Hawaii homeowners and renters have debated for years with policymakers about units in residential zones used for short-term occupants and vacationers. According to figures in the Hawai‘i Housing Factbook 2024, vacation rentals still represent 6% of the statewide inventory, regardless of efforts to rein them in.
It seems that only now is there resolve to curb the practice that has contributed to the dearth of affordable housing for Hawaii residents — especially on Maui, where it took a crisis of tragic proportions to force the issue.
At a meeting set for 9 a.m. today, the Maui County Planning Commission will take up a proposal by Mayor Richard Bissen to phase out a long-established exemption that allowed about 7,000 vacation rentals in residential areas.
This move is long overdue, and it likely wouldn’t have happened without the Aug. 8 wildfires that devastated much of West Maui and left thousands of residents homeless.
County officials over the decades have allowed a lax land-use policy to languish for far too long until now, when the needs of long-term residents clearly must take precedence.
The policy dates back 25 years, when Maui County enacted an ordinance barring vacation rentals in apartment zones, but exempted properties that were developed before 1989.
That carve-out “grandfathered” permission for some 7,000 Maui vacation rentals in these established units, generating a list named for the county attorney, Richard Minatoya, who wrote a legal opinion setting out the exemption.
If the commission advances Bissen’s proposal, as it should, the result could be the conversion of about 2,200 vacation units on the “Minatoya List” to long-term rentals, providing significant relief from the current housing shortfall.
However, it’s anything but certain how soon this could happen. Although the mayor contends that most of these West Maui units were originally intended as workforce housing, there is a credible argument that most were condos developed for resort use.
Before there is any final disposition here, then, Maui County officials must consider whether some of these units are more suited as resort properties, among them the three condo projects at Kapalua Resort. Part of the reform should be to right-size the apartment zone, redesignating as a resort zone those areas more appropriately suited for tourist rentals.
But without a doubt, even small, studio-sized units should be considered as a valuable part of the housing inventory for long-term residents. There is a demand for homes sized for small households: Single renters move into the community to be close to jobs, and couples or even families of three can manage in minimal space.
The countervailing force against this conversion comes from unit owners who have been allowed to repurpose residential units as revenue-producing businesses in the visitor industry. Vacation bookings turn over quickly, making them far more lucrative than conventional landlord-tenant leasing.
The same pressures intensified years ago on Oahu, where city government has struggled, also since 1989, to rebalance its land-use policies. After many false starts, the Honolulu City Council has narrowed short-term rentals to resort zones and to some 800 units that were grandfathered in for bed-and-breakfast or whole-home visitor bookings.
Now, finally, it’s good that the Blangiardi administration has begun stepping up enforcement of its ordinance cracking down on Oahu’s illegal units, launching a registration platform and allowing resident surveillance to help with oversight.
All these developments are encouraging. Even with the realization that regulation will require adjustment over time, it is a relief to see officials making a start.