The Hawaii State Legislature is mulling banning unoccupied short-term rentals on the islands through a pair of bills that are now working their way through the Senate and the House of Representatives.
Legislators in each chamber previously proposed two bills, specifically State House Bill 1838 and Senate Bill 2919, which would permit counties to implement a zoning ordinance to amortize or phase out non-conforming single-family short-term rentals. The bills are now moving through the Legislature.
The possible ban on short-term rentals was first floated after the devastating wildfires in August 2023 razed through the Maui town of Lahaina, killing over a hundred people and destroying around 4,000 housing units. This exacerbated the island's housing crisis, which already lacks affordable housing units for full-time residents.
Hawaii's Housing Crisis
Hawaii residents have long complained about the impact of tourism and vacation homes on housing accessibility. Short-term rentals have been built on large swaths of land that could have been the site of affordable long-term rental units.
For instance, in Lahaina, 25% of the region's housing units are listed as short-term rentals. This goes up to 41.8% south of Lahaina and a whopping 87% to the north, according to data from the University of Hawaii Economic Research Organization.
"Short-term rentals in Hawai'i have proven to be more profitable than renting to local families, but this profit often comes at the cost of the communities where they're located," Gary S. Suganuma, Director of Taxation, said in support of the House bill in March testimony, as quoted by ABC News.
This housing crisis has fueled an "out-migration." In the 2020 census, there were more people of Native Hawaiian ancestry living in the country's other 49 states compared to those living in Hawaii.
"Preserving long-term housing inventory for residents can prevent the out-migration of Hawaiians and other members of our communities, who are forced to leave due to the increase in lack of affordable housing options," Suganuma said.
Should the bills be signed into law, the measures would affect short-term vacation rentals in housing units constructed for long-term, permanent housing, such as single-family homes and condominium units outside of resort areas. However, condo hotels and commercial vacation rental communities are unlikely to be affected, per Fodor's Travel.
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