Are Airbnbs Banned in Hawaii? New Law Aims to Crack Down on Short-Term Rentals

Airbnb listings and other short-term vacation rentals in Hawaii are moving closer to phasing out rentals as the state grapples with a housing crisis exacerbated by last year’s Maui wildfires.

A bill with the potential to overhaul the state’s vacation rental regulations passed the state Senate and House of Representatives on Wednesday and now awaits the signature of Hawaii Gov. Josh Green, who has already promised to sign it if it reaches his desk. If signed, the new law would go into effect Jan. 1.

SB2919 would give each county in Hawaii the authority to redefine zoning laws, including converting short-term rentals to long-term housing, to “guide the overall future development of the county.” Those who violate the law would face a $10,000 per day fine.

According to Hawaii Senator Jarrett Keohokalole, who introduced the bill, it won’t be a major change overnight, but it is the first major legislation regulating short-term vacation rentals statewide.

“It’s huge,” Keohokalole told USA TODAY.

The bill essentially reverses a 1957 ordinance that displaced Native Hawaiian communities from their homes and converted their land to sugar plantations. Many of the other zoning laws are outdated, Keohokalole said, and don’t reflect the influx of foreign investors or overtourism.

Should I visit Maui now? Maui businesses ask for responsible tourists to help economy after fires

“We know that the majority of STRs (short-term rentals) in Hawaii are illegal, owned by non-residents and contribute to skyrocketing housing costs,” Governor Green posted on Xformerly Twitter, last week. “We support Senate Bill 2919 to give counties the authority to regulate and potentially phase out STRs.”

Housing affordability in Hawaii has worsened over the past two decades. A single-family home will cost four times as much in 2023 as it did in 2000, and fewer than a third of households can even afford a typical local home, according to the Hawaii Housing Factbook from the Economic Research Organization and the University of Hawaii. Rents also continue to rise, with Maui having the most expensive median rent in the state, with a typical apartment costing $2,500 a month.

Part of that is due to the high percentage of short-term rentals in Hawaii’s housing stock. About 30,000 of Hawaii’s 557,000 total housing units, or 5.5 percent, are short-term rentals, compared to cities like Las Vegas, where only 3 percent are short-term rentals, the report found. It’s even worse in Maui, where vacation rentals make up 15 percent of the island’s total housing stock.

The August wildfires that devastated much of Lahaina and displaced thousands of West Maui residents only exacerbated Maui’s housing crisis. “With Lahaina, we’re in an emergency situation,” Jordan Ruidas of the Native Hawaiian-led community organization Lahaina Strong told USA TODAY.

“The fire has burned down most of our workers’ housing,” she said. “We are in ruins and people are still waiting for long-term housing.”

Ruidas said about 3,000 displaced residents are still living in hotels, more than eight months after the fires ravaged West Maui. Some are leaving Hawaii altogether because of the lack of stable, long-term housing.

“What has become more apparent, at least in Lahaina and the surrounding community, is that so much of the housing stock on that part of the island has been converted to vacation rentals that survivors are struggling to find a place to live,” Keohokalole said.

Maui County Mayor Bissen has said he wants to “increase the supply of available long-term housing for the people of Maui” and in November even proposed tax breaks for owners to convert their homes into long-term housing.

“It’s not an inventory problem, it’s the fact that the inventory is being used for something that doesn’t help the community,” Ruidas said.

Kathleen Wong is a travel reporter for USA TODAY based in Hawaii. You can reach her at [email protected].

This article originally appeared on USA TODAY: New Hawaii law cracks down on vacation rentals amid housing crisis