Top 4 reasons why Hawaii is so expensive? –

We all know that visiting Hawaii is a dream destination for many people, but it can cost a lot of money.

The problem with visiting hawaii is the expense. If you are planning on going to hawaii make sure to check out this guide on how to save money when you go there.

One of the most common questions asked by visitors to Hawaii, especially those coming from the mainland United States are “Why is everything so expensive in Hawaii?”.

Tourists may be surprised to find that things like a gallon of milk or a loaf of bread cost just as much if not more than they would at home. The truth is, there are many reasons why living in Hawaii is far more expensive than elsewhere in the United States.

From state-side goods and services all the way to property costs, practically every aspect of life has an elevated price tag when residing in Hawaii. But why? There are several reasons for this phenomenon; the fact that over 90% of goods must be shipped to Hawaii via boat through very limited ports, the lack of space on each island, and an increased reliance on imported goods are the main factors behind this issue.

Things like fuel can cost more than twice as much in Hawaii compared to the mainland because everything is sent via boat, including fuel. There are only six ports operating in Hawaii where cargo ships can dock; two on Maui, one on Honolulu Harbor (Oahu), one on Port Allen (Big Island), one on Kahului Harbor (Maui), and another at Nawiliwili Bay (Kauai).

This means that nearly every good you purchase will first have to make its way through a ship before it reaches your hands.

With its sandy white beaches, lush vegetation, and spectacular sunsets, it’s not surprising that Hawaii is a prime vacation destination. But while you might yearn to live there all the time, don’t expect it to make the list of best places to live well for under $40,000 a year. Seems living in paradise can be prohibitively expensive. recently ranked the fifty states on cost of living, wages, taxes, unemployment rate, and working conditions—and Hawaii ranked last in terms of best states to make a living.

“One of the realities of an island economy is it is going to be expensive,” says Richard Barrington, senior financial analyst at “Overall, the cost of living in Hawaii is almost 90 percent more than the average cost of living in the United States.”

Housing is more expensive

The biggest overall factor in the cost of living in Hawaii is that there’s a limited amount of real estate. Translation? The cost of housing in Hawaii is about three times what it is generally in the United States.

“That’s a huge multiplier,” Barrington says. “Usually you see numbers like it’s 20 percent higher here, or 5 percent cheaper there.”

And for most people, housing is their biggest expense from month to month.

“So the thing that takes up most of your budget is also the thing that is disproportionately expensive compared to other states,” Barrington says. Pricy housing isn’t only a factor in Hawaii, however. These are the other most expensive cities in the United States.

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Residents have to import many necessities

Another aspect that contributes to the cost of living in Hawaii is that in an island economy, residents have to import almost everything that they consume.

“There’s going to be very little in the way of farming or anything that’s space-intensive,” Barrington says. “You’re going to have to ship a lot of that stuff in.” Those transportation costs are then reflected in the prices. Groceries, for example, are 66 percent more expensive in Hawaii.

This effects not only residents but visitors too. Here’s what you should know before booking your Hawaiian vacation.

The Aloha state doesn’t have a lot of manufacturing either. And typically countries have import and export balances; when imports get too expensive, people go with a less expensive domestic supplier. But Hawaii doesn’t really have that fluidity of choice for consumers to be able to switch between imports and exports, Barrington says.

They’re heavily dependent on imports, from either the mainland United States or another country. Looking for other options? These are the cheapest states to live in the United States.

Utilities are costly

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PHILLIP B. ESPINASSE/SHUTTERSTOCKAfter housing, the most disproportionately expensive cost in Hawaii is utilities. That’s also related to transportation. The Aloha State depends on imported petroleum to generate electricity. That fact and Hawaii’s isolated power grids contribute to the state having the highest power prices in the United States, according to the U.S. Energy Administration.

“Hawaii is not just one place, it’s a fairly far-flung series of islands,” Barrington says. “So another factor that the Energy Administration cites in the high cost of energy there is that the power grids are fairly isolated because of the geography. And that contributes to higher costs.” The cost of living is on the rise–here’s how much your favorite products cost when they were first produced.

So what does that mean for residents of Hawaii? Energy costs are 72 percent higher than the average for the United States, Barrington notes. And that’s despite the fact that in 2017, Hawaii actually had the lowest residential energy consumption in the nation.

Labor is scarce

Finally, another reason the cost of living in Hawaii is so expensive may be circular: labor is scarce and cost of living makes attracting new workers harder.

With an unemployment rate of 2.8 percent, Hawaii is tied for fifth for the lowest rate in the United States. That means that while Hawaii is a good place for job seekers, the high cost of living is barrier. So it’s hard for employers to find competent workers. “”Their unemployment rate is so low and they don’t have that access to neighboring labor pools the way that states on the mainland do.” Barrington says.

A labor shortage hits locations like Hawaii harder than other states. When a state in the mainland United States has low unemployment for an extended period of time, it will start to attract a stream of job seekers from other states.

But not so for Hawaii. “They don’t have that fluidity of the labor force that the mainland would have, Barrington says. The result is competitive salaries, and this cost can get passed along to consumers. “That’s another cost of living factor,” he adds.


Why are prices so high in Hawaii?

Explore the Islands with Hawai'i Tourism Canada - Travelweek

It’s actually far more expensive to be shopping in Hawaii just because of the hidden excise tax incorporated into the listed price itself. People always make the argument that products in the islands are more expensive because of the shipping costs, but the excise tax should not be ignored when considering this.

Is it expensive to live in Hawaii?

Living in Hawaii and Housing Cost. To rent a place in Hawaii is significantly more expensive than in most places on the U.S. mainland. … To be able to afford this rent without paying more than 30% of income on housing, a household has to earn $5,932 per month or $71,184 per year.

Is Hawaii worth moving to?

Although it’s a more complex transition than a relocation on the mainland, moving to Hawaii offers plentiful rewards: beautiful weather year-round, easy access to miles of gorgeous white sand beaches, abundant outdoor activities, and, of course, Hawaii’s unique aloha spirit that infuses the local culture.


Hawaii is known for its lush green landscapes, white sand beaches and crystal clear waters. It’s also home to some of the most expensive real estate in the United States with a median list price of $795,000.

If you are considering buying property on this beautiful island then it pays to do your research before taking that leap into homeownership because there are many reasons why hawaii is so expensive including high costs associated with living expenses like housing prices and taxes as well as utility bills which can be higher than other states due to their dependence on imported oil or natural gas.

This doesn’t mean you should give up hope if these numbers scare you away from purchasing property in this state but rather take time to understand what they mean before.

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