With More Than 6,000 Residents Still Living In Hotels On Maui, Governor Threatens To Halt All Short-Term Rentals In January

16.12.2023 - 16:51 / forbes.com / Josh Green / Richard Bissen / On Maui

Hawaii Governor Josh Green said he is ready to “drop the hammer” or go “nuclear” on short-term housing rentals on Maui.

Speaking Friday in Honolulu, Green laid out his disappointment with the lack of available and affordable housing for displaced residents who lost homes in the August Lahaina wildfires, and said he may declare a moratorium on all short-term rentals on Maui in January if these housing needs are not met.

As of this writing, more than 6,000 Maui residents are still being housed in hotels, and officials believe housing them in units currently being used as short-term rentals is the answer.

Late last month, both Governor Green and Maui Mayor Richard Bissen proposed incentivizing the owners of Maui’s 12,000 short-term rentals with tax breaks if they convert them into long-term housing for locals. Some of the proposed tax breaks were subsequently approved by the Maui City Council via two bills earlier this month.

On Friday, he said that while some owners have been open to the idea of converting their units and accepting the tax breaks (as well as the lucrative rental rates), others have resisted the idea of being told what to do with their property.

“We have had multiple individuals share with us insinuating comments that they shouldn’t be forced to change their model, that that’s their right to rent to whomever they choose,” he said at the press conference.

Angered and visibly disappointed, Green said that he is willing to “drop the hammer,” or completely shut down, the short-term rental industry in January if 3,000 units don’t volunteer to participate in the program.

“I’m sure we will face litigation, but I will do it if we don’t get 3,000 units for our people who have been living in hotels,” he said. “It’s not civilized to make people wait to get housing after they’ve lost their home to a fire. That may be viewed as fairly controversial, [but] not from the perspective of someone who’s got a family of five or six people and they’ve been living in a hotel room. They need to be helped. So I’ll do that if necessary.”

The next month will be crucial toward the final outcome. If enough volunteers come forward, a majority of the short-term rental industry will be able to continue renting to visitors.

However, if a moratorium is put in place by the Governor, things could get tricky. There’s been no talk of how a moratorium would affect reservations already booked for, say, the end of January and February.

Governor Green also announced during the conference that families who lost loved ones in the fire could be eligible to receive a $1.5 million payout in February as damages. By accepting the payout, families would waive part of their ability to sue entities responsible for the fire, however.

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