Hawaii lawmakers are considering legislation that could phase out short-term rentals in an effort to address the state’s severe housing crisis. Two bills, HB1838 and SB2919, have advanced through the legislature and would give counties the authority to regulate vacation rentals, including the power to phase them out over time.
The housing crisis in Hawaii has reached a critical juncture, with locals facing the highest housing costs in the nation and one of the worst rates of homelessness. Proponents of the short-term rental phase-out hope that this new sense of urgency could help push these bills into law in the coming weeks.
If passed, the bills would provide counties with the legal framework to limit short-term rentals in a variety of ways. However, it’s important to note that even if these bills pass, nothing would happen overnight. County officials would have to adopt new rules to limit rentals, which could take several years to implement.
State Rep. Luke Evslin, the chair of the House Committee on Housing, said that while these bills may not eliminate short-term rentals on the islands, they would give local governments the opportunity to define the neighborhoods where tourists could rent short-term units. He believes this could free up more homes for locals seeking long-term rentals.
The bills have garnered support from many local housing nonprofits, hotel companies, and local leaders, who argue that the short-term rental industry has created an imbalance in the housing market. However, there is also a broad swath of opponents, including local homeowners who rely on rental income, Realtor groups, rental alliances, and rental platforms.
Airbnb has expressed concerns about the financial losses that the state could see if the bills are passed, and has hired former Hawaii attorney general, David Louie, to argue against the measures, claiming that they could result in lawsuits challenging their constitutionality.
Months after the Maui wildfires, hundreds of displaced families are still living in hotels, and officials hope to relocate them to long-term housing by this summer. State Senator Jarrett Keohokalole wants to see the end of a system that has been displacing local people in favor of economic activity.
Hawaii Gov. Josh Green supports the two bills going through the legislature and believes that they would provide counties with more tools to address vacation rentals. The bills have been voted out of their respective chambers and are moving into conference committee, where another round of changes can be made before a final vote, which must occur before May 3, the end of the state’s legislative session.
If the measures pass, it would be up to county leaders to determine how and when to phase out short-term rentals. However, any phase-out would have to occur over a reasonable amount of time, likely years.
