Maui has unveiled plans to drastically curtail the island’s vacation rentals. This brazen initiative, aimed to help fix Maui’s severe housing shortage, will eliminate more than 7,000 term rentals in the next 18 months.
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255 thoughts on “Thousands Of Maui Vacations Rentals First To Be Cut”
What will be the compensation for timeshare owners?
Rant: I live on Oahu and they screwed us here, too. And the Hotel industry is laughing to the bank as now they have the monopoly again. This is America, right? Who is the corrupt government to tell citizens what to do with their properties? Block foreign investors. Or even block the mainlanders if you want. But not those who live here. We need money to deal with the outrageous living expenses and low wages that we incur. Try working on that instead. This is 100% total garbage. Shame on you, mayor of Maui and all the other bought state officials who push this on us.
Shame !!!!
Totally agree. All the ineptitude of governing this island over the years is compounded by more bad decisions.
Since I have been here, I have seen development after development rejected for this that or the other reason… but it’s the fault of all of us local Condo Owners?
This decision… if it moves on to completion will destroy the economy.
Think about these numbers (they are conservitive). 7000 units x 40 weeks= 280k visitors. If they each spend 5k on their vacation=140m into the economy.
How will they make up that loss? Tax us local people even more?
Yep. Count on it. They are not just going to lay down and say “Gee, hundreds of millions of dollars lost in our county budget…oh, well…”
Their only revenue is through taxes. They will take from one bucket to make up for another. Hotels are off-limits, so that leaves the non-owner occupants, the LTRs (which will be reflected in the rents) and the owner-occupants.
But you’ll have a bunch of empty, neglected condos! Yay!
The entire concept of trying to get 7000 individual condo owners to rent long-term is absurd. If I charge $3000/month in rent, and pay $1000/month maintaining the property, to even make it economically feasible, I have to have a mortgage payment of less than $2500/month. That means all of these units have to sell in the $350,000 range for this idea to work. Nobody is buying a Kapalua Bay Villa for $3M and renting it for $3000/month.
What is needed is brand-new commercial apartment buildings. That is the only thing that will work.
Exactly right. We now have entitled locals that believe that they should be given homes when they were renting shoddy rooms in someone else’s 13 bdrm 5 ba house. I understand helping the owners that lost homes & temporary housing for all victims. But indefinite free housing at the cost of others is unfair. I pay my insurance & if I didn’t would accept consequences not expect someone else to buy my new home. Most were renters. They can live anywhere but many have refused free housing if they have to drive 30-40 minutes. These include members of Lahaina Groups. Easy to fight if u hv nothing to lose & all to gain.
Extreme overreach by bureaucrats who are willing to destroy one of the basic concepts and rights of American citizenship. The right to own and control personal property. This will leave current deeded owners holding the bag for this power grab as a result of dismissed property values current deeded owners will never be able to recover their investment in the property. In addition to other issues mentioned on this site there will be an increase in vacant and unmaintained properties and properties will be scooped up at bargain basement prices by slum lords and close associates of the current administration, who will then get rich at the expense of current owners, the new renters, and tax payers.
Property value drops will be in the condo sector. There will always be buyers with money. I don’t see it becoming a slum. Many will have to leave islands for lack of jobs. Buyers with remote jobs will move in. Many Californians since values are similar & remote jobs became popular during Covid. There have been more buyers looking than inventory. We will soon have the inventory. Many of my recent neighbors live here part time & homes sit empty when not in use. When/if the hotel resorts build in Lahaina town it will provide more jobs. After much pain Maui will recover, just not as hoped for or promised. We’ll just lose visitors that truly love us.
How does this affect timeshare owners? At least some of these properties are owned via deeded week and used by their respective owners. I don’t think you can just take someone’s property from them.
Not sure what to do about Maui. Government officials don’t seem to be able to manage themselves out of a paper bag and politicians there are even worse.
Thank you again Pat!
How can they do this when we have and actual deed to the property? Talking of the Kuleana
There are 2 sides and we have heard some very good reasons why the ST R’s should remain on the other hand what do you expect these families to do who work in the service industry? I feel that there will be pain on both sides while the situation is figured out. You can’t run most business’s without employees and you also need a buying public to sustain a business, the solution can’t be all one way or the other.
They won’t need housing without a job. This move will simply increase the gap between the upper and lower class. Many of those condos will just sit empty until the owner of their friends use it.
If you think these families are gonna live in a 1 bdrm 1bath you are mistaken. Most of these complexes were not built as apartments. They are resorts with very little storage or parking. This decision will increase the gap between the haves and the have nots.
Aloha and good luck Maui. I understand the need for housing local residents. What I do not understand is how the community expects to go on without tourists and the money flow they supply? Where are the residents going to get money to make rent without jobs? Who is going to set rent? Tax revenue, job loss, political games…as usual the brunt of this legislation will be born by the people it intended to help and tourists. Maybe Bissen and Govenor Green get off Scott free and as heroes. It’s all good until it isn’t.
I own an STR. Last year I paid the State of Hawaii approx. $15,000 in
TA & GE taxes.
I also spent approx. $15,000 in housekeeping and maintenance.
I have no reason to believe that these amounts are not fairly typical for the average STR.
Multiply either of these amounts by the 7,000 units that are to be eliminated on Maui and you get some really big numbers.
This impact does not include the reduction in real estate taxes as properties are no longer taxed at the Vacation Rental rate.
Someone hasn’t done the math.
I haven’t seen how the rental rates will be set or
How you approve of the renter and group size.
Most STR are designed to be used by the week.
Furnished
Now by the year. Where will their belongings go,
Board s , bikes, & kitchen.
How will the STR owner
Protect and control his property. (S). Can he evict. I doubt it.
The state can’t force the 7000 owners to remain landlords.
Good luck evicting here, even with court & police reports. Landlord tenant problems already happening. Check credit reports. Those with great credit might not want it dinged. Then again without jobs, they won’t have a choice. Maybe they will pay their credit cards to save their credit but stop paying rent since they won’t be evicted. That’s a thought. I wonder if mainland owners can live here 6 mos + 1 day a year & be able to vote. How long has your condos been vacant? Haven’t you been living here during that time? We need more voters!
Kim, thank you for your informational comments.
One that was especially useful was asking more people who are afraid or reluctant to share their stories with Maui Council to do so.
Workers and vendors tied to tourism currently experiencing extreme anxiety of losing their work, and in turn their homes. Then must leave the island… LTR Landlords of workers in tourism will also be impacted due to missed rent payments, not just STR landlords…
Many are afraid of speaking up at the council meetings due to the pressure or harassment or backlash of sharing their own personal stories. Unfair/Unkind!! Everyone deserves to be heard, not just the Loudest (anti-STR).
Gave a list Councilmember emails to get the ball rolling.
I think many owners are trying to figure out how to keep their condos. And some are thinking of moving to Maui for 6 months + 1 day. You will get lower taxes if owner occupied, there was a senior tax rate too. You won’t be able to write off your HOA’s. Your Other state collects it tax too.
It is too soon to know exactly who they are going shut down…and when but they don’t need all STR’s to clo…I find it frustrating as we all do, that they tease with bits of info and take so long to actually say anything concrete, are they going to close everyone down? lots of nervous speculation…we are not on the MINOTOYA List, .But next door to us is, Makes no sense. And how do timeshares fit in? More corporate $?
There is a new article out today that suggests that insurance companies are leaving Hawaii behind. Green is blaming the oldie but goodie climate change but secretly knows it is mismanagement of infrastructure. He intends to resurrect his Green Fee for the tourists $25 that he will use to cover the loss of insurance. The problem is every time this fee gets brought up the intended use is for something different. This show will be interesting to watch from afar
Climate change is always the excuse/answer but the smart people know the truth
Jorge….if you believe that owners are saying the sky is falling…and that in your opinion, is not accurate…well we shall see won’t we? I don’t trust Green or any of them, they have no plans and what words they say change frequently. Reminds me of “ohh this covid, it will be gone in 2 weeks, just puff! And gone” The first week it was “we will use your unit for `12 month and pay you” .next week “18 months” and the next week it was 24 months, and now last week they are saying the people will be in their temporary homes for 5 years. Yep No Plan!
Unfortunately they will be placed in homes, FEMA will stop paying and owners will not be able to evict. Let’s get the lawyers involved now and include loss of wages due to our economy being deliberately destroyed.
Kim, that’s amazingly astute. I have friends who’ve known people from other FEMA supported disasters, and that’s exactly what happened. FEMA just up and left, leaving people like what you’re referring too, holding the bag.
Appeals:
“[T]he right of a property owner to the continued existence of uses and structures which lawfully existed prior to the effective date of a zoning restriction is grounded in constitutional law.
“[D]ue process principles protect a property owner from having his or her vested property rights interfered with, and preexisting lawful uses of property are generally considered to be vested rights that zoning ordinances may not abrogate.”
–Hawaii Legal Short-Term Rental Alliance v. City and County of Honolulu et al, Civil No. 1:2022cv00247 (D. Hawai’i October 13, 2022) (additional citations omitted).
There are vast areas of land between Kihei and Wailuku that could be developed for low cost housing but the ban on short-term rentals has nothing to do with housing and everything to do with eliminating competition from price-gouging hotels. How many of the workers who clean those “7,000” STRs will lose their jobs which, I suspect pay more than most hotel employees’ incomes? How many STR owners are willing to take a significant financial hit as well as losing day-to-day control over maintenance of their investment? The whole thing stinks.
I paid 250-350 a cleaning when I was a property manger for 3-4 hours work. They did do the laundry and had to buy supplies and equipment but if I had the strength, that is a pretty good job. Shops, restaurants, activities; everything else will be affected with less tourist dollars coming in to sustain us. This is stupidity or a plan to destroy our economy for what reason? Me thinks they will be building more hotel resorts including in our beloved Lahaina town.
I have done a lot of reading on precedents for STR elimination, and what happened as a result. Here’s what I think will happen.
1) This latest Maui bill will pass muster in Planning, County housing committees, and finally full County Council. I have not heard of any dissenters among these groups.
2) Hundreds, if not thousands of lawsuits will be filed, and a temporary injunction will be issued on the new law, until it can be examined by the state and US judicial courts.
3) Years will pass, with the ultimate result being that at least current STR use will be allowed to continue. Very few have been able to remove explicit, vested rights, which the Minatoya decision has codified.
I agree Pat and hope you are right. I have watched the meetings and am stunned but since the members are mostly local Hawaiian, they have family and friends to answer to when voting. Your input always makes sense and is well thought out. Please run for office. I’ll vote for you!
The comments section here is like one big echo-chamber of realtors, off-island speculators, property managers and other speculators all complaining to each other about their “investments”.
Hmmm all hard working, educated professionals. We are more than that. We are trying to save our island from more disaster. May I ask if you live here, own a home and what profession you are in?
Why does the government put the burden on the owner? Why doesn’t the government build more affordable housing instead of making it our problem? What happened to all of the funds raised from the fire? How do they expect the people to pay for housing when the jobs that STR’s create are gone? What is going to happen when tourists try to come over and there are not enough rentals? It has happened to me many times before I moved here years ago. I had to plan my vacation according to availability here. Have you thought of the impact on people who planned retirement around funds they would collect from the rentals. What are the big hotels giving up? It’s a shame.
“Affordable housing” is also known as “low income housing”. Hawaii is suffering from a severe shortage of the workforce from doctors, nurses, engineers, planners, mechanics, policeman, electricians….on and on and on……all through the income band. They will not qualify for low income housing. Housing prices and rents have become so absurd that everyone is leaving and nobody is in-migrating. Business are failing. The government cannot find workers.
STRs create a few average jobs, but displace many more from the local neighborhoods. They need to be banned from all residential zoning.
Maybe you should not have speculated in the housing market. Not all investments are guaranteed a return, including yours.
You’re certainly consistent. I have homeowner friends that are doctors, teachers, mechanics, an engineer for the state & neighbors that are policemen & firemen. They saved up & qualified. Yes we need more affordable housing. Perhaps low income housing is what you are in need of. I agree with banning STRs in residential & any new ones. I disagree with taking away current owners rights or devastating the economy. Job loss will not qualify for rent or buying. Loss of taxes will be our burden. Take away these rights and what’s next? Laws can’t be changed at will.
Really. Anyone auditing Lahaina Strongs funds? Why do the hotels pay less tax than any other entity but have more rooms? Property tax alone, not counting TAT, MTAT, GET and income tax for 2023: STRs paid 160m, second homes 110m, timeshares 41m, hotel/resorts million. Source Maui County Real Property Tax.
Tourists book rooms before coming, no room, they won’t come. It is more than a shame. It is criminal. Sad for those that drank the Kool Aid and believe this will be a good thing. All will be impacted negatively.
Unbelievable!
Who will set the new rental rates? The Government?
They can’t force owners to rent out for less than their monthly financial responsibilities. HOA alone wouldn’t be considered affordable at many places. 500-2000 HOA, plus mortgage, utilities, maintenance, insurance etc.. will not be affordable. Plus there are unemployed now and will be more. They will not qualify to rent or buy> Only truly purpose built or approved affordable housing will rent to these people. Build affordable housing. Give the Hawaiians land the state has been holding. Cut the red tape! Politicians don’t care about the loss because it won’t affect their paychecks.
Can the government only do one thing at a time? Their lack of planning with respect to housing was exposed by the Lahaina fire. We spend most of the year in a vacation destination in Michigan. While our housing issues are in no way 100% resolved, we have low income apartments and homes you can purchase at 50% of construction cost (the balance is paid by a government grant). The resort near our home had issues finding enough staff and as a result, the resort built housing for their workers. I think this happens in Hawaii, too? Seems like hotels could be a bigger part of the solution, especially since they would benefit greatly from a STR ban.
I think this is short-sighted decision-making by politicians looking to get reelected. It seems clear that short-term rental prices are going to go up even more due to the cut in supply.
Will it relieve the housing crisis? I doubt it. The potential unintended consequences are so many that it will be interesting to watch from afar. Many of these units were Never built to be long-term rentals (Eldorado and Papakea, for example). I don’t see how they survive at an affordable price point — they certainly will not be maintained as they are now. And Kihei will not be the same. That’s a shame.