The latest report just in from the state reflects an incredible stubbornness of Hawaii hoteliers to moderate rates in spite of significantly sub-par occupancy performance. And here’s why we think that’s the case.
For now, anyway, we are willing to pay the price because of the demand. And hotels like that we do so they can stay at less occupancy, with less staff, and still come out ahead. The days of seeking full occupancy could be behind us.
The Hawaii Tourism Authority (HTA) said that statewide occupancy in September sat at 75.5%, with an average daily rate up 40.5% on 3.5% less occupancy compared with pre-Covid. We continue to use 2019 as the reference point for price comparison. The reason being that 2022 was an anomaly with tremendous growth in travel following the multi-year Covid shutdown and the ensuing Hawaii travel bonanza.
Last month’s survey included nearly 46K hotel rooms, representing 83% of the state’s hotels in properties with 20+ rooms. Vacation rentals aren’t included and are reported separately.
Hawaii hotel findings for September 2023 include:
- Statewide, “luxury” hotels had an average daily rate of $677, up 48% compared with 2019.
- Those in the mid-range had an average daily rate of $235, also up 48% compared with 2019.
- The report compared Hawaii with other top-performing US markets over the first nine months of the year. Not surprisingly, Hawaii hotels led the entire country with its average daily room rates of $379, higher even than New York, which was just $279, and San Francisco, which was $226. Yet Hawaii ranked behind New York, Las Vegas, and San Diego in occupancy.
- Compared to similar international destinations, Hawaii’s well-loved neighbor, French Polynesia, had the highest year-to-date average room rate at $840, followed, not surprisingly, by Maui’s $609. With taxes included (no fees), that brought Tahiti to $924, while Maui’s much higher occupancy tax brought the total to approx. $719.
Maui hotel rates last month jumped 69% compared with 2019.
Maui hotels, severely impacted by the August fires still retained the highest average daily rate of $534, up 69%
compared with 2019. In spite of a spate of declining visitor counts on Maui, we are still hoping and waiting for some significant reduction in hotel room costs.
Kauai hotel rates in September up 67% vs. 2019.
Kauai hotels came in with an average daily rate of $398. Many visitors flocked to Kauai following the Lahaina fire.
September Big Island hotel prices climbed 69% compared with 2019.
Big Island hotels had an average daily rate of $373 last month.
Honolulu hotel prices remain the relative sweet spot in Hawaii hotel prices.
Honolulu hotels had an average daily rate of $270, up a more moderate 19% compared with 2019. Honolulu hotels are going up less than the other islands. As we said after last month’s report, “We wish we could say that this means excellent value can be found in Honolulu hotels. Unfortunately, even with these more modest increases, we still find Honolulu hotels overpriced and generally lacking in value.”
What’s your take on evolving Hawaii hotel costs?
Honestly, to us, Hawaii hotel costs are simply exorbitant and the value proposition is too weak. It is frustrating to travel in Hawaii, even for Hawaii residents who often get a small additional Kamaaina (local) discount. Look for some upcoming Hawaii hotel reviews we are planning in the months ahead. We invite you to share what is and isn’t working for you at Hawaii hotels by leaving a comment.
Ways to reduce Hawaii hotel costs.
We suggest that if you are trying to reduce hotel costs and are traveling in the off-peak season (August 10 to December 15, January, February, and April to June 10), wait for better prices. Since occupancy is not 100%, you may find a better rate within 90 days of your stay.
Avoid non-refundable rates to give you flexibility for last-minute changes. Are you willing to consider hotel properties a block or more from the beach, in Honolulu, for example, as rates tend to be lower at these properties.
Also check every possible source, and try bundling things and not, to see what works best. We just got a hotel and car together on Costco Travel that was cheaper than what we could get when booked separately.
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Hawaii mayor needs to reconsider the one month rental for BnBs . That is the answer to more tourists like we had before. Instead, they keep building more hotels .
Alohaprincess
Too bad we are grabbing money and not allowing a greater number of people to enjoy our islands.
Hi BOH,
I know it’s a tropical place, but caught six cockroaches in my room at the Sheraton Kauai over five days in September, couldn’t get out of there fast enough. Tough to sleep when you wake up to new cockroaches every morning. Saw fewer bugs in Kalalau when I camped there five nights after my hotel stay. Put towels under the doors each night, but that didn’t help.
Ripoff riptide boycott Hawaii hotels
For this reason amongst many others, short term vacation rentals are your best bet! Put some money back into the local economy instead of the pockets of these hoteliers who obviously do not care about a more affordable visit to our islands. Many stvr’s are owned and operated by the people of their respective community.
We look forward to welcoming conscious, respectful visitors to our homes. E Komo mai!
Short term vacation rentals are a double-edged sword. Some might contribute to the local economy, but far too many are owned by mainlanders as a second/vacation home, which actually harms the local economy because they remove available inventory from locals who need long-term housing.
Yes, you are absolutely right, Drew A.
Actually Drew, you are not really accurate. I am kanaka o’iwi (native Hawaiian) and I do own the home that I currently rent out as an stvr. There’s no way I could afford to still live here, In Hawai’i, my home and ancestral origin, if I didn’t share my home with visitors. I can schedule when I want to accept visitors as well as scheduling private time for family to come visit it’s a great way to bring in the much needed revenue to maintain my home and I am able to share our culture with my guests in an authentic and genuine way. Aloha at its best! It is a mystery to me why anyone would still want to stay in generic, overpriced, corporate hotels that exploit Hawaii and Hawaiians! What a rip off!
Also, long term housing for my situation, was never an option. There’s more than enough housing here! There’s a lack in affordable housing! Very little to do with those of us who share our homes with visitors, just sayin…
That’s really not true Drew although it’s a popular myth. I own two vacation rentals in west Maui in resort zones. One is in a 5 star resort where the units start at about $2 M. The HOA dues and fees are over $3,000 for my unit every month. The property taxes are $22,600 a year. The electricity is the most expensive in the world and the mortgage is huge. That’s probably why there isn’t a single full time resident in about 700 units. It’s certainly not a place a first time buyer would look. They could buy 3 homes for what one would cost them here.
I hope they would be conscious. It would be kind of a bummer if you were in such a beautiful place and the whole time you were unconscious. Jus’ sayin’ :0/
Sorry, I couldn’t resist! Just giving you a hard time, Wicked W.
LOL X0D
Are you from here RP? Have you ever tried to apply for a legal stvr in Hawai’i? If you are not a resident, it’s close to impossible to have one and make any kind of profit! The land tax alone would cripple you! Come on guys! Get your facts straight before you comment! That may have been the case at one time, but times are a changing! Big hotels have been ripping people off for long enough! Let’s support the local economy instead! And have an authentic Hawaiian experience while you’re at it! Bonus!!
Dear BOH. An analysis of hotel rates cannot be complete without a review of underlying expenses. Property taxes are based on assessed values. In addition, costs have gone up in all other categories: housekeeping, landscape maintenance, electrical and gas, maintenance and repair, entertainment, linens, admin staff.
We have decided not to return to Hawaii since our California dollars don’t seem to be welcome. We can cruise to Alaska or Caribbean for the same price as a trip to Hawaii and our tourism dollars feel more valued. This is sad since we really loved our many trips to the islands.
Susie,
If you enjoy your time in Hawaii, there’s no good reason to stop coming.
I live in SoCal and don’t feel the Aloha (at least 30 trips since 1965). But, that has not interfered with our enjoyment – my wife’s enjoyment. I like Hawaii but would like to take at least one trip to the Caribbean. The wife says she will only travel within the USA. I remind her that there are the American Virgin Islands. Not persuasive. So, I told her I’ll go with my girlfriend. She tells me a girlfriend would not put up with me.
Don’t let the idiot Gov of Hawaii and others ruin your good times. But, if the good times are mere memories, indeed, try the Caribbean – and take me.
Aloha
Thanks for the giggles. We cruised US Virgin Islands this year and it was beautiful. Just got back from New England. I, too, am concerned about traveling outside the US, so we cruised Alaska last year and New England this fall. Maybe we’ll expand our
reach and venture to British Islands next.
Glad you saw a little humor.
For me, it’s more serious – my wife is done traveling, and I’m not. We are in our late 70s, and the last 6 years have been hell for my health: cancer (gone) and multiple hernias, and those are the easy ones. And my incredible wife thinks I need to be treated with kid gloves.
But I love to travel, and we are at an impasse.
In spite of all of that, keep the giggles coming, wife and I will eventually reach a compromise.
We live in the high desert about an hour from Palm Strings. What about you guys?
Mahalo
Susie,
Did you have an experience in Hawaii that made you feel this way? Because, if you just read social media, I think you’re getting a skewed picture of what’s going on. I agree, hotel rates are ridiculous. However, with a 75% occupancy rate, and prices up 40%, the hotels are still making a bundle. If the hotels were locally owned, instead of by big mainland corporations, things might change/be different. But as it stands, greed wins out.
Joerg,
The people of Hawaii have been amazing and I have nothing but kindness for them and would love to support their tourist-base economy and support employment opportunities. I don’t look at social media for my information. It’s looking at decisions and statements of the state government and tourism board that make me feel this way. I encourage higher wages for employees and better working conditions, and would be willing to pay higher rates for those reasons. We all know that is only a small part of what’s driving the incredibly high rate increases. I would be willing to return to Hawaii when the rhetoric changes to welcome people who can’t afford to bring tens of thousands of dollars with us.
Hotel owners and operators are trying to maintain their profit margins after being forced to agree to union demands to increase wages and benefits. Don’t forget the state and county surcharges to generate revenues to cover government overspending. Somebody has to pay for it. Eventually workers will suffer when occupancy drops due to excessive prices and they get laid off. There are other places in US to vacation with sun and beaches that are more affordable especially when you factor in airfare costs.
That’s right, we have to maintain our profits by paying the locals starvation wages!
Yes, businesses do have to maintain profits. No profits = no businesses = no jobs.
And just what do you have against Mainlanders owning property? Hawaii is one of 50 states. How much profit do the big hotels make for every dollar of revenue?
A year ago I tried to hire locals for some work. I was offering $50/hour to count inventory. More than twice what I pay on the mainland – I got one Hawaiian worker and had to bring the rest from the mainland.
Shirt term rental of unused timeshare units. Redweek.com
I’m coming around New Years with my daughter as a surprise trip booked since June, pre-fire, visiting Oahu, Kauai and BI. I’ve got AirBnBs booked for 17 days across those three islands, as hotel costs are just comical. If one can manage the time to reach Hawaii, a reasonable flight cost can be found, but a reasonable hotel cannot. If Airbnbs get outlawed and hotel prices stay where they’ve gone to, this will be my last trip.
Well, we have a ‘yes it is, no it isn’t’ kinda situation here. On Maui, the big resorts don’t have to compete with the cheaper independents in Lahaina town anymore. They are all gone. The bad side is, Lahaina is no more, and it was a major tourist and cultural attraction for the West Side. I’m going to miss strolling the main street, taking in the art shops, t-shirt shops and various eateries. No more Wednesday night art displays, no more Kimos or Duke’s, not even Hilo Hatties. All gone.
Aloha Dennis !
We also miss everything about Lahaina.
The people of Maui we worry about and care for.
This is a tragedy that shouldn’t have happened.
The warnings were there.
Some good news,
Duke’s Maui is open, alot of their staff has been sadly affected but the restaurant is in North Kaanapali and is ok.
We all loved Kimo’s and to lose it is simply painful.
Take care, Safe Travels.
Well, I can tell you that I am one of the few that does NOT have the vacation mindset of being in paradise and just paying for the experience. I have saved for 5 years for my return to Maui. The Rates are way out of line. The younger generation r charging and will pay the price of that someday soon. I feel awfully bad that it took the fires to wake up the greedy minds. The supply and demand caused many more to follow suit even though they were against it, why not make money since everyone is charging up against the board. There have been a few that are not (as) greedy and it is refreshing to see. Many have reduced rates right now through December, but my heart felt loss of Lahaina and it’s the last place I want to go right now.
Forgetting Hawaii hotel room rates for a second. Are my employees any less greedy if they ask for large wage increase?
The UAW just reported a 25% raise for workers at Ford – are the workers greedy? Or just the employers? Will those workers show a 25% increase in productivity?
Don’t forget the exhorbitant taxes. I’ve found the room rates now similar to what I paid in my last couple visits btwn 2016-2019. Airfare same or cheaper. But those State and local taxes are offensively high and spoil the budget.
Thank you for keeping us in the loop. We want to return to Hawaii but with costs so high in every aspect of life, finding the best cost is imperative.
I wish Hawaii hotels would offer more discounts to Kamaaina especially when it comes to parking, resort fees and taxes! Getting a sweet deal for $245/night in Waikiki only to have the final charge of $311/night was not much of a deal at all!
I own and manage 2 luxury 2/2 vavation rentals in west Maui. I don’t have a full time staff and I’m either booked which gives me a means to pay the exorbitant costs of ownership or I’m vacant and pulling from savings to pay the bills. So I set prices to achieve 90+% occupancy and my historical numbers have been about 93%. I HAVE reduced rates substantially since the Lahaina fire. You can book my place for less than a luxury hotel room and you get 1230 square feet inside, 2 full bedrooms and bats, a yard, a kitchen, all at a top end resort. So, good value can still be had although it does take a lot more to get a good value on Maui than it does in say Mexico.
wish I knew your condo? I can;t come unless I get a deal as I have been saving for 5 years!
Aloha,
Your article is spot on. Why are the rates so high? 69+% increases since 2019? We love visiting Hawaii and frequenting the local restaurants, food carts and cultural experiences. Unfortunately, the hotel rates are not in line with supply and demand.
Well, now that hotel lobby has been successful in eliminating their Airbnb & VRBO competition by getting Hawaii mayor to require minimum 30 day stays in stead of the usual 7-day stays at short-term rentals…the hotels are now free to gouge tourists that have no other options. Oh, wait, they do, they can vacation elsewhere! Hope all of you who pushed for this..will explain to your neighbors and locals why they can no longer find good-paying employment and are forced to move off the island onto the mainland to lead more prosperous lives.
Wow, Lucy. When did the governor make this call about AirBnB’s 30 day minimum stay requirement? That would allow hotels to have the upper hand.
Thank you for sharing the information.
I forgot they actually tried to get the minimum rental period increased from 30 days to 90 days in April 2022. Guess 30 days was still taking business away from the large hotels. Fortunately, it was appealed and the U.S. District court judge granted the preliminary injunction to halt ordinance 22-7. 7 or 8 of the city council members were in favor of this. For those of you that are concerned, you need to look at what your reps are doing on your behalf. Kailua council member was in favor of minimum 90 days, said, tourists were a pain and not respectful of the neighborhoods etc…there were tons of locals that gave testimony saying just the opposite. I do not live on the island so not able to effect much other than giving virtual testimony.
Hi the 30 day restriction is for Oahu only. Not the other islands.
We were planning another trip to Hawaii in the spring 2025. Maybe it is time to check out Aruba or the US Virgin Islands…
Yes, Hawaii hotels are tremendously overpriced for the value proposition. Just like Disney, they are gouging. Disney parks are now empty with profits down and people are turned off and likely not returning. It’s a big world and there are far better destinations with higher value proposition as Hawaii’s uniqueness continues to fade away.
Apparently you haven’t been to Disneyland etc lately….i don’t know about the hotels but the parks themselves are quite busy. We were at Disneyland and California Adventure in April and the middle of September, when kids are “suppose” to be in school and the parks were packed every day, and we were there the middle of the week.
Corporate greed is an ugly thing that appears to be fouling up many aspects of life at the moment . The public expectation that inflation will increase the cost of products and services seems to provide open-season on common sense in pricing. They raise prices 3 times the current inflation rate for no reason other than greed and in the case of Hawaiian hoteliers then add a ” resort fee ” just to frost your biscuits !! Hawaii has soared out of reach for so many regular visitors that they have stayed away in groves but that hasn’t deterred the Hoteliers who stubbornly raise the prices further. I hope they come to their senses when Kalakaua is devoid of tourists altogether.
It is called greed. Same with what happened with the auto rentals. I was a frequent traveler to Maui after retirement, but not anymore. I can fly to Panama which has better fishing, half of the flight time, and super nice lodging, on the water, for $200-250 per night.
I would like to see all major hotels give “substantial” kama’aina rates.
Many, I know, would be close to home, but “get out of the house”, for a few days.
Only a few offer discount. But hardly negligible.
Love living Hawai’i
Aloha,
Sharon B.
The hotel price increases are ridiculous and have had a very negative blowback for other businesses trying to survive on the islands. Just because the hotels can cut staff due to the lower occupancy does not mean the small businesses that rely on tourists can do the same thing. If Honolulu gets it why can’t the other islands?
This kind of greedy thinking will have a very negative impact on all of Hawaii.
Who pays $600+ a night for a hotel room? Seriously, are these all very wealthy folks or people that are just running it up on the credit card and hoping to pay it off?
Hotelier: “You mean I can have fewer guests, less housekeeping, infrastructure and staff costs, and take in the same gross revenue? Sounds like a good idea to me!”