Bill To Permit Banning Hawaii Vacation Rentals Passes.

Hawaii Clears Path! Counties Can Now Ban Vacation Rentals

The Hawaii Legislature has approved game-changing vacation rental legislation. As a result, each island county in Hawaii ha gained significant control over short-term vacation rentals. That follows the successful passage of Senate Bill 2919. The bill, which encountered fervent debate, was approved in the state Senate by a nearly unanimous vote and now awaits Governor Josh Green’s signature, which he has already promised is forthcoming.

Previously highlighted by us as a pivotal development amid simultaneous and escalating housing and tourism crises, this legislation is a decisive shift in moving vacation rentals from state to local control. It allows counties to choose to phase out vacation rentals in Hawaii entirely for the first time.

The move purports to address the critical housing shortage and the displacement of residents and claims that the decades-long surge in Hawaii vacation rentals has exacerbated these issues.

The bill’s passage represents a significant victory for community groups like Lahaina Strong, who have advocated for converting vacation rentals into local housing. Governor Green has expressed his support for the bill, emphasizing that it will enable people to access housing again, a sentiment he reiterated during a recent meeting with members of Lahaina Strong in Honolulu.

Despite very strong backing overall, it was not without any dissenters. Three senators voted no, as did five representatives in the House. Their concerns included, as others have indicated, potential unintended consequences. Opposition to the bill underscores the complexities of balancing local housing needs with those of a waning Hawaii tourism sector, which has historically relied successfully on short-term rentals as one of its key features.

Those in favor of the bill have argued successfully that empowering counties to regulate these rentals will allow for more appropriate and nuanced local approaches to housing and tourism.

Others, however, include our readers who expressed opposition vehemently in well over 200 comments on the topic state adverse effects on tourism and upcoming legal challenges regarding the measure’s constitutionality will abound.

As we await Governor Green’s imminent signing of the bill into law, Hawaii is again poised to begin a new era. This legislation has the potential to transform both Hawaii’s tourism and housing. It promises relief for residents but will signal a period of unknown, legal contention, and ongoing adjustments.

As we continue to monitor this landmark change, we invite you to share your perspective and experience. How will these changes affect you? Please join the conversation as we follow the implications of this historic change in Hawaii.

Beat of Hawaii lead photo at Poipu Beach, Kauai, where many Hawaii vacation rentals are located.

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222 thoughts on “Hawaii Clears Path! Counties Can Now Ban Vacation Rentals”

  1. We live in pukalani, our rental condo is 500 sq’, 1 bed, 1 bath, small closet, beautiful views. No mortgage, cost/mo. Is $1,825, excluding all utilities, and another $300. 32 mi drive to kahului, prohibitive for a worker, and if passed, no local tourist jobs, maui will become a welfare state. I just dropped a $12,000 job for a local because of this. This is not made for long term or a family. Hundreds of other units present the same problem.

    Poorly thought out plan, for a good cause.

  2. I boughr my condo in 1993 while living and working on Maui. Upon leaving we decided to rent long term to a local resident. For 15 years we subsidized our mortgage payment by this rent. After the tenant moved out we still had 10 years on the mortgage but wanted zo begin to make Maui our second home but had to renovate to get the income through short term rentals so we could come out a few months a year. If this legislation passes after 25 years we will have to abandon our dream to retire in Maui or sell our beloved second home. I am only one of many stories of how short term rentals evolved but elimination will be destroying lives of those who have heavily contributed to Maui’s tax base and economy.

  3. With depressed tourism numbers taking hold and the uncertainty around STRs, the Maui economy will enter a historical recession in 5…4…3… while places like Kauai may continue to hold their own in the months and maybe years ahead since they seem unlikey to support an STR ban. When will Green and these legislatures pay the political price for this destruction (including the incompetence that helped cause the Maui wildfires – no land mngt etc)? The answer is never since the voters will continue to put these incompetent fools in office.

  4. Given that Hawaii has two main economic assets, tourism and its also a natural stopping point for shipping between Asia and the us mainland. The jones act has plugged up the vitality of Hawaii as a transit port since 1920. Now the State seems to want to put tight controls on tourism. This will make Hawaii, the Lebanon of the Pacific, a place with nearly no export economy.
    If Hawaii wants an economy that is vital, its best chances are to modify tax rules to make Hawaii a world center for R@D. This would require drastically reducing the top income taxes and not requiring amortization of R@D expense on state income tax, a fix California has made.

    1. Yeah a little pixy dust and a magic wand and poof all the housekeepers etc become research and development people.

      1. Rich people leave their 2nd homes and condo’s vacant. If well paid working people could afford to live in Hawaii full time, they would use many services that employee locals. Hawaii is one of the 3 states with the highest income taxes(CA, NY, HI). Dropping income tax rates would be one of the few things that could improve the economy. The work from home types are the best substitute for tourist who would come if the tax rate were lower.
        Its likely Hawaii kills tourism, the politicians will raise taxes to and drive out more of the rich who pay the most tax. As welfare state ends the workers will leave even faster than they do now.

  5. It’s almost as if the economy here was spiraling down the drain before short term rentals and airbnb saved the day. All the agonizing over the loss of a service that is less than a decade old really has people clutching at their pearls. Hilarious.

  6. The consensus on this issue seems to be that the STR ban will be tied up in court for years. This does seem reasonable. The question I pose asks how many travelers will risk making advance reservations with so much uncertainty involved. I know I would not but others- who knows.

    1. We should remember to differentiate the short term rentals in the different areas. Not all short term rentals will be gone. The ones that are in hot hotel zones will remain. I think there is a lot of confusion around this… There are a few that I know of for sure in Kihei that are in hotel zones. This information can be found on the Maui county website.

      1. It matters little that there would be a few STRs left standing when 60% of STRs are targeted to be removed, along with all of the businesses dependent on those STRs. The fallout from this would be massive.

        Additionally, the nightly prices of the remaining STRs would rise dramatically, since the supply would be gutted while the demand would remain the same. That’s just Economics 101.

        Visitors are already struggling to afford recent increases on STRs and hotels alike on Maui. A 60% reduction in supply and resulting price increases would be a death knell for most visitors.

        1. Well said, as most of these comments are. One of my would be renters said it best, hawaii is killing the goose that lays the golden egg. Too bad the makers of this didn’t actually listen to us before, and actually make housing more affordable. We have been priced out by taxes upon taxes, upon taxes, for their pet projects, not the peoples.

  7. Before everyone get’s in a tizzy I found the Hawaii Government’s definition of a STR:

    “Short-term rentals (STRs) are also known as vacation rentals, and are lodgings that provide guest accommodation for less than 30 consecutive days. In order to preserve housing for long-term residents, STRs are only permitted in resort-zoned areas and a couple of specific apartment-zoned areas.”,of%20specific%20apartment%2Dzoned%20areas.

    So those of you staying for 4 weeks, you’re good. Those of you staying in the “resort-zoned area and a couple of specific apartment-zoned areas” you’re good.

    1. The length of stay has nothing to do with it. It’s going to be the property. Basically, if you have something that’s not permitted, they’re going to shut it down. If you were in an area that the government says you cannot have a short term, vacation rental, even if you put somebody in it for 30 days or longer, it’s still classified as a short term vacation rental. If I put somebody in for three days and then I have somebody come in and stay for five weeks and then I have someone come in and stay for six days. It’ll all be looked at the same.

      1. In the case you are describing, the problem is the Landlord. If the landlord writes a contract for less than 30days, that’s a landlord problem.

        No one says they have to Stay in the unit for the full 30days, but the landlord can’t have 2 contracts for a given unit at the same time. So if someone only wants to stay for 3 days, that’s their choice, but the landlord would have to write up the contract for at least 30days and would not be able to rent the place again until the contract it up.

        I hope that landlord charges a lot to that 3 day customer, because they’ll be out a lot of money.

    2. Only the rich can stay 30+ days so forget making Hawaii affordable to middle class families, who are what the employees of Hawaii are most like. STR are the only affordable options for a once in a lifetime family of 4 vacation experience.

  8. So does this mean we cannot book vacations to hawaii?? Such as resorts, airbnb ,hotels home? We are wyndham by worldmark owners will that affect us??

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