By Rubyjane Buhain-Redila
Guam’s housing market is at a pivotal moment, grappling with challenges of rising costs, limited housing supply and an unprecedented demand driven by military construction projects.
By 2025, Guam will face a demand for 9,908 additional housing units, driven by population growth, pent-up demand and hidden homelessness, according to Fernando Esteves, deputy director of the Guam Housing and Urban Renewal Authority.
Esteves explained that the hidden homeless, such as couch surfers, are distinct from the traditional street homeless. These individuals, who may be staying with family members or not, are people who have no place to stay and cannot afford to live independently, or are unable to find available units within their price range.
Esteves was among the panelists at a recent Guam Industry Forum organized by the Society of American Military Engineers at Dusit Thani Resort on Nov. 14 and 15.
Esteves expanded the discussion to include the broader housing affordability crisis and its far-reaching impacts on Guam.
He explained that overburdened households—those spending more than 30 percent of their gross income on housing— now comprise 52 percent of the island’s population.
The rising construction costs, which currently range from $250 to $341 per square foot, only worsen the affordability gap.
Additionally, the overseas housing allowance given to military personnel has distorted the rental market, driving up prices, and pricing out many middle-class residents.
The concept of the “missing middle” emerged as a focal point of Esteves’s presentation, which he described as moderate-density housing (duplexes, triplexes, and townhomes) targeted at middle-income households earning 80-120 percent of the area’s median income. These households, often falling through the cracks of both subsidized housing programs and high-end market offerings, are at risk of housing insecurity.
“Attainable housing is what we’re trying to focus on for the middle class. Not to be confused with affordable housing,” Esteves said. “But housing that is affordable or reasonably priced for the unsubsidized family.”
He added that there needs to be a “fundamental shift away from rural, single-use zoning —an approach that’s a thing of the past—and move toward transitioning into a more suburban community.”
Guam’s housing challenges stem from its limited land resources, with just 212 square miles divided almost equally among government, military and private ownership.
According to Siska Hutapea, president of Cornerstone Valuation Guam Inc., military land holdings have slightly decreased to 27 percent due to the return of excess federal lands, creating new growth opportunities along critical corridors like Route 3 and Route 13. However, these opportunities are offset by skyrocketing real estate prices and construction costs.
Hutapea noted that the median price for a single-family home has nearly doubled over the last decade, jumping from $213,000 in 2014 to $420,000 in 2024. Land prices have also surged, with a median lot now costing $100,000.
At the same pace, construction costs have more than doubled, from $100 per square foot a decade ago to $200-$250 per square foot. This rapid inflation is driven by the military buildup, which monopolizes construction resources and inflates costs for projects outside military bases.
The rental market tells a similar story. Guam’s apartment units, especially those targeting local residents, are at near-full capacity, with a weighted occupancy rate of 99 percent. The lack of new housing supply has pushed rental rates for a basic two-bedroom unit to around $1,250, while military-subsidized tenants pay an average of $2,450 for similar units.
Workforce housing is a pressing issue for Guam, with the island’s H-2B labor force projected to grow from 5,449 workers today to 12,000 in the coming years. Temporary workforce housing, however, presents unique challenges.
Hutapea emphasized the importance of designing workforce housing as a flexible, transitional solution. “It cannot be a permanent solution to a temporary problem,” she said.
The panel highlighted several critical issues, including:
· Inflation and construction costs: Competition with the Department of Defense for labor and materials has driven up costs, limiting private-sector development.· Regulatory barriers: Lengthy approval processes for rezoning and permits delay critical projects.·Market distortion: Military housing subsidies and high-income renters create a ripple effect that inflates prices across the market.· Limited Land Availability: Despite recent returns of federal land, Guam’s finite resources constrain large-scale development. She recommended developing housing that can be repurposed once the military buildup is completed. Currently, 28 workforce housing facilities on Guam have a combined permitted capacity of 13,096 units, with approximately 8,000 in active use.
However, the development of these facilities faces regulatory hurdles. Temporary housing must be in light industrial zones or zone M1, requiring an eight-month approval process from the Guam Land Use Commission for rezoning if land is not already designated appropriately.
Hutapea urged off-island investors to partner with local experts who understand these complexities to ensure smoother project execution.
Tae Oh, vice president of the Guam Chamber of Commerce, took a broader view of the housing issue, emphasizing the importance of homeownership as a pillar of community stability.
“The situation of the housing crisis is not only a local issue, it’s also a national issue,” Oh said. He added that “housing is more than just an economic indicator—it’s the cornerstone of a thriving community.”
He noted that without affordable housing, Guam risks losing talented individuals. Tae added that escalating costs are putting these opportunities out of reach for younger families and middle-class residents.
Oh advocated for initiatives that expand access to homeownership, including policies that reduce construction costs and promote attainable housing. He stressed the importance of aligning Guam’s housing market with the needs of its residents, warning that a failure to do so could lead to long-term economic and social instability.
Guam’s housing crisis presents a complex challenge that demands collaboration among local, private and federal stakeholders.
The panel highlighted opportunities for innovation and collaboration. These include repurposing temporary workforce housing, developing moderate-density housing for the “missing middle,” and leveraging public-private partnerships to accelerate affordable housing projects.
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