Interesting article about Maui shutting down short term rentals (STRs)

[andre10056]

Vague Laws, Big Consequences: Uncertainty Chokes Maui Vacation Rentals

Maui’s vacation rental crackdown plan has left travelers and owners scrambling for answers. With shifting regulations, legal uncertainty, and growing confusion over what’s actually changing, Hawaii visitors are left wondering whether their bookings are secure. Here’s what’s happening, what’s at...

beatofhawaii.com

I'm sure Hawaiian timeshare owners are already very much familiar with this, but I find it fascinating what's apparently going on now.

Native Hawaiians are apparently livid with anger that they have no housing since so many Hawaiian properties have been converted into short term rental vacation properties for tourists. Hence, the municipal governments are going to shut down many thousands of such STRs.

Seems like that might make Hawaiian timeshares more valuable, both in terms of sales value as well as rents that might be sought.

 

[Luanne]

Vague Laws, Big Consequences: Uncertainty Chokes Maui Vacation Rentals

Maui’s vacation rental crackdown plan has left travelers and owners scrambling for answers. With shifting regulations, legal uncertainty, and growing confusion over what’s actually changing, Hawaii visitors are left wondering whether their bookings are secure. Here’s what’s happening, what’s at...

beatofhawaii.com

I'm sure Hawaiian timeshare owners are already very much familiar with this, but I find it fascinating what's apparently going on now.

Native Hawaiians are apparently livid with anger that they have no housing since so many Hawaiian properties have been converted into short term rental vacation properties for tourists. Hence, the municipal governments are going to shut down many thousands of such STRs.

Seems like that might make Hawaiian timeshares more valuable, both in terms of sales value as well as rents that might be sought.

Depending on how the timeshares are classified it might make them worth nothing. Check out the Minatoya list which shows the classification of properties. The A1 & A2 are designated Apartment and I believe those are the ones that might be in danger.

Alphabetical Minatoya List — Romvari Realty

The Minatoya List was created in 2001 by Richard Minatoya, the Deputy Corporation Counsel for Maui County, to clarify where vacation rentals (TVRs) could legally operate on Maui. The rule, which was later adopted into the Maui County Code, states that con

www.romvarirealty.com

From what I hear from folks who live on Maui this will be tied up in the courts for years.

 

[DeniseM]

This does not apply to hotels and timeshares which are licensed as short term rentals. This applies to fully-owned condos & homes.

 

[Luanne]

This does not apply to hotels and timeshares which are licensed as short term rentals. This applies to fully-owned condos & homes.

Some timeshares are classified as Apartments, on the Minatoya list, like where we own at Maui Hill.

It's all such a mess that I don't think anyone really knows which properties might be targeted.

 

[DeniseM]

Interesting - but I'm guessing that is not the norm.

 

[easyrider]

Seems like that might make Hawaiian timeshares more valuable, both in terms of sales value as well as rents that might be sought.

It hasn't really gone that route. I see Hawaiian timeshares selling for very little, especially in West Maui. The fire coupled with the economy and high prices of going to Hawaii in general might be the main reasons.

I wouldn't buy any deeded Hawaiian timeshare for many reasons but do have memberships in timeshare systems that include many resorts in Hawaii. Special assessments are one of the reasons.

Bill

 

[easyrider]

It's all such a mess that I don't think anyone really knows which properties might be targeted.

It seems like they all have some sort of target on them. Everyone wants a piece of the action and others want them completely eliminated. The way things are going, as the ocean erodes the beaches, there will be nothing the resorts can do to save the resort ,and it will be condemned. Then shoreline rules might prevent new construction.

Bill

 

[DeniseM]

I don't think we will see any impact on the value of Hawaii timeshares unless the short-term rental laws/regulations are actually changed, and it might be a long time, before that happens, if at all.

 

[klpca]

Some timeshares are classified as Apartments, on the Minatoya list, like where we own at Maui Hill.

It's all such a mess that I don't think anyone really knows which properties might be targeted.

Is you HOA sending any information about this to the owners? Does this mean that you will not be able to occupy your owned intervals? Are they saying that the resort will convert to apartments?

 

[Luanne]

Is you HOA sending any information about this to the owners? Does this mean that you will not be able to occupy your owned intervals? Are they saying that the resort will convert to apartments?

Our HOA has said nothing. They may be waiting until there is something definite to report.

 

[TEK224]

I'm a bit confused by this statement
"Native Hawaiians are apparently livid with anger that they have no housing since so many Hawaiian properties have been converted into short term rental vacation properties for tourists"

Do the locals want these properties for long term rental, but are not able to because of the STR for tourists? Are these STR owned by corporations or individuals?
I understand the concern for locals who need permanent housing, due to the fires, but if they don't own the property how is that impacting them? And if they are encouraging tourists to come to Maui, to help boost the economy, why is it an issue for people to rent their properties to tourists?

I've seen some Youtube videos of houses that are being rebuilt, but I'm sure it's a slow process, what with going thru FEMA or the Hawaiian government or banks for funding.

I'm sure I'm missing something, to help me understand the issue, so if anyone can provide insight so I can be more informed, I'd appreciate it.

 

[4TimeAway]

I see Hawaiian timeshares selling for very little,

From what I can tell Japan has the demographic cliff and a recession. Most of the resales are from Japan.

 

[RENTER]

This does not apply to hotels and timeshares which are licensed as short term rentals. This applies to fully-owned condos & homes.

You may and probably are correct but many times the timeshare owners are caught in a catch 22 especially if they rent it out thru the online rental sites. Many times these laws are passed as one size fits all rules and make no exemptions for timeshare owners.

Also the online rental sites make no exceptions for timeshares, so they ban them from being posted for rent or until they owner applies for a permit and receives permission from the local government.

That turns into another difficult story because to apply for the permit, you need info that you would need if you own the property privately. Claiming being a timeshare only works for the resort and not individual owners because of the information needed.

Then trying to explain this to the bureaucrats of the government and the online rental site is like banging your head against the wall.

Should not be a problem if you rent privately or on a site the government is not targeting.

 

[ScoopKona]

I'm a bit confused

Do the locals want these properties for long term rental, but are not able to because of the STR for tourists? Are these STR owned by corporations or individuals?
I understand the concern for locals who need permanent housing, due to the fires, but if they don't own the property how is that impacting them? And if they are encouraging tourists to come to Maui, to help boost the economy, why is it an issue for people to rent their properties to tourists?

Maui has always been tip of the spear in the effort to decrease visitor numbers.

The idea that some schlub disembarking from a cruise ship is "boosting the economy" is ridiculous. Hawaiians don't see a penny of cruises, airfare, accommodations, rental cars, grocery purchases and waterfront tourist trap restaurants (unless they work at these places -- and these are the worst jobs on the island). Nearly all that money leaves the island immediately, not helping anyone. Tourism enriches the people who already own everything, Costco, the Walton family and similar.

Their goal has always been to have fewer visitors. They've tried all sorts of schemes -- none really getting anywhere. Back during the golden age of jet travel, visitor numbers were self-limiting. The cost of a round-trip ticket from the West Coast on a DC-8, adjusted for inflation, was $4,000. That was all the tourism the island needed. And hospitality was considered a great career back then. They've been introducing bills to reduce tourism numbers for decades now.

STVRs are the final straw. Nearly every house in my area is being purchased by foreign investors, cash offers of more than list price. Residents can't compete with investors -- who then turn their purchases into little mini real-estate empires.

I'm rooting for Maui to find the "secret sauce" which balances economic necessity and quality of life. If they do, every island will follow suit. The pendulum has swung entirely too far in the direction of "theme park."

 

[easyrider]

Most of the resales are from Japan.

Which Island ? I remember Oahu was very popular for Japanese tourists in the past.

Bill

 

[sponger76]

Which Island ? I remember Oahu was very popular for Japanese tourists in the past.

Bill

That's been my experience as well. Growing up on O'ahu, it seemed like Japanese visitors were everywhere and outnumbered other tourists. But on our fairly regular visits to other islands they were a lot less prominent compared to tourists from the mainland. While I still make it back to O'ahu multiple times a year, it has been at least 8 years since I've visited any of the Outer Islands. Maybe Japanese tourism has increased out there, but I have no clue. I'll be on Maui next month, so maybe I'll find out.

 

[ScoopKona]

Maybe Japanese tourism has increased out there

It has not. With the yen in the toilet, Japan is currently the best vacation value on the planet. And it's ridiculously expensive for them to visit anywhere in the developed world, or the United States.

 

[sponger76]

It has not. With the yen in the toilet, Japan is currently the best vacation value on the planet. And it's ridiculously expensive for them to visit anywhere in the developed world, or the United States.

I was speaking more in comparison to when I was growing up, not just the last couple of years. But definitely in the more recent term the exchange rate isa deterrent to the Japanese leisure market.

 

[ScoopKona]

I was speaking more in comparison to when I was growing up, not just the last couple of years. But definitely in the more recent term the exchange rate isa deterrent to the Japanese leisure market.

I still see them occasionally at the abalone farm. And in local grocery stores.

But my S.W.A.G. is that visitor numbers here are down 70% compared to the pandemic. It's not nearly as bad on O'ahu -- more like half there. It's a shame, because Japanese tourists are much, much better at the nuts-and-bolts of tourism. They aren't stopped in the middle of the road, taking selfies, or picking up sea turtles and flinging them into the ocean.

 

[TEK224]

Maui has always been tip of the spear in the effort to decrease visitor numbers.

The idea that some schlub disembarking from a cruise ship is "boosting the economy" is ridiculous. Hawaiians don't see a penny of cruises, airfare, accommodations, rental cars, grocery purchases and waterfront tourist trap restaurants (unless they work at these places -- and these are the worst jobs on the island). Nearly all that money leaves the island immediately, not helping anyone. Tourism enriches the people who already own everything, Costco, the Walton family and similar.

Their goal has always been to have fewer visitors. They've tried all sorts of schemes -- none really getting anywhere. Back during the golden age of jet travel, visitor numbers were self-limiting. The cost of a round-trip ticket from the West Coast on a DC-8, adjusted for inflation, was $4,000. That was all the tourism the island needed. And hospitality was considered a great career back then. They've been introducing bills to reduce tourism numbers for decades now.

STVRs are the final straw. Nearly every house in my area is being purchased by foreign investors, cash offers of more than list price. Residents can't compete with investors -- who then turn their purchases into little mini real-estate empires.

I'm rooting for Maui to find the "secret sauce" which balances economic necessity and quality of life. If they do, every island will follow suit. The pendulum has swung entirely too far in the direction of "theme park."

Thanks for the explanation Scoop

 

[jp10558]

I never really understood Japanese wanting to go to Hawaii. We get the benefit of it being still in the US so we don't need to deal with customs / passport like going to much of the Caribbean say. But Japan has Okinawa as well as plenty of other island or beach locations much closer that have to be cheaper than Hawaii, not to mention cheaper to get to right?

I live somewhere that doesn't really get tourists, but is basically a college town and many locals hate the students and always want to fight the university on anything. But there's very little else "good job" wise in the area. I don't know if the locals really understand what the students going away permanently would mean - most shopping, services and jobs would disappear. I imagine a lot of the tourist areas might have the same problem - there's usually not much "other jobs" around.

 

[WaikikiFirst]

I never really understood Japanese wanting to go to Hawaii.

I never really understood Americans wanting to go to London. Or maybe they're on reconnaissance for PH2.0? It is neither complicated enough nor simple enough to bother to "not understand" it. And, please, all Japanese are not alike. There is not 1 reason

 

[ScoopKona]

I never really understood Japanese wanting to go to Hawaii.

Mostly they're coming for the food and shopping. (So they tend to fixate on O'ahu or Big Island.)

Unlike mainland tourists, the Japanese are passionate about Hawaiian fish and produce. They aren't eating at Howlin' Howlie's on the Waterfront. They aren't shopping at Costco and Walmart. I'll bet a nickle that Japanese tourists outnumber mainland tourists over at the abalone farm right now. What is unaffordable at home (abalone, watermelon) is cheap and plentiful here. They're also chowing down on ahi tuna. And they're eating at KFC, which is a thing in Japan. I've never gone to KFC here and not seen a Japanese family. (Too bad I can't tell them about Minit Stop, which sells better chicken for less.)

As for shopping, they can pop over to Luxury Row in as little as nine hours from their front door. Back when the yen was strong, this was their best value for Vuitton handbags and similar.

You can always tell when it's a Japanese visitor asking questions on Hawaii travel fora -- because they're not asking about what's cheapest. They want to know what's best.

 

[WaikikiFirst]

Mostly they're coming for the food and shopping

Big part of it. I had to laugh recently when the Defenders Of Cabo were trying to say the food in Cabo was better than in HNL. But then they started talking about eating in sports-bars, so there you go.
Shopping depends greatly on the FX rate, so ... tbd yr-to-yr. But yes, "Back when the yen was strong" that was a huge part of it.

passionate about Hawaiian fish and produce

Me too. Maybe best thing about having a TS instead of a hotel is immediately going out to certain places to buy certain kinds of super-high-quality produce. I say "certain" because in some cases, the produce on Maui & Oahu make me ask "How? How can you not grow better than that in this place?" BUt if you know where to go...
Now, on produce, you know Japanese melons, the ones that at early 1990s FX rates could cost $50 or more each? I not long ago heard from a SHOCKED Japanese who visited HNL that now (in Yen) inferior melons in HNL cost more than the "great Japanese ones" ( said with PRIDE) do in Tokyo.

I'll bet a nickle that Japanese tourists outnumber mainland tourists over at the abalone farm right now.

I've never been there and I'd prob bet more than that, other than the fact that the gross #s are down.

 

[geist1223]

I vote for the entire State of Hawaii shutting down all STVRs. Require leases of at least 12 months. Tax these so Hawaii can employ Inspectors to make sure the 12 month term is being honored.

I believe many of the STVRs are owned by Business/Corporations or off-Islanders.