Hawaii Judge Allows Short-Term Rentals Up to 90 Days To Operate Legally

A district court judge in Hawaii ruled that existing short-term rentals outside resort zones can continue their operations and advertising of rentals for stays of 30 to 89 days.

Ordinance 22-7, which passed in October 2022, redefined “short-term” and made rentals from 30 to 89 days outside resort zones illegal and subject to fines, Courthouse News reported. The Hawaii Legal Short-Term Rental Alliance challenged the ordinance, claiming it violated property owners’ longstanding rights and would lead to financial losses.

30-Day Minimum

This permanent injunction means that those rentals that were grandfathered-in can operate under the 30-day minimum rule. The judge said the ordinance conflicted with state zoning laws and ruled that it cannot eliminate existing lawful residential uses within zoned areas. 

The new ruling, however, doesn’t apply to any short-term rentals that opened after the ordinance was put in place.

The City Council originally passed the ordinance to address the perceived adverse impact of short-term rentals, often owned by out-of-state landlords, on housing costs and local life. 

Short-Term Rental Conversions

Meanwhile, Hawaii Governor Josh Green urged homeowners to convert 3,000 short-term rental condos and homes into long-term housing for those displaced by the summer’s Lahaina wildfire. In December, Green mentioned the possibility of using post-emergency orders if the conversion isn’t voluntary by mid-January.

Over 6,000 residents are still in hotels due to housing shortages. The Federal Emergency Management Agency planned to offer rent subsidies to short-term rental operators who provide units for about 2,000 families. 

And in November, Maui Mayor Richard Bissen proposed tax incentives to encourage the transformation of short-term rentals into long-term housing, potentially saving property owners an estimated $17,775 each for the year 2024.