HONOLULU — Amy Chadwick, a single mother of two, worked hard and saved for years before purchasing a home in the town of Lahaina on the Hawaiian island of Maui. However, after a horrific fire destroyed Lahaina in August, Chadwick’s home was reduced to white dust, and the cheapest rental she could find for her family and dogs was $10,000 per month.
Chadwick, a fine-dining server, relocated to Florida to stretch her homeowner’s insurance costs. She’s concerned that Maui’s expensive rental prices, fueled in part by holiday rentals that dominate a limited housing supply, may hollow out her close-knit community.
Hawaii Lawmakers Take Aim At Vacation Rentals After Lahaina Wildfire Amplifies Maui Housing Crisis
Most individuals in Lahaina work for hotels, restaurants, and tour businesses and cannot afford to pay rent of $5,000 to $10,000 per month, she added.
“You’re displacing an entire community of service industry workers. So no one will be able to sustain the tourist that you’re prioritizing over your town,” Chadwick said over the phone from her new home in Satellite Beach on Florida’s Space Coast. “Nothing positive will come of it until they take a firm stance, putting their foot down and effectively regulating these short-term rentals.
The August 8 wildfire killed 101 people and destroyed houses for 6,200 families, exacerbating Maui’s already severe housing scarcity and exposing the massive number of holiday rentals in Lahaina. It reminded lawmakers that short-term rentals are a problem throughout Hawaii, prompting them to pursue legislation that would give counties the ability to phase them out.
During a recent press conference, Gov. Josh Green became so frustrated that he shouted out an expletive.
“This fire uncovered a clear truth, which is we have too many short-term rentals owned by too many individuals on the mainland and it is b———t,” Green said in a statement. “And our people deserve housing, here.”
Vacation rentals are a popular alternative to hotels for individuals looking for kitchens, lower pricing, and the chance to experience ordinary island life. Supporters claim they enhance tourism, the state’s largest industry. Critics accuse them of raising housing costs, upsetting neighborhoods, and contributing to the dynamics that drive locals and Native Hawaiians to flee Hawaii for less expensive places.
This migration has become a big issue in Lahaina. According to the Council for Native Hawaiian Advancement, a charity, at least 1,500 households have departed since the August wildfire, accounting for a quarter of those who lost their houses.
The fire destroyed single-family homes and apartments in and around downtown, which is the heart of Lahaina’s residential community. According to a study conducted by the University of Hawaii Economic Research Organization, holiday rentals accounted for only 7.5% of all units in February 2023.
Lahaina communities that were spared from the fire have a considerably larger ratio of vacation rentals. Short-term rentals account for roughly half of all housing in Napili, located around 7 miles (11 kilometers) north of the burn zone.
When Chadwick began house hunting in 2016, she thought she had discovered a place to buy in Napili. However, a Canadian woman secured it with a monetary offer and converted it into a vacation rental.
Outside the burn zone, there are scores of short-term rental condominium structures built decades ago on apartment-zoned land.
Hawaii Lawmakers Take Aim At Vacation Rentals After Lahaina Wildfire Amplifies Maui Housing Crisis
In 1992, Maui County explicitly permitted owners of these buildings to rent units for less than 180 days at a period, even without short-term rental permits. Since November, demonstrators have seized the beach in front of Lahaina’s largest hotels, urging the mayor or governor to exercise their emergency powers and rescind this exemption.
Money is a major incentive for owners to rent to travelers: according to 2016 state data, a Honolulu vacation rental earns 3.5 times the revenue of a long-term rental.
The Housing Committee chair, State Rep. Luke Evslin, stated both Maui and Kauai counties have experienced net losses in residential housing in recent years due to a lack of new building and the conversion of so many properties to short-term rentals.
“Every alarm bell we have should be ringing when we’re literally going backwards in our goal to provide more housing in Hawaii,” he told the crowd.
In his own Kauai district, Evslin sees people fleeing, becoming homeless, or working three jobs to get by.
The Democrat was one of 47 House members who cosponsored a bill that would phase out short-term rentals. One goal is to give counties more authority after a US judge found in 2022 that Honolulu violated state law by attempting to limit rentals of fewer than 90 days. According to Evslin, this ruling left Hawaii’s counties with minimal means for controlling holiday rentals, such as property taxes.
Lawmakers also proposed increasing Hawaii’s housing supply by requiring counties to allow additional houses to be built on individual lots. However, they scaled down the legislation after local officials stated that they were already investigating the notion.
Short-term rental owners claimed that a phase-out would violate their property rights by taking their property without compensation, potentially forcing them into foreclosure. Some anticipated legal issues.
According to Alicia Humiston, president of the Rentals by Owner Awareness Association, several communities in West Maui were created for tourists; thus, they lack schools and other facilities that families require.
“This area in West Maui that is sort of like this resort apartment zone — that’s all north of Lahaina — it was never built to be local living,” he said.
Hawaii Lawmakers Take Aim At Vacation Rentals After Lahaina Wildfire Amplifies Maui Housing Crisis
According to one housing advocate, just because a city allowed vacation rentals decades ago does not imply it should still do so now.
Courtney Lazo, a real estate agent and member of Lahaina Strong, the organization that is occupying Kaanapali Beach, says tourists can now stay in her city, but many locals cannot.
“How do you expect a community to recover, heal, and move forward when the people who make Lahaina, Lahaina, aren’t even there anymore?” she asked at a recent press appearance, her voice quivering. “They’re moving away.”
SOURCE – (AP)
