget.
Hawaii housing prices
One of the best state capitals in the U.S. to call home, Honolulu is a perfect example of what island living can provide. It’s also indicative of how much housing in paradise can cost. Overall, the cost of living for housing in Hawaii is 120.7 percent above the national average. That puts rent prices up much higher, as well, and they continue to increase.
A one-bedroom apartment in Honolulu costs an average of $3,280 per month, up 57 percent over last year. That may seem steep, but a two-bedroom, at an average price of $5,230 per month, has risen 149 percent over last year.
Housing prices aren’t escalating at such an extreme as rentals, though. In Honolulu, the median home price is $542,500 and has only risen by 5.6 percent over last year.
Food prices
Throughout Hawaii, the average resident spends at least $333 per month on food. This includes ingredients for island favorites like Loco Moco — white rice topped with hamburger, a fried egg and brown gravy — and poi, which is a root vegetable similar to a sweet potato.
This overall spending may seem expensive to many, and food does have higher costs in Hawaii than in many places on the mainland.
In Honolulu, the overall price for food is 52.7 percent above the national average. The average price for specific grocery items that might be on your shopping list looks like this:
- Eggs: $3.97
- Ground beef: $5.69
- Potatoes: $9.17
- Bananas: $1.22
- Steak: $19.39
Food is also costly when it comes to that special date night meal. A three-course meal for two in Honolulu is $95 on average. So, if you’re planning a date night, make sure to make it special. Try Duke’s Waikiki for beachside seafood, Ginza Bairin for Asian or Rigo for Spanish Italian fare.
Utility prices
Although most homes in Hawaii don’t have air conditioning, there are still utility bills to pay. Temperatures are often tolerable, and many homes have good ventilation, making this portion of your total cost of living not as high as others.
Overall, Honolulu utility prices are 44.6 percent above the national average. Most of this cost goes to electricity. Currently, Hawaii doesn’t use alternate energy options to help power its homes and offices but does plan to have all-electric energy come from renewable sources by 2045.
For now, the average electric bill in Honolulu is $317.88 per month as a result. Other utilities break down with these monthly averages:
- Internet: $45
- Water and sewer: $57
- Cable: $45
- Natural gas: $122
Combining all of these individual utilities together, your average total utility bill ends up being almost $587.
Transportation prices
Honolulu’s transportation prices also aren’t that much higher than the rest of the country. At 24.2 percent above the national average, you may not feel the pinch too much. There are also opportunities to supplement the cost of owning a car with public transportation.
In addition to being both walkable and bike-friendly (a 74 walk score and 60 bike score), Honolulu is part of the massive public transportation system that encompasses all of Oahu. The Bus is one of the best transit systems in the world. It has plenty of routes, but not all run every day, so knowing the schedule is key.
A one-way fare is $2.75 around the island, but the most cost-efficient way to ride The Bus is with a HOLO card. This gives you the benefit of a “fat cap,” which means you can’t get charged any additional fares within a 2.5-hour period, once you hit the max. The fat cap per day is $5.50. The HOLO card fee is $2.
The Bus also sells monthly passes for $70.
Healthcare prices
Your specific overall healthcare costs are dependent on a variety of variables, making it hard to really calculate what you’ll need to spend on this budget item. One way to get some idea, though, is to look at average costs in your area. That provides you with a baseline when crafting your budget.
When looking at Honolulu, overall healthcare prices are 20.1 percent over the national average. That impacts things like doctor’s visits and prescription drug costs.
This leads to an average visit to the doctor costing $162.96. That bi-yearly visit to the dentist costs, on average, $95.20. A year’s worth of prescription medications are costing that average Honolulu resident $528.75
Goods and services
Looking at the cost of living in Hawaii for goods and services, the non-essential items you work into your budget each month, Honolulu is only 27.6 percent above the national average. This above-average pricing is a result of the extremely high levels of tourism the state experiences. In 2019, a total of 10,424,995 visitors came to Hawaii, and although numbers took a dip at the height of COVID, the numbers are continuing to rise — there were 6,777,498 visitors in 2021 and nearly 2 million in the first quarter of 2022.
Whatever the reason the average is high, it’s best to price out the individual services you use more regularly to accurately plan your budget. In Honolulu, some basics include:
- Taking a yoga class, which costs $22.20 on average
- Going to the movies, which costs $14.50 on average
- Visiting the hair salon, which costs $73.80 on average
- Getting a simple haircut, which costs $17.36 on average
There are other expenses that fit into this category, as well, like shopping for clothes, having a newspaper subscription and getting items dry cleaned. Another expense that often leaves people with some sticker shock is childcare. While you may not need to budget this particular expense now, the cost of a private, full-day preschool in Honolulu is $900 a month. That’s pretty expensive (though not nearly as much as it could be).
Taxes in Hawaii
In Hawaii, there’s no state sales tax. Instead, there’s a 4 percent excise tax, known as the GET. This is a tax on all business activities. This tax affects the business owner, and not the customer, although most will factor in this tax to the price of their goods or services, so the customer does ultimately end up paying it.
Local municipalities do have the ability to add to the GET. Honolulu does, raising it only slightly to 4.5 percent.
Since this tax is almost always transferred onto the consumers, assume that for every $1,000 you spend shopping, $45 of that is actually going straight to the GET tax.
How much do I need to earn to live in Hawaii?
One way to calculate how much you really need to make to live in Hawaii is to make sure you have enough income each month to cover rent and necessities. This often doesn’t include all those goods and services, but rather the basics — food and shelter.
Since rent will take the biggest chunk, calculating how much you need in that area is a great place to start. In Hawaii, the average two-bedroom rent is $3,431, and most experts say rent should make up no more than 30 percent of your annual income. Doing the math, you’d need to make a minimum salary of $137,240 to live in a place that big.
Although Honolulu is much more expensive than other Hawaiian cities, like Hana on Maui or Waimalu on Oahu, the median household income across the state is $83,102. That means, if you want a two-bed, you may need to consider finding a roommate.
To get accurate numbers for your own budget, use our rent calculator.
Living in Hawaii
Paradise definitely comes with a price, as the cost of living in Hawaii is well above the national average. But understanding that from the start can make your search to find the perfect Hawaiian home run smoothly. Whether that means settling in Honolulu or another city, or even on another island, those blue waters and beautiful weather will constantly remind you that you’re in your ideal living environment.
The Cost of Living Index comes from coli.org.
The rent information included in this summary is based on a calculation of multifamily rental property inventory on Rent. as of June 2022.
Rent prices are for illustrative purposes only. This information does not constitute a pricing guarantee or financial advice related to the rental market.
Source: rent.com