If you think Hawaii vacations are expensive now, here’s what could happen if Senate Bill 2919 passes.
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If you think Hawaii vacations are expensive now, here’s what could happen if Senate Bill 2919 passes.
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What happens to deeded timeshares? Mahalo
What happens to deeded timeshare owners… Mahalo
No problem. If government is left unchecked everyone will have somewhere to live but won’t have a job. All tourists are not filthy rich
It’s funny……County authorizes B & B’s/Short term rentals in neighborhoods…and now they want to take it away from those that were permitted. I never liked the idea of having those in residential neighborhoods. But those who applied for and followed the county regulations paid for the right to do it….So here we are…Should have Never allowed it in the first place…it’s not zoned for it. But it was good when the tax monies from these properties came in, right?. So who is actually at fault here….those who were made to believe you can do it? or the government ?
You are confusing a number of completely separate issues.
The county of Honolulu lost a court case brought by home owners that objected to an ordinance that would have disallowed 30+ day rentals and would have changed decades old law to a minimum lease of 90 days.
The county lost in federal court, and the state is trying to get around this loss for all future owners that want to lease their properties for 30 days to 90 days. Existing owners that were exercising their right to rent for 30+ days, won’t lose that ‘right’.
The new state law also does not address the existing 1989 NUCs (BnBs).
Every Island is different when it comes to Permits. Oahu has not issued new permits since 1989. There are roughly 8,000 to 10,000 STR advertised on Oahu at any given time, while there are approximately 800 Permits. Many are located in residental area that are not zoned for STR. Without a Permit, it isn’t so easy for the county to collect the taxes owed and unfortunately neither Airbnb or VRBO are willing to identify the location of the property.
I visit Kauai twice a year for two weeks and prefer a cono with full kitchen. The prices have gone up steeply with no change in state improvements in traffic or services. I may go somewhere else if this continues/
Aloha Rob+Jeff I would not be able to visit Kauai if the STR’s get more expensive. They already are more than double what they were just a few years ago. Tourists are able to enjoy the benefits of staying in a rental more than staying at a hotel where you are charged for everything even if you don’t use them. Resort fees, parking, etc. I doubt that the locals would like living in resort areas also. They would prefer neighborhood housing.
Let’s be serious and logical here. Shot-term rentals are not the major problem they are made out to be (I don’t use them myself). The problem of housing people in HI is not the ‘availability’ of these homes/condos for rent/purchase by those in need of housing, it’s the ‘affordability’ of those homes, ether to rent or to purchase. Who of those seeking housing can afford (there’s that word again!) to rent a home that would sell for 1 million+ (typical in HI), much less try to buy one??? I’d say about 99.9% would not. These short-term rentals aren’t being rented out for $700/week, or even double that. How many of the typical low-paid working class could afford that??? Affordability, folks, not just availability.
Maybe we should consider options like only allowing short term rental permits to be issued to people on the Hawaiian Homelands list. Possibly expand it to people with generational ties to the islands. Then it wouldn’t be mainland people exploiting our housing to rent to other mainland people.
Basically, you are suggesting a hidden, but still artificial, means of destroying the market for condos in order to bring the cost down low enough for locals to purchase. Those sorts of manipulations never work. They require an ongoing supply of money to keep the prices artificially low — those who own the property through price manipulation cannot afford the maintenance and upkeep of these condo buildings (they pay up to $2500 a month at many of these buildings, just to keep them running). Do you know how the new owner of this condo can afford it? By renting to tourists for $800/night.
When the 30 day minimum law passed on Oahu, many STR in my area went back to long term rentals and all were filled immediately. There aren’t a lot of long term rentals on the Island but when available, they don’t sit vacant for long. If STR aren’t allowed in residental areas, rent will have to go down or the property will sit empty.
The 30-day law has been in effect on Oahu for decades. So are you saying many units became long-term rentals decades ago?
So much less inclined because it was the rentals that made the trip somewhat affordable. A hotel (with parking and resort fees) would cost for a week what a rental was for a month. We prefer not to be in the commotion of “tourist areas” and the rentals provided that. I agree with “Boston” that flight time figures into the equation as well (and connections out of Ohio easily make for a 16-hour flight day). We used to come every year but now we just say “they don’t want us.”
Since the governor is in Japan courting “mindful” visitors I guess he doesn’t think I’m mindful. My husband and I have traveled to the Hawaiian islands for 35 years sometimes three times per year. We can’t even come close to saving that much per year. This year was $15,000 /mo with kitchen, and it’s my last year. Groceries and dinners are way way expensive. Aloha Hawaii God bless her people.
I lease minimum 30 days, because my flight is 11 hours. I would not return if this option is taken away.
We have visited Hawaii many times and have stayed in both hotels, timeshares and vacation rentals. We prefer the vacation rentals. Hotel rates are completely absurd and timeshares are hard to get.
In the end we will always consider our “bang for the buck” in making our vacation choices. I am sitting in New Zealand as I write this where there are no shortage of Airbnb’s that are less expensive than most of the alternatives in Hawaii. My airfare to NZ was on par with a general ticket to Hawaii. So, other than an additional few hours of flying, there are not a whole lot of reasons for us to go to Hawaii when there are Soooooo many other places that offer a better “bang for the buck”.
If short term rentals are not wanted in Hawaii, we will go elsewhere. We don’t care for spending 10-14 days in hotels. As it is clear Hawaii doesn’t really want tourists….we get the message. Btw we have used short term rentals in Hawaii for 30yrs.
Speculation is flying rampant, and many of the comments I read are inaccurate interpretations of 2919.
The ability of counties to regulate STVR leaves the judgment closer to home, and local county counsels are more sensitive to the needs and opinions of residents.
Importantly, passage of this and other regulatory bills will not affect timeshare owners and those who operate an STVR in resort zones. These are popular tourist locations well away from most residential neighborhoods.
However, I am all in favor of allowing legal hosted rentals while eliminating the growing trend of non-resident STVR rentals. Governor Green’s noting that 27% of STVR owners own 20 or more properties. That stat. is backed by both the HTA and UHERO.
Again. Please read the article and try to understand the 2919 bill:
It is Not intended to address STRs.
The county lost a federal law suit, because it tried to pass an ordinance that disallowed decades old rentals of 30+ days. The county wanted to make the minimum rental period, 90 days. The county lost because
The state currently defines minimum legal rentals to be 30+ days. This is legal state residential zoning.
The state is trying to remove that decades old law to allow counties to change their residential zoning to circumvent the 30+ right.
so are you saying that every STR that is less than 30days is already illegal? If that’s true, there are a lot of people that are going to be in for a huge shock!
Wow! Good researching and catch. Someone should tell the Mayor, Governor, and many of the people testifying at short-term rental related legislative sessions to stop spouting the misquoted statistic.
I wonder what the real percentage is of short-term owners with more than 1 or 2 properties in Hawaii? I bet it’s minimal.
RichardW,
No, that is not what I said or meant. There are a number of reasons in Honolulu County where a sub-30 day rental is legal; in the tourist zones, and where the lease holder has a 1989 NUC are two such examples.
And I didn’t say anything about less-than-30 rentals [refer to the logical fallacy “denying the antecedent”].
I simply said that all 30+ day residential rentals are and have been legal for decades, and will continue to be legal until the state government allows counties to change the Land Use Ordinances.
Vacation rentals as a category are not in danger of being eliminated across the board, that’s silly. I’m a vacation rental manager and on Kauai, we have been regulated for nearly 15 years, with designated visitor areas where vacation rental activity is permitted, and residential areas where it is not permitted. Vacation rentals do not need to infiltrate every residential neighborhood, and in fact when they do so, the result is a shortage of affordable housing for permanent residents. I have no concern that legally operating rentals located in designated visitor areas will be shut down, and I think other islands following in Kauai’s footsteps to impose some checks on vacation rental proliferation is a net positive.
If my only choice were a hotel, I would likely not visit. You have 2 to 3 meals out per day plus the cost of any activities to include as well as the hotel charge. I might spend more for a condo if needed.
Aloha Rob+Jeff I would not be able to visit Kauai if the STR’s get more expensive. They already are more than double what they were just a few years ago. Tourists are able to enjoy the benefits of staying in a rental more than staying at a hotel where you are charged for everything even if you don’t use them. Resort fees, parking, etc. I doubt that the locals would like living in resort areas also. They would prefer neighborhood housing. Do you rent or own?
If short term rentals disappear, so will I. I have gone to Hawaii several times but don’t want to stay in hotels and pay for services I won’t use.
So sad to think I may not be able to go back .
Aloha!
This article is not about ‘short term rentals’.
Since we have a Timeshare, that’s what we use yearly to visit, so the reduction/elimination of STRs wouldn’t bother us, nor would it change how often we come to Hawaii. As for the problem itself, my opinion from visiting Hawaii is that it’s overrun by tourists right now. Seeing the sights, going to the beaches, and trying to get into the restaurants is a challenge. Something has to be done, and reducing the number of STRs might help. It’s a complex problem, with no easy/painless answers.
I almost always stay in short term rentals when vacationing, with little desire to stay in a hotel and would definitely be less inclined to visit if that was my only option or rentals became too expensive. That being said… Unfortunately, the vacation rental I generally stay at annually on Kauai has nearly doubled in price in the just the last few years..sadly, causing me to pause and consider other future vacation destinations.
So, the governor is flying to Japan to influence them to come to Hawaii. Is the governor just going tell them they can’t stay in STRs, just in hotels??? If you’r from the mainland please don’t come, we need the space for the Japanese.
If this legislation passes, I won’t be retuning to Hawaii. For 18 years my family has vacationed on several islands and stayed for 10 days each. Prices are now out of control. I can only imagine what would be the charge and cost of long term rentals. The economy is suffering, especially in Maui and you’re making it worse.
As a long time, local legal short term, vacation renter, I can’t understand why they want to delete short term vacation rentals other than having the hotels make an excessive amount of money which they do already, and limiting stays to the Rich famous because of the blue-collar people will not be able to afford to stay in hotels, another point if Green thinks opening up, vacation rentals for locals is going to work, how is a local waitress, bartender store worker, or even Professional going to afford to buy any of these vacation rentals price that 600 to 800 k! With the eviction problems, and people not paying rent, myself as a local landlord, who lives on the big island will be forced to sell, Not willing to have my home trashed😡
isnt the answer simple? The argument is that too many people dont have a home after the Lahina fire (not that homelessness wasn’t a problem before the fire) so the “solution” is to convert STR in residential areas into LTR)
I have STR and LTR around the country. I worry far less about the LTR (since those people put down a decent security deposit and would have to live with the damage they may cause) than the STR (since those people dont really treat the unit with as much care since they are on “vacation”.
I own a licensed vacation rental on Kauai island in a non designated vacation rental area. The percentage of property taxes I pay is substantially higher than what Kauai residents pay, and my guests pay a State GE and TAT tax, and an additional Kauai TAT tax.
I live in California. We have experienced the same rental issues we see in Hawaii. The people who work for the municipality (Teachers, Fire, Police, Park Service, etc.) cannot afford to live where they work. In Cali, this creates a bit of an infrastructure sensitivity vacuum. The best workers are the people who are civilly invested in the place where they live.
So what to do? Perhaps give incentives to build granny suites on single family lots. Carrots are far better!
If FEMA stops funding can the renter be evicted under the Hawaii eviction moratorium?
It is unlikely the renter will be able to pay the rent FEMA is currently paying, and there may not be affordable homes either.
1) The building crisis and bottleneck lands squarely on the permitting process and the very finger that the Governor is pointing should be aimed directly at the Counties’ respective leadership.
2) Gutting STR/LTR that subsidize the Nation’s lowest property tax, aka “owner occupied” for those that of us that live here. Question is, then what?
3) This state and government needs to take accountability for their own actions and do so immediately.
How’s the train working out?
Thank you for your perceptiveness.
You correctly see what will happen if the revenue from STRs is drastically curtailed. Is it believed that the government will just resign themselves to a huge budgetary haircut? Where do residents think the government will turn to make up this drastic shortfall?
You are very wise to see the answers to these questions, even though it is you who are currently benefitting from the low tax rate. Kudos to you!
We have friends who have owned a condo in Kihie for over 30 years. Other than 4 weeks a year, it been rented out/booked by short term renters during that 30 years. Do they run the risk of getting caught up in this nonsense even though they have been doing short term rentals all this time?
The price of hotels on Maui is obscene. As much as I love it and have been visiting since the 70’s to see whales in the winter, I would not return without being able to a rent a condo. Those are still expensive, but half the cost of a hotel.
If vacation rentals become obsolete, so will I. I visit Kauai every winter for 9-10 weeks. Besides the $18,000 I spend for accomodation, I also contribute about $10,000 into the County money bag. I could never afford any hotel room and dining out every meal for even a few weeks. For someone who has been visiting since 1975, I take offense in the ‘blame tourists’ for everything.
Hi John
You are absolutely right! Government is the ones to blame. Permit process is also to blame…Listening to small groups of people is to blame. I have clients that love coming to the units I manage. I am a local born and raised and have seen so much lack from the government in accommodating the proper infrastructure and homes.
Now we have a disaster like Lahaina and its all the tourist and out of State owners fault . Well staycations for the locals will be just as hard …..
We love our Hawaii timeshare.
Most definitely we would never return if it meant staying in a hotel.
I don’t believe that Timeshares would be covered under this, or am I wrong about that? I think that what they are “after” is the AirB&B/VRBO kind of STRs. Keep in mind that Timeshares are owned, not an STR.
We hate hotels. If we can’t have at least a small kitchen (so that we don’t have to eat out all of the time), we probably won’t be taking anymore vacations in Hawai’i. We’ve been visiting for at least 35 years.
Buy a Timeshare, that would solve your problem. They really were the alternative to “high” hotel prices in the past. Not that they don’t have their own issues associated with them.
I have been going to the islands, primarily Maui, Big Island and Kauai, for decades. Early on it was hotels, then as the family grew, we moved to vacation rentals. We now like vacation rentals for flexibility they provide. As empty nesters, we don’t need all of the hotel amenities and we can tailor our stay close to where we want to be. We are crushed about Maui and Lahaina and fully understand the need to provide housing for those who have been displaced and those who are priced out of the market. We have also seen the urbanization of Kauai which is very disappointing. So, combine short vacation rentals with exorbitant hotel rates, and likely higher air fares, and you good incentive to head farther west or the Caribbean. Aloha
It’s worth noting the difference between hosted vacation rentals and unhosted. Those who live and work in Hawaii and earn additional income by renting out a room or ‘ohana unit are not the folks being targeted here. Folks who live off-island, buy one or more homes to rent them out are the primary targets, and deservedly so. They’re driving up housing prices and depleting available housing for locals.
Something is confusing me; perhaps someone here knows the answer.
The 2nd paragraph of HB1838, a companion bill to SB2919 recently dealt with in the House, says:
“ The legislature further finds that while nonconforming uses in industrial, commercial, resort, and apartment zones may be eliminated or phased out over a period of time when nonconforming uses are discontinued via county ordinance, no such allowance is given in areas zoned for residential use.”
So HB1838 only seems to be addressing Residential zones.
Am I reading this right that short-term rental use in industrial, commercial, resort, and apartment (e.g. Minatoya) zones can *already* be discontinued via county ordinance?
Maui will no longer be affordable for middle-class tourists if this problem can’t be solved. If the cost of a Hawaiian vacation continues to rise, even the upper class will go elsewhere. That would be devastating to the local economy if both groups are alienated.
I have been contemplating a month-long stay in Honolulu. This would change my plans.
Definitely less inclined. Hotel prices are out of reach for us. If hotels were the only option, we would not visit. The price of hotels, on top of skyrocketing airline and rental car prices, is making the Caribbean, Costa Rica, and Mexico look a whole lot better.
The article states “When many travel to Hawaii, they like the idea of a vacation rental with a kitchen, living room, and separate bedroom. It provides the feeling of having a more local experience.”
I disagree. It’s got little to do with the local experience, and more to do with being able to afford room for a 4 person family. Have you checked the ridiculous hotel rates in Poipu, or anywhere else for that matter? VRBO rentals probably cost close to the same as the hotels, but you get a lot more space as well as a kitchen to cook food in.
I guess the kind of “mindfull visitors” gov Green are courting, are not those “mindful” of the outright and blatant surcharge hotels, restaraunts, golf courses etc inflict upon the visitors!
I charge 259 per night for a three bedroom, two bath, beautiful short term, vacation rental, hardly even close to the cost of a hotel room which ranges from $700-$1200 per night, it’s a no-brainer for most people to stay in a VRBO Unless they’ve got too much money to blow
I prefer to stay in a vacation rental. It’s so nice to have a kitchen, and it often gives me the opportunity to meet the locals and learn about non-touristy things to do (and eat).
But you definitely get more bang for your buck in a vacay rental.
Would still be going to Hawaii every year . Own timeshares which or not considered vacation rentals . Only stayed in Hotels 2-3x over 20 years ; preferred a resort timeshare ( apt) .
My wife and I owned a condo in Kihei from 2002 to 2016. We sold and moved to the mainland as we were priced out of paradise. At the time we said we’d simply return each year to get our Maui fix. Now it’s every two years because of the expense, and if we had to stay in the hotels in south Maui, well we’d simply go on a cruise. I attended college on Oahu and have a love for Hawaii that most can not understand, but the Maui and Hawaii of today is quickly becoming unaffordable and unrecognizable.
I don’t understand the complaint that short-term rental units have depleted the availability of rental housing for locals. It my guess that most of this housing in the form of condos and townhouses or expensive vacation homes were built to sell as second vacation homes that were turned into short-term rentals. These rentals bring visitors who spend money and provide jobs and income for locals. Without the income/jobs–how could a local afford to rent a condo in kaanapali or kihei anyway? The Hawaiian govt. seems to have gone crazy with this idea that visitors are evil and they should just send checks (federal funds) but stay home. There is a housing shortage in Hawaii but there’s a housing shortage in most of the US. Built more
As far as turning my house over to long-term Vacation Rental, several years ago, I read an article in West Hawaii Today concerning a landlord, trying to evict tenants that have not paid rent for three months also trashing the house. In this article, it stated that Big Island sheriffs will not carry out eviction notices. Therefore the landlord had to hire two sheriffs from Maui to fly over to serve eviction papers and it cost the landlord $10,000 to have the tenant served after they’ve trashed the house and not paid rent for three months, I intend to sell at today’s market value rather than rent and have my home that I work so hard for trashed, so much for the governors idea of turning STVR’s to local rentals
On Maui, 27,000 out of 73,000 housing units is a short-term rental. You don’t think having over 1 out of every 3 homes (37%!) as a short-term rental has any impact on rental and home prices?
Much of the data regarding vacation rentals is just plain wrong. The idea that returning vacation rentals to the long-term rental market to improve housing stock is a lie. It won’t reduce prices, and the county will be faced with lawsuits if they force homeowners move to long-term rentals. Who is going to make up the financial shortfall? Owners don’t want to be landlords, they will sell, and those will sell at market rate not some discounted price.
The prop of short-term rental income is what’s driving home prices higher. Once you remove that, the “market rate” for housing is a Lot lower. Also note that AirBnB has never been through a recession, so once that hits, this problem will likely correct itself through defaults and foreclosures.
This has not happened in other resort and visitor-centric communities with a significant amount of short-term rentals. In those communities, when short-term rentals were banned, property values went down temporarily by an average of 1-3%, which was quickly erased the following year due to inflation.
The slight reduction in prices was hardly “a lot lower”. Eager, hopeful buyers-to-be in those areas were a bit disappointed.
Uh, the news begs to differ: ktla.com/news/california/palm-springs-home-values-in-free-fall-after-city-cracks-down-on-airbnb/
As I said elsewhere in this thread, it depends when and what you read. Palms Springs real estate bounced back this year:
redfin.com/city/14315/CA/Palm-Springs/housing-market