Thousands of vacation rentals will be phased out of existing in Maui’s apartment districts under a new bill passed Monday.
The measure in question, designated as Bill 9, begins a process to phase out the use of transient vacation rentals in apartment districts across the county. Under the bill, vacation rentals will no longer be permitted to exist in apartment districts in West Maui after the end of 2028.
Vacation rentals in apartment districts elsewhere in the county have a little more time, but will not be permitted after Jan. 1, 2031.
Previous rules allowed vacation rentals to operate in apartment districts so long as the building in question was properly permitted and had allowed vacation rentals prior to Sept. 24, 2020. However, after Jan. 7, 2022, no apartment building could increase the number of units available for vacation rental use; existing units could only be renovated or expanded.
This effectively ends an exemption granted to more than buildings and residential complexes throughout the county. Since 2001, the county has maintained a list — referred to as the Minatoya list — of all the apartment-zoned condominium properties that have been grandfathered into the county’s legal short-term rental market.
The prospect has been divisive, and Councilwoman Nohelani U‘u-Hodgins issued a statement in advance of Monday’s meeting assuring residents that some of its impacts may be mitigated.
Another meeting of the council is scheduled for Friday, Dec. 19. At that meeting, councilmembers will discuss a resolution, proposed by Councilman Tom Cook, that would establish new hotel districts that would allow for temporary vacation rentals outright.
These new hotel districts would exclusively be applied to properties on the Minatoya list, allowing for vacation rental units to continue operating even after the deadlines in 2028 or 2031.
If Cook’s resolution passes, U‘u-Hodgins said in a statement that she plans to initiate council-initiated zoning changes for some 4,500 units that have been identified as appropriate for continued use as temporary vacation rentals.
“Throughout this process, we have sought to pursue an outcome that will benefit Maui County’s residents by promoting housing availability while stabilizing the economy,” U‘u-Hodgins said in her statement.
At a previous meeting on the bill, Councilman Shane Sinenci said that the vacation rental units currently within apartment zones on Maui only account for about 13% of all short-term rentals in the county.
Many celebrated the bill’s passage on Monday or urged the Council to vote in support.
Jordan Hocker told the Council Monday that the proliferation of short-term vacation rentals has a direct causal relationship with an increasing number of Maui residents leaving the county or state due to rents rising to unaffordable heights.
“Our people cannot afford to live here and it is partially because people could not resist that return on investment,” Hocker said.
While some celebrated the bill’s passage on Monday, others voiced concerns about the economic impact to vacation rental operators and the county as a whole.
Vacation rental owner Jeff Gilbert said that eliminating or curtailing short-term vacation rentals will simply reduce or remove opportunities for vacationers to visit Maui at a certain price point.
“If I were able to economically work my unit as a long-term rental, I would be there,” Gilbert said. “I don’t like having to go through guests every week, that’s a lot of work for me.”
But, Gilbert said, long-term residential rents are simply not sufficient to cover the regular costs of owning and maintaining a rental unit.
“We are deeply concerned about the significant economic harm to local residents and small businesses if Bill 9 is implemented in its current form,” read a statement by Glenna Wong, spokesperson for travel company Expedia Group.
The Council ultimately voted 5-3 in support of the bill, with Chair Alice Lee, Vice-Chair Yuki Lei Sugimura and Councilman Tom Cook voting against.
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