Hawaii Travel Update: The Governor And Mayor Just Proposed Getting Rid Of Short-Term Vacation Rentals On Maui

29.11.2023 - 09:03 / forbes.com / Richard Bissen / On Maui

One way or another, you probably won’t be renting an Airbnb or VRBO on Maui anytime soon.

This week, both the Governor of Hawaii and the Mayor of Maui indicated that the solution to finding long-term housing for the more than 6,000 residents still displaced from the August 8th Lahaina wildfire is to incentivize - or perhaps even force - vacation rental owners to rent to them.

In separate proposals set to be heard soon by Maui officials, the Governor and Mayor laid out potential plans for short-term vacation rentals to be turned into long-term housing.

First, the Governor. He laid out two options, which you can read in full here. In option 1, vacation rental owners would be (highly) motivated by the government to rent long-term to residents by offering them eye-popping, above-market rates: $5,000/month for a studio or one-bedroom home, or as much as $11,000/month for a four-bedroom home.

In option two, short-term vacation rentals would be banned altogether for the next 18 months, while providing similar above-market compensation for renting to displaced residents.

Both plans also include incentives for land owners to build accessory dwelling units on their properties to increase the total number of available solutions.

The Mayor’s plan, while slightly less aggressive, would exempt vacation rental owners from paying property taxes if they rent to residents. However, vacation rental owners who do not follow suit would be taxed more, according to the proposal.

“By converting short-term units to long-term rental properties, and renting them to residents who have been displaced by the disaster, owners of Maui’s thousands of short-term vacation rentals, timeshares, and non-owner-occupied homes will be exempted from paying real property taxes,” Mayor Richard Bissen said.

In any of the above scenarios, vacation rentals would become more or less unavailable to visitors, either due to the legality or financial implications at play.

The introduction of these ideas, which need to be debated and discussed by Maui county officials prior to approval, comes as residents continue to be removed from hotels without an approved plan for long-term housing while protests from local community groups take place on popular beaches.

To say that Maui has been a mess in the wake of the August 8th wildfire that destroyed the town of Lahaina, killed about 100 people, and displaced thousands and thousands of residents would be an understatement.

The reopening of Maui to tourists was anything but smooth, and the island’s tourism-dependent economy has struggled mightily to balance the needs of residents with the pocketbooks of visitors. Indeed, some Lahaina residents have been forced to leave Maui altogether due to the lack of