Hawaii Allows Counties to Turn Short-Term Rentals into Long-Term Housing

Governor Josh Green of Hawaii has enacted Senate Bill 2919, providing counties with the authority to regulate short-term vacation rentals through zoning laws, including the option to prohibit them. This measure is intended to address the state's housing shortage by converting a substantial number of these rentals into long-term, affordable housing options for residents. Gov. Green estimates that 75,000 of the 89,000 short-term rentals in Hawaii are unpermitted, contributing to a housing crisis that sees 25% of residents struggling with housing costs.

The law is part of a broader strategy to ensure that within two to three years, Hawaii could have an excess of affordable homes if counties convert approximately 75% of the illegal units. The move also comes in the wake of a Maui wildfire that highlighted the urgency of housing local families. Maui County Mayor Richard Bissen has announced intentions to phase out around 7,000 vacation rentals in apartment districts, which includes 2,200 in West Maui.

Local leaders, including Honolulu Mayor Rick Blangiardi, have expressed support for the legislation, highlighting its potential to assist in housing local and Native Hawaiian communities. The American Hotel and Lodging Association has also praised the law, emphasizing its importance for ensuring affordable housing for essential workers, including hotel employees. Meanwhile, Governor Green has assured that properties participating in the Rental Assistance Program (RAP) and Direct Lease programs with the state and FEMA will not be affected by the new regulations, thus continuing support for families in need.