Maui’s sweeping plan to ban thousands of legal vacation rentals is unraveling—but not before leaving travelers and owners in turmoil. With new economic data raising red flags, county officials are quietly backpedaling. For many, though, the damage is already done.
The plan that shook Maui travel.
The county’s proposed legislation aimed to phase out short-term rentals in apartment-zoned areas starting this year. That would have originally eliminated more than 6,000 permitted units in South and West Maui—places like Kihei, Kaanapali, Napili, and Wailuku—where condos have long been a core part of independent Hawaii travel.
Well-known properties like Maui Banyan, Papakea Resort, Honua Kai, and Hale Kamaole were suddenly thrust into uncertainty, leaving travelers confused and owners deeply concerned. These are not illegal operations. Most are professionally managed, pay taxes, and have operated for decades with full awareness from the state and county.
The plan was introduced to ease Maui’s housing shortage, especially after the Lahaina fire destroyed over 3,000 homes. However, a promised county-commissioned study to evaluate the impacts—budgeted at $300,000—was never completed. In its place, outside researchers stepped in with a report that may just have changed everything.
Economic warning sparks a quiet shift.
A new study from the state’s economic research team at the University of Hawaii, UHERO, paints a stark picture: a $250 million annual hit to Maui’s economy, nearly 5,000 jobs lost, and a 4% drop in GDP. These numbers are impossible to ignore for an island still reeling from disaster recovery.
The study also predicts that eliminating these rentals would remove up to 25% of Maui’s visitor accommodations, reducing overall spending by 15%. Property tax revenue could fall by $60 million annually, dealing a blow to public services.
Faced with the report’s findings, county officials have begun shifting their tone. Instead of pressing forward, they’re now exploring other strategies: increasing taxes on short-term rentals, taxing vacant homes, and auctioning a limited number of vacation rental licenses.
But the reversal isn’t official—there’s no repeal, no formal pause, just a clear and sudden pivot in language. And that uncertainty has been more than enough for travelers already affected to reshape plans.
Dr. Steven Bond-Smith, a co-author of the study, explained, “This policy risks significant economic harm without guaranteeing meaningful housing benefits for residents.”
Travelers are left in limbo.
Some owners have pulled listings or frozen bookings beyond 2025, adding to the uncertainty. For longtime visitors, the situation feels unstable, even if nothing has yet changed on paper.
This mirrors concerns from the recent past, including vacation rental cuts threatening Maui’s future and the broader rental restrictions across Hawaii. But this time, it hits deeper—because it involves long-standing, permitted accommodations that many travelers have used for decades.
Imagine booking your favorite Maui condo, only to discover it’s no longer available, forcing you into a crowded hotel or pricier resort rental. For many travelers, this uncertainty has already changed how they plan their trips.
Reader Deborah commented, “We stay in a Kihei condo every winter. It’s quiet, affordable, and we support local businesses. If they take that away, it changes everything for us.”
Housing gains, but at what cost?
The proposal to eliminate the rentals was intended to free up housing inventory. According to that, converting the original 6,000 affected units to long-term use could increase supply by 13%, equivalent to a decade of new housing development on Maui. Condo prices could drop by 20 to 40%.
However, most of these units are owned by out-of-state residents, many from California, Washington, and Canada. Many owners are not positioned—or willing—to rent long-term, especially in buildings with rules not suited for permanent tenants. Some units could have sat empty or quietly re-entered the short-term market illegally, raising enforcement challenges.
We’ve seen similar tensions in past coverage, such as why Hawaii vacation rentals plummeted. The state’s visitor economy depends on supply that aligns with what travelers want, and what’s being removed may not be easily replaced.
Economists noted the plan’s scale is globally unusual. Los Angeles regulated less than 1% of housing through vacation rental limits; Barcelona, 2.6%. Maui’s proposal, however, was set to touch 21% of its housing inventory.
Travelers need to stay alert.
If you’re planning a trip to Maui, it is a good time to verify the status of your vacation rental with the property manager. While no ban has passed, and a complete reversal of the proposal looks entirely possible, uncertainty remains. Apartment-zoned properties are the most at risk if the original legislation were to advance.
Resort-zoned rentals and hotels are not affected, but hotels may be pricier or lack features like kitchens and laundry that Maui travelers value highly.
For those who book far in advance, especially into 2026, double-check policies and monitor Maui County Council updates. As we’ve seen, proposals can shift quickly, without clear communication to visitors.
Trust in Maui may take years to rebuild.
Even if the plan is ultimately shelved, the message has already been sent: Maui’s visitor accommodations can be destabilized nearly overnight. For travelers, that adds unwanted risk. For the island’s economy, it means potential long-term erosion in visitor confidence.
Reader Tom shared, “If I can’t trust that what I book in Maui will still be there, why would I take the risk?”
That sentiment is now echoed in our Tahiti vs. Hawaii comparison, where readers increasingly point to rising costs, regulatory uncertainty, and a sense of being unwelcome as reasons they’re looking elsewhere, beyond Maui.
Maui’s vacation rental saga is becoming a cautionary tale for Hawaii and global destinations trying to balance housing needs with tourism. Even if the reversal continues, the trust of travelers and owners may take years to restore, and the ripple effects could reshape Hawaii travel far beyond Maui.
Let us know if this changing policy has affected your upcoming trip or how you view vacationing on Maui in the future.
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Maui is now part of a Globalist strategy to transform it into a Smart Island, with the Smart City being Lahaina. Expect more draconian changes to come.
Yet another example of incompetent governments making stupid decisions and destroying the Hawaiian economy. Unfortunately the residents are to blame for voting in these baffoons.
There are many many more wonderful places to visit then maui the locals who live here are truly blessed people the tourist are basically screwed because even the cheapest abnb are Too expensive there is an undying culture war Between the preservation of hawaiians and hawaiiana. Vs. Tourist just looking for the angle Of money and consumerism Road overuse by larger Suv rentals the landfills Growing like a giant tumor infectious inbound germs hurting the hotels industry who Pay more taxes per head. Then abnb and Creating marvelous empires of majestic resorts culture!!! Abnb in small apartments are an overpriced sham Fueled purely for profit and greed!!
I built a second home on Maui 24 years ago….it’s been a nice trip but it’s come to an end. The locals are not friendly, the politicians have gone stupid and it’s just not safe anymore. My property taxes as a non-resident are increasing dramatically and the locals property taxes are dropping. I recently decided to sell my property like many others. Most of the residents live in poverty but all drive new trucks with big tires. I realize that I am not wanted, needed or safe there anymore…..I am leaving.
We have felt a real sense of being unwelcome and it has increased over the years. I do not want to travel to a location where my families presence is treated as it’s ruining peoples culture and destroying their lives. I want to relax on vacation and not be treated like a nuisance. There are plenty of tropical destinations that are far less expensive and political than Hawaii.
Due to the uncertainty in Maui we’ve shifted our travel to other islands. We will not stay in a hotel environment so our choice of destination has a lot to do with that. Also eliminating short term rentals won’t automatically make those available to locals. If they sell, they may sell to non-locals who can afford ownership, particularly if the prices drop. But they might not be affordable to locals even at a reduced price. I feel for the locals who need housing but I’m not sure this is the solution if it hurts the economy and eliminates jobs.
I have been to Maui about seven times in the last eight years. There really is no great cultural experiences there. Pretty boring except for the beauty of the ocean. And on top of how Hawaii has been treating the vacation rentals since the fires, I have seen an increase in racist behavior towards white tourists.
I realize this is not the Associated Press, but could you do a little bit of fact-checking?
Maui Banyan is officially hotel zoned and therefore was never on any list for being canceled for vacation rentals.
Misinformation hurts travelers and property owners alike.
Honua Kai was never on the list and never at risk. They are hotel zoned.
We haven’t coming for years and we’re planning on coming this summer. But after all of this started to hit, we canceled our month-long vacation rental. It will take us years to trust the Maui government again.
Maui has so many people that love it. You won’t make it better by banning STRs for all the reasons commented on below. You won’t make it better by building more resorts. It is going to take vision, courage and time to make the changes that are needed. Leaders must tilt away from the resort/vacation economy to provide a long term solution for residents and visitors alike that improve Maui. This means affordable housing. Even doctors can’t afford to live on Maui. It means building an exceptional education system so employers have workers who want to earn more than what a housekeeper makes at a resort or STR. It means providing incentives to employers who create jobs in other areas of the economy rather than the travel resort industry. This takes leadership and it takes time. Now is the perfect time to find leaders and empower them to make new, different decisions that will make better for Maui for the next generation.
You are 100% correct.
Mayor Bissen talks about culture and the difficulties of keeping culture when people leave.
He is right, but people aren’t leaving because of housing shortages. People are leaving because there are not good jobs available. Maui needs to diversify its economy to keep its people. Killing the one industry doesn’t keep its people home.
Your education results are some of the worst anywhere. Sadly many locals want handouts and do not care if their children go to school. Literacy and math skills are so low that they are almost impossible to change unless you vote for change. Current will never change.
this is one of the biggest self inflicted wounds one can find…sacrificing the near certainty of loyal tourists for levels of uncertainty with an ill advised STR ban…the damage has been done…sadly Maui & overall Hawaii travel uncertainty is here to stay…and the residents keep voting for these people…