Rising Costs Continue To Drive Down Hawaii Visitors

Rising Costs Continue To Drive Down Hawaii Visitors

The Japanese are very slowly coming back but spending much less. Decreased domestic arrivals and spending on Maui continue to drag the state down. And where are the new visitors to Hawaii? One thing for certain, the higher cost of accommodations, up to 70% more, is continuing to send people elsewhere. And you’ve said as much in thousands of comments.

Last month, the Hawaii tourism industry faced a mix of challenges, with domestic visitor numbers more closely reflecting economic changes. Insights from the state’s Department of Business, Economic Development, and Tourism (DBEDT) February 2024 report paints a clear picture of Hawaii’s tourism lagging recovery.

Hawaii residents and BOH regular Justin expressed his concerns well. “The long and the short of it is simple: People have found other places to go where their money travels further and they perceive being treated more warmly. I cannot get friends to come visit us on island and the two reasons I almost always hear are those two above. I will then see them post of social media being in Mexico or the Dominican or other places around the Caribbean. We’re slowly killing the golden goose with no alternate plans for income here.”

Maui was the only island that did not see an increase in visitor numbers or spending. And while all the other islands did, the increase was small, suggesting that typical return guests to Maui are mostly not returning to Hawaii yet.

Domestic visitor trend has been down since August.

Despite a moderate stream of visitors arriving in the Hawaiian Islands, digging further beneath the surface, concerning shifts in average daily census and spending patterns reveal the changing nature of Hawaii’s tourism market.

The U.S. West and U.S. East regions are critical to Hawaii’s tourism industry.

In the midst of fast-changing travel preferences, efforts to attract visitors from these markets should continue amidst shifting circumstances if Hawaii is to be successful in retaining visitors. Your comments make clear that Hawaii will need to work harder to keep you island vacation focused instead of looking farther afield.

At the same time, small signs of optimism emerged from the state regarding the Japanese market, making Japan-vacationing visiting Governor Green happy, who was in Japan this month seeking to deepen ties with Japan and capitalize on opportunities for mutual economic growth. That said, Japanese visitor spending remains down, reflecting cautious spending behavior.

Governor Green’s DBEDT Director, James Kunane Tokioka, acknowledged the challenges facing Hawaii’s tourism industry. However, in the obvious uncertainty, he believes a spirit of collaboration persists in Hawaii travel, driving efforts towards sustainable growth and resilience.

Visitor behavior is worth noting.

First, “Most U.S. West visitors in February 2024 had been to Hawaii before (84.0%) while 16.0 percent were first-time visitors. We continue to believe that retaining customers (Hawaii visitors) is far easier than attracting new ones.”

That concept appears to be missing in the thinking of the HTA and Hawaii’s governor, neither of which have, to our knowledge, ever addressed the value of return visitors.

Where did Hawaii visitors stay in February?

“In terms of accommodations, 51.5 percent of U.S. West visitors (the most prolific of all Hawaii visitors) in February 2024 stayed in hotels, 16.4 percent stayed in condominiums, 13.5 percent stayed with friends and relatives, 12.5 percent stayed in rental homes, and 8.5 percent stayed in timeshares.”

With Hawaii hotel and vacation rental accommodations privately owned and outside the state’s purview, what would you like to see Hawaii do to win back your visitor business?


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46 thoughts on “Rising Costs Continue To Drive Down Hawaii Visitors”

  1. US West Coaster Here –

    Hawaii has to stop looking at us as just $$$ and nickel and diming for everything. OK….hawaii can be beautiful, but lots of the world is more beautiful. Those places are lower cost and actually welcoming. Europe, Carribean, Asia is far cheaper and provides better value.

    Hawaii has destroyed their image on playing identity politics and blaming everyone else for the problems. Proper management and fiscal responsibility would have solved a lot of these problems.

    For example, Bonaire – 1 week of luxury accommodations …week of diving and 4×4 …. 730USD all in. No expectation of ridiculous tipping or surprise fees everywhere. Not to mention they are encouraging and helpful to people visiting……

  2. Social media is damaging the Aloha image. Some locals respond with hostility to visitor inquires. The fire seems to have triggered anti-visitor sentiment. It is difficult to get potential guests to visit a location that is perceived to be xenophobic when there are many other locations that are welcoming and less expensive.

  3. Lived in Maui 3 times, and have been coming for over 25 years. I came with family last Thanksgiving…things have changed. This local anger against visitors has been slowly going downhill over the years and the fire has brought it out to another level. My friends that still live there agree with me. Fear of education, training, life skills, and “what I call fake” Aloha is the norm. So, I will continue to visit the Big Island, where several friends have moved and Maui is off the travel list.

    1. I couldn’t agree more, I’ve been visiting for over 10 years and things have gone down every time but the place is beautiful and accept it for what it is and make the best of it. Save $$ where you can, mainly by Not staying in hotels.

  4. Governor Green, are you listening?

    The tourism industry in Hawaii cannot survive by pricing out the average traveler and his/her traveling companion(s).

    Do not hold your breath waiting for the Japanese to come back. Their economy is in a depression while we suffer an inflation. Food and lodging costs in Japan are just about 65% less than here in Hawaii! Only a very wealthy Japanese person can consider a return to the islands.

    Just like Turo is a cost-efficient alternative to the mainland car rental companies, non-hotel accommodations remain the most cost-effective accommodation choice. Forget Muffi and the hotel industry and support local ownership and hospitality.

  5. I’ve been to Hawaii at least 8 times in previous years. I am very interested in Polynesian culture, language and dance for many years. I was planning a return however after viewing hotel rates, car rental rates and incidental fees I will instead look at cruises and all inclusives in Mexico, Caribbean and the Mediterranean. Though it saddens me to make other choices, I will go where I am more welcome.

  6. We just returned from our 23rd or 24th trip to the islands. A couple things were obvious. Condo and hotels were still very high. Our airfare was down a little. Gas was still $1 to $1.40 a gallon higher than the Midwest but no higher than our trip 5 months earlier. Car Rentals still remain extremely high probably due to rental fleets being reduced dramatically during COVID. We have always been treated well by locals on all our trips because we want that local experience and treat them with the utmost respect. When our son finishes his home we will probably be coming even more and still renting cars and condos because there is nowhere on earth like Hawaii….and we have been all over the Carribean.

  7. I read all the comments, 33 so far, and have some thoughts on all this.
    1. I have been coming back to Hawaii every year since 1993. (except 2020). I have not met any rude locals. I have always been treated as a friend.
    2. Any elected official has only 1 goal: to get re-elected. If during the course of that job they do something for the good of all, well, it is probably an accident.
    3. None of this will change until the locals elect a new state government. Your current one party rule is causing 95% of your problems. That party has never met a tax it didn’t like. Look at DC, that person is spending trillions for the sole purpose of getting re-elected. Point made.
    See you in Dec.

  8. The islands, especially Maui, are pricing themselves out of business. There are many wonderful beach locations here in the mainland as well as Mexico and the Caribbean, all of which are less expensive and very welcoming. Be careful what you wish for, because it just might bite you in the rear end. The wealthy also go to Europe instead of Hawaii, so don’t depend on them to keep you afloat. We have a trip planned for June – early July but it may be our last. We are trying to get airfare for my son and wife and we can’t find anything for less than $800+ round trip from Los Angeles or Orange County. Accommodations are the most expensive, but airfare has gotten very high as well. Good luck with your new plan to entice the Japanese.

  9. Aloha,
    We enjoy our annual visit to Kauai, and look forward to returning in January 25. Unfortunately this annual trip is becoming very difficult to sustain, and we are actively considering other options including canceling the trip in 2025.
    Cost is a factor, yes, but not the only factor. Overcrowding, poor road infrastructure, traffic in paradise do all degrade the appeal of Hawaii.
    Another factor that seems to get lost is the importance of comfortable reliable affordable air transportation. I am keenly disappointed that HAL has configured the beautiful new 787 with a 3x3x3 seat configuration and no true premium economy seating in pairs. Sorry but 3×3 seating is a deal breaker. Not doing it! Its supposed to be a vacation!!!

  10. I have worked in hospitality on Oahu for over 35 years. According to the US Census Bureau, there are 239,307 in the tourism sector (2021). I would imagine this number is 2x-3x with people indirectly involved with tourism (restaurants, wholesalers, distributors, etc). I don’t imagine everyone tied to tourism wishes to have less tourists. It’s the vocal minority and certain politicos that have a soapbox that get all the attention.
    I welcome all visitors with Aloha, hope they have a great time, infuse the economy with their dollars, and plan to return with their friends.

  11. What is not being reported in the MSM is that over 20 of the 50 US states have already rolled into recession, including the West Coast States, WA, OR and the biggie, CA.

    The years of free money bomb and subsequent debt spending and hence inflation is catching up with the States, which have to balance their budgets. Unemployment is rising quite dramatically, especially in CA, even though the MSM does not report it. The government keeps posting “good” numbers for headline news, then quietly revising their numbers for employment downward steeply month after month.

    The Feds are trying to keep it all afloat with massive deficit spending, but this will just lead to more and longer inflation, more debt, more problems….

    1. Couldn’t agree more. Only thing I would add is the Fed Gov planned spending 100’s of billions in the next few years will mask an economic downturn which will keep inflation elevated and only exacerbate the wealth gap.

  12. Many prior comments seem to blame the state – somewhat unfairly. While the state has not exactly managed the conversation regarding overtourism particularly well, the main culprits of runaway costs are (primarily mainland) hotels and car rental companies who are price gouging to a truly staggering degree.

    Hawaii visitor taxes are based on the cost of accommodations. If the accommodation costs come down, so do the taxes.

    1. Drew, you are forgetting the “tax rate”. Short-term rentals, hotels, and timeshares pay almost 5x as much in property taxes as residents. We residents should pay less, but not That much less.

      The cost to the visitor is not only affected by the price of the accommodations, but on the tax rate imposed on the accommodations. For instance, on Maui, 11.85% is overly inflated compared to the 1.9%(!) the residents currently pay in property taxes.

      This is on top of the Transient Accommodations Tax, General Excise Tax, and recently-enacted county-specific taxes that on Maui are 3%. This makes an overall accommodations tax rate of almost 18%.

      Lowering taxes would significantly affect the total accommodations cost for the visitor.

      1. I so agree with. you! The combination of extremely high real estate taxes on we owners cause us to raise our rates so we can try to at least break even on all of our expenses. Added to that, the almost 18% in taxes to the guest prices are getting out of hand. Personally, I think that many would not mind so much if we saw that these super high taxes went toward improvements for both residents and visitors. We have been visiting Kauai frequently for many years, as our daughter and her family live on island. It’s sad to note, year after year, that very little happens to improve the lives of residents, or the experience for visitors. We cant help but wonder where all the tax dollars are going.

      2. When my bride an I visit HI I budget $10k/week. Which includes FC air, car, condo and dining out. Ridiculous, but at some point the madness has to stop. HI is quickly becoming the playground of the very wealthy and elite. Sad!

  13. Travel to hawaii has really got expensive, a week at hotel can easily cost $2000 , with air and meals another $2000. I find the roundtrip 16 day cruises from San Fran and Los Angeles to 4 hawaii islands and ensanada Mexico for $2000 total to be quite nice , and free 16 days of meals on ship and free entertainment.

  14. We were there for two weeks, leaving the first week in March. The prices to eat at the airports, on flight there, kind of prepared us for the price of food. Our, one bedroom condo we rented through Airbnb was over three thousand dollars. We are a retired couple. We never would’ve been to afford it with kids. Even renting my car, was really high. We’re coming back as soon as this fall, prices permitting.
    We were on Kauai. The medical care from the ER. In Kapaa and the attitude of physician, made us realize it wasn’t really safe for elderly.
    He said, ” you are on a rock in the middle of the ocean”. No more Kauai for us..


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