Maui’s vacation rental battle has taken another turn, with greater uncertainty now looming over the county’s ability to implement its plan to phase out 7,000 short-term rentals. A $300,000 study meant to evaluate the ban’s economic impact has failed to come to fruition, with no interest from potential bidders.
Initially, only one company appeared to consider taking on the analysis, but even they ultimately did not move forward. The study was due in December last year, and questions including ours started mounting when results failed to materialize. Without this analysis, the county’s justification for the policy remains shaky, leaving property owners and the tourism industry in limbo. Lacking this key analysis, the debate remains driven by political rhetoric rather than having that solid economic forecasting foundation.
Residents and visitors alike are questioning whether the plan will ever move forward. As Jim D. put it, “If this ban moves forward, we might have to stop coming altogether. I understand the housing crisis, but taking away legally operating rentals isn’t going to magically make these still expensive homes affordable for residents.”
The fear of unintended consequences is real, and the county has yet to provide concrete answers.
The $300,000 study no one wants to do.
Without any interest, the county may be left without anything on which to hang the proposed ban and its financial impact. Lacking this key analysis, the debate remains driven by politicians. Some have suggested the lack of interest may stem from the study’s complexity, timeline, or concerns over political pressures.
As Tom R. put it, “Rental owners are still waiting for the county to make public the economic study that was issued 10/1/24. We believe that it would show what an extreme loss of tax income to the state and county.”
The delay in obtaining this study is not just an inconvenience—it casts doubt on the entire plan’s viability. It raises questions about how serious county officials ever in terms of analysis regarding the ban’s impact.
Lawsuits, legal battles, and endless uncertainty.
The vacation rental industry has also made it clear that it won’t go down without a fight. Owners have been preparing for extensive legal battles, with some predicting the process would take years to resolve.
Mark M. summed it up: “The lawsuits are coming, and it’s going to be a long, expensive battle. In the end, I wouldn’t be surprised if nothing really changes except that Maui ends up with even more division and bad press.”
With some legal experts suggesting that existing rental owners have a strong case, the county faces an uphill battle if it proceeds with enforcement. If the matter moves forward only to get tied up in court, it could render the ban ineffective for years, leaving both renters and property owners stuck in a state of uncertainty.
The economic fallout is vast.
One of the most contentious aspects of the proposed ban is its potential harm to Maui’s economy. Many visitors prefer vacation rentals over hotels, and a ban could lead to declining tourism spending. Joe highlighted this concern: “If Maui doesn’t want my vacation dollars, plenty of other places do. I used to go every year, but between the ambivalence toward visitors and the insane prices, then this nonsense, I’m looking elsewhere.”
The county has yet to clarify how it plans to replace the enormous tax revenue generated by short-term rentals. Without these funds, some fear property taxes could rise across the board, shifting the burden onto full-time Maui residents.
As J noted, “If these STRs become long-term rentals or more likely vacation homes that one family and their friends use, this drops my property taxes from $23,000 to around $3,000 a year. So the county loses another 100 to 150 million in elevated STR property taxes.”
BOH reader John just commented: “I cannot sell our Maui VRs soon enough, we bought our first unit 15 years ago. With the ever increasing taxes, costs of cleaning, HOA dues, maintenance…. they are a terrible investment. Rents are not keeping up and the added taxes have forced visitors to look elsewhere. Until a decision is made one way or another, it is silly to list your properties for sale. Look at what has happened to condo prices versus home prices in Maui, a direct result of unfriendly policies. Money will always go where it is treated the best.”
Could these rentals ever become long-term housing?
One of the primary arguments for banning short-term rentals is the obvious need for more long-term housing for residents. However, many argue that the types of units affected by the ban are neither suitable nor affordable for families. Bill B. pointed out, “One- to two-bedroom condos dominate Maui’s STR market. They are ill-suited for families displaced by wildfires or residents needing multi-generational housing. Solutions must adapt to this reality rather than treating all units as interchangeable.”
With median home prices in Maui still far out of reach for most residents, critics argue that the ban would do little to improve housing affordability. Some properties may sit vacant or be purchased as second homes rather than converted into rentals for local families.
What comes next?
For now, the future of Maui’s vacation rental ban remains uncertain and on shaky ground. The county’s inability to commission its economic study, the likelihood of lawsuits, and ongoing opposition from Maui residents all raise serious doubts about whether the plan will now ever be implemented.
As Patrick G. noted, “We have friends in Kihei who are affected by the list. They use the property quite a bit, but can’t afford the property tax and HOA fees without renting it out part of the time. There is no way a family could live here.”
Without a clear road map, Maui’s leaders may be forced to reconsider their approach. For now, visitors, residents, and property owners are left waiting for answers while the clock is ticking.
Please share your thoughts on where you see this heading.
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As a person who has lived in an area that allows vacation rentals I will tell you that these places are nightmares for the residents that live around them. Late night parties, trash, drunken people yelling in the middle of the night etc. And yes, we had to call both local security and the police on multiple occasions. But that doesn’t stop the NEXT crew of revelers from doing the same thing.
Instead of an outright ban, maybe rules need to be made to limit the number of STRs in a neighborhood. There are many communities on the mainland that already do that in order to prevent their neighborhoods from being taken over by investors who don’t care about the neighborhoods they buy in.
In our case we had to move from a place we loved into a neighborhood that didn’t allow STRs in order to get some semblance of peace and quiet.
So all of you vacationers who are whining about not wanting to pay the resorts, please Do go somewhere else. You don’t respect the island ways anyway.
We have been coming to Maui for 35 years and we would stay for 4 weeks but the cost have gotten beyond our means. We now go to Europe .
Are we sure Bissen passed the bar ?
In the private sector you would be fired for making a proposal of this magnitude without first doing the analysis so you could then make an informed and fully vetted decision . In Maui I guess they do things differently . Bissen should step down for this incompetency and for being in the pocket of LS who frankly are narrow minded and have no plan b to pay for all their initiatives if STR get banned
The damage is already done tourism is down, people don’t feel welcome and you are hurting STR owners of which approx 1000 of the 7000 are residents here like myself .
Lastly , Rawlins and patlin are a disgrace .. they keep complaining about lack of housing but Rawlins opposes everything trying to impose 50% affordable housing on projects that legally only require 25%
Rawlins is a small fish in an even smaller pond
Wake up Maui vote these folks out and stop listening to LS they Have their own agenda and don’t care about the fine people of Maui
Your can read the RFP and the Requests for clarifications here: mauicounty.us/request-for-proposals-rfp/rfp-25-003ocs-economic-analysis-and-impact-study-of-phasing-out-transient-vacation-rental-use-in-apartment-zoned-districts/ The Requests are eye opening – lots of data that the bidder needs were not going to be available from the County . An impossible task.
Hello
I have been reading a lot of the responses on this article and am very concerned. I lived on Maui back in the late 80s to early 90s and back then I could see that housing was getting to be a problem. We visit Maui at least 3 times a year since moving away and for awhile we stayed at resorts but now we have been staying in STR. The last few visits we have seen the STR and hotels raise there prices which I felt was normal due to cost of living and taxes. Yet when talking to the locals we have come to know the pay hasn’t really increased with the cost there. I am saddened as well that I found out that mainlanders actually rent apartments out there and then turn them into an STR. I was shocked after finding this out. Whether it was legal or not this shouldn’t happen. Each time I go back it pains me to see how much the local people have to endure to stay on their native land. This shouldn’t be happening.
I don’t think I have enough popcorn to last through this…
Fiddle Faddle
The bill was a knee jerk reaction to the small group of protestors on the beach rather than a well thought out and nuanced piece of legislation that could actually help the situation. It is a situation that needs to be addressed, but this is sorely lacking foresight regarding economic impact and unintended consequences.
Agree. Mayor Bisson said what he needed to get the protestors off the beach knowing full well this plan would never work. He’ll save face by saying “I tried, but the lawsuit won’t allow the ban to move forward”.
Hey Jonny,
You are absolutely correct! The mayor is totally incompetent, just like the governor. Until the citizens of Hawaii vote these people out there will be continued chaos and economic hardship for everyone.
I have a 2 bedroom timeshare on Maui. I pay over $1,500 for 1 week in operating and maintenance fees. This would translate to around $6,000 per month in HOA fees. What middle class resident could pay that in addition to a mortgage and property taxes? Insanity!
Be still my beating heart…
Could it be that the good citizens of Maui are finally coming to their senses?….
Nah, never happen.
Maui politicians just blah, blah, blah, and absolutely nothing gets accomplished. This is a total disaster and demonstrates what I would call incompetence on steroids! Come on people vote these clowns out of office and bring some sanity back into Maui County government.
The solution to almost every housing crisis is build denser and build more housing. And in the case of Hawaii’s unique situation, restrictions on the usage of new housing. Trying to force old housing to fix the problem was never a solution.
All that said, I get the feeling that nobody wants Maui to turn into another Oahu but it’s probably going to end up that way.
Green is on the take from the Hotel/Motel Lobby. They are the only ones to win from banning STVR’s, period. Now STVR’s are lawyering up and this will go on and on. If you ban them it will devastate the state, period. You think that some Ohana is just going to move into a multi million dollar STVR?? That’s a joke. Owners of these places will work around legislation or just let their places sit vacant. Build more housing for locals using the outrageous taxes paid by these STVR’s. The land is there, the money is there. Break ground and quit talking about it.
If he was on the take, he’s sure doing a lousy job promoting tourism to benefit the hotels!
So true. What a crock as it’s only the hotel lobby behind this ridiculous scheme
Unfortunately, Hawaii is the most beautiful state with unique natural resources that people want to experience and return.
The posts I’ve read so far don’t reflect the reality of the STVR market. Separate the legal rentals from those operating illegally, those within the “resort zones” from those in neighborhoods, and target those ~39% of existing rentals owned by out-of-state residents (many owning more than 25 units each), and you might have a basis for reasonable legislation.
Those out-of-state owners that rent also don’t pay a dime in state income tax as income is realized in their home state, while local owners pay all taxes. Allowing legal STVR owners to build a separate Ohana with tax benefits for those renting to local families. Applying increased taxes to replace the lost tax revenue from those escaping Hawaii state income taxes. These are reasonable options for replacing lost tax revenue while supplying some local rental relief.
Wrong! Hawaii income is taxed in Hawaii! Out of state owners also pay property, GET and TAT taxes. That huge tax burden is part of the reason Hawaii is so expensive to visit.
“…don’t pay a dime in state income tax.”
– what are you smoking?
I manage & pay bills for over 100 non-Hawaii property owners (short term & long term rentals).
The average STR property owner in Waikiki (that i pay bills for) gets just 22% of every $.
Prop tax on an Ilikai 2 bedroom is $24,000/year.
An ilikai 1 bedroom is $12,000/year.
Owners pay GET, TAT, OTAT, maintenance fees, insurance, handyman, cleaners, and me – the prop mgr (all local) and state of Hawaii tax on their Hawaii income.
Illegal (non-registered) STR units cannot be advertised – so if there are any out there, i’d be surprised.
If you are against STR, fine. But maybe try & stick with actual facts?
I was told by a local realtor on Maui that a letter from the mayors office stated there are only 333 local families left needing housing after the fire. Why then do they feel like they need 7000 short term rental units to be converted to long-term for locals?
Political clarity on this topic is imperative; this uncertajnty is killing condo real estate market for Minatoya properties, and 2025-26 tourism. Maui Council needs to nix this idea formally and finally.
As of my last unofficial count, there are over 340 2 bedroom, 2 bath condos for sale on Maui. Almost all of them on the Monitoya list. Only one unit has sold in the past 6 weeks. This is the direct effect of the uncertainty created by the county council. Our STR unit has seen a property tax rate increaseof 150% over 6 years. From $6000 per year to over $15,000 per year. No median income resident can afford our monthly minimum cost of $7500. Add in that the unit is too small for a family of 4 (840 sq ft) and the complex allows only one parked vehicle per unit, how does a family afford such a unit? The county has forbidden development of affordable housing on so much land, it’s no wonder developers can’t build homes that would ease the housing crunch. We are in it for th long haul, that is how much we love Maui. If we have to convert our condo to a vacation home, then we will. How much tax revenue will that cost the county?
Yes. Massive tax revenue loss to the county if STR-legal units lose ability to rent. Difference between STR tax rates and resident rates is Huge. That’s not the only tax loss. When former-STR units sell for less… so will Other units. Real estate sales are comp based. If a former STR sells for 70% less, neighboring complex values fall too — along with *their* taxes.
But the real revenue hit is in lost secondary tax and income. Removing 7000 units of accommodation removes say 10,000 tourists per day from the economy. All the money they would have spent? Gone. All the income local residents would make from those tourists? Gone. That money for tours, rentals, meals, retail — all gone. All the sales tax, lodging tax, and income tax revenue on the money they would have spent? Gone. STR guests don’t hole up in a resort. They spend their money island-wide. Lose all that revenue and the tax on that? Massive trouble. Lost property tax is just tip of the iceberg of losses.
The best, most complete explanation of probable financial backlash I have seen yet! Thank you
Incompetence and corruption
This is a prime example of bad governance—to put a bylaw forward and then go looking for the facts afterwards. This whole sorry mess is the predictable result of a poorly thought out, knee jerk reaction to the Lahaina strong movement and now Green/Bissen have to somehow save face. They know this bill means economic disaster but it would be political suicide to admit it.
No one I know likes hotels over rentals for any kind of long stays. If I am traveling for a couple of nights hotels are ok, but not for any extended stay. Two of the places that I rented on Maui in the past are no longer rentals, they were sold. I have owned a vacation rental in California for 26 years so I know the problems. Maui could buy some hotels for long term housing or built some units. The way things are going over there, soon no one will show up, most of us feel most of you don’t want us anyway, so going somewhere else sounds better and better, so long Maui!!!
MauiNow printed some of the RFP and after I read it I could see why no-one wanted to bid on the job. In the meantime the hotel market on Maui appears to be doing well. The rental group I know best is running 92% occupancy. It’s hotel zoned. I’ve heard the STR market is having trouble, a couple of people we know aren’t getting much interest. There are a lot of STR owners that would like to sell, Maui Council should just try to work directly with them and if the are selling a unit that is suitable for long term rental, do some sort of a deal.
When are Hawaii voters going to stop electing corrupt pandering politicians who worsen Hawaii’s problems with feèl good, do bad, proposals like the STR ban? If you want low cost housing then legislate more of it. A vibrant economy and preservation of values are not inconsistent when you have politicians that are willing to make the correct, if hard, choices. In the meantime, Hawaiians need to get clear about what they want, and vote accordingly.
Chris Hanford was the last common sense Maui politician
Bissen, a former judge, should have known better, but he’s now a pandering, ill-qualified Mayor. Doesn’t speak well to the judiciary here.
Never!
Same old blue blue fools and same old stupid results
Come, don’t come,welcome not welcome,ban or lift ban. Glad Hawaii Tourism Authority is gathering all this visitor data responses. All I lately see is negative situations and confusion. Just ask tourist’s how bad does a tourist really want to come and visit other than messing with our patience and lives. This not only affects visitors. It affects all locals and Hawaiians that reside there too. IMO Sad and real disrespectful.
It is important to note that two economic impact studies have already been conducted. One by Paul H. Brewbaker, Ph.D., CBE, titled *”Economic Impacts of Removing Units in Apartment-Zoned Areas of Maui County from Short-Term Rental Use,”* and another by Kloninger & Sims Consulting LLC, *”State of Hawai‘i and Maui Economic and Fiscal Impacts of the Short-Term Rental Industry.”*
Both studies clearly demonstrate the severe negative impact such legislation would have on Maui’s economy.
Given that the county received only one bid—ultimately rejected by the bidder due to county’s contract terms—and has now opted to conduct the research in-house, it raises the question: Were they unable to find someone willing to produce a study that would “bend the numbers” to align with the proposed legislation?
Let’s add one more basic proof to the ridiculousness of this proposal, the fire victims under FEMA’s program for rent payment, starting 3/1/25 will have to pay rent based on HUD fair market rent rates. The fire victims are appealing these rates as they are to much for them to cover. The HUD fair market rent rates either don’t or barely even cover the STR’s HOA and insurance payments. How will the victims cover any other of their basic living expenses.
Perceptive and evenhanded synopsis of the preposterous suggestion of an STR “conversion” on Maui, BOH.
For once, I have nothing to add. Mahalo!
Hi PatG.
You made us laugh. Thanks.
Aloha.
Aloha Rob and Jeff. What? There was a study made late last year that wasn’t put out? It seems the public information act would require it to be made available. Sounds like the results weren’t what the government wanted to “prove” their case. People should pursue opening that immediately.