Developers, encouraged by strong housing prices, plan to build roughly 60,000 new homes on O'ahu over the next two decades, according to a city survey and Advertiser estimates.

The expansion — adding the equivalent of a new Mililani, Hawai'i Kai, Wahiawa, Kailua and Kane'ohe combined — comes with benefits and drawbacks. It's good for the economy, jobs and families pursuing the American Dream of homeownership. But it's often bad for open spaces, commuters frustrated by increasingly congested traffic and children attending overcrowded schools.

"Are we to become like Los Angeles?" asked Hank Higuchi, a Pearl City resident of 56 years. "I really can't see how our infrastructure can handle it."

The projects could mean significant impacts on O'ahu residents already facing congested freeways, crowded schools and rising fees for infrastructure such as sewer lines.

Whether developers will be able to follow through on their plans depends on market conditions, but the prospect of so many new homes is jarring to many.

Kathleen Kaiser, a longtime resident who has owned a condominium in Waipi'o Gentry since 1998, is dejected by residential sprawl into more of Central and Leeward O'ahu where city planners have directed urban growth.

"It does not work on an island with a finite availability of land," she said. "I believe we are now at the tipping point of overdevelopment."

Still, as families grow, so do housing needs, especially for affordable housing that the city mandates for many new communities. There are enough people who support the growth and enough jobs dependent on it that limiting expansion is not considered an option by most lawmakers.

"You cannot stop growth," said state Rep. Michael Kahikina, D-44th (Nanakuli, Honokai Hale) House Housing Committee chairman. "People are still going to make babies."

Kahikina said he wants to see more workforce housing and smart-growth projects designed to minimize traffic increases, but controls on building do not make sense.

Whether people favor or oppose housing growth, the marketplace and regulatory constraints will largely dictate how many homes are built and how fast.

STRONG DEMAND

Over the past several years, O'ahu experienced an unprecedented housing expansion cycle with stratospheric price increases and sustained demand that recently has slowed but remains relatively strong.

The market, in turn, spurred developers to rekindle stalled plans, speed up construction of ongoing projects and propose a slate of new communities.

These plans have pumped up the development pipeline enough to potentially spew a flood of new residences throughout urban, suburban and rural communities.

Most of the development is concentrated among urban Ho-nolulu high-rises and massive master-planned communities of detached homes and townhomes in Central and Leeward O'ahu.

Advertiser calculations and city Department of Planning and Permitting's August 2005 survey show that developers could deliver about 5,500 homes both in 2008 and in 2009, after fewer than 4,000 estimated homes this year and next year.

By contrast, an average of 3,430 homes per year were added on O'ahu between 1990 and 2000 — 54 percent of it in Central and 'Ewa regions, according to the city.

The market may put the brakes on some of that construction. Sales of existing homes have slowed since late last year, in part because rising prices and interest rates are putting homes out of reach for more and more buyers.

Economists forecast that home prices will continue to rise, albeit only slightly, through 2007. If that is true, it follows that demand will continue to decline.

That could deter builders from delivering as many homes as they'd like.

"There's been a tremendous amount of permitting activity (to build homes) in the last few years," said Carl Bonham, a University of Hawai'i economist. "Something's not going to get built. I think the peak is here."

Other industry observers also predict that many of the homes slated for delivery in the next few years will be delayed, and that the homebuilding "boom" is over.

HOMEBUILDING PEAK

Paul Brewbaker, chief economist for Bank of Hawaii, forecasts a slowdown in home construction starting next year and running through at least 2010.

"We're right at the peak for homebuilding," he said.

Brewbaker noted that the peak — expected to be under 4,000 homes this year — is lower than what it was in almost every year from about 1960 through the mid-1990s.

If the construction does slow, that's not terrible news for residents frustrated about transportation infrastructure and schools failing to keep pace with new subdivisions, and for people dismayed about former sugar cane fields being gobbled up for housing.

One major advantage to rapid new-home construction is that it can lead to lower prices, but the pace of building on O'ahu is not expected to boost supply enough to take pressure off prices in the near term.

Brewbaker notes that even if developers build 5,000 homes a year, it would be the equivalent of a roughly 1 percent increase to supply. "It's next to nothing," he said.

The city's most recent housing growth projection, made last year, is for 1 percent annual growth, or about 3,000 homes a year from 2000 to 2010, and then about 4,000 a year from 2010 to 2030. Updated projections won't be available until later this year.

Developers typically try to alter production to match demand, so it's difficult to say exactly how many homes will get built.

"I don't think developers are going to push the envelope too hard," said Mike Jones, president of D.R. Horton's local Schuler Division. "We've all been through the bloodbath (when Hawai'i's housing market crashed in the early 1990s)."

Large projects dependent on government approvals also can be delayed by the permit process, creating more uncertainty as to whether developer plans will be realized.

Of the nearly 60,000 homes slated for development in the next two decades, at least 25,000 need major government approvals such as zoning changes, including Castle & Cooke's Koa Ridge near Mililani and Schuler's Ho'opili on the 'Ewa Plain.

Many of the planned homes, however, are within already authorized and ongoing projects such as Ewa by Gentry, Haseko Hawaii's Ocean Pointe and numerous high-rise condos.

Residents can voice their concerns about development and the planning process by attending community meetings to begin in October.

A task force created last year by the state Legislature plans a series of meetings and studies to examine how much land development, water use and population Hawai'i can support. The Hawai'i 2050 Sustainability Task Force also plans to address other quality-of-life issues as development increases.

Reach Andrew Gomes at agomes@honoluluadvertiser.com.