A proposal to phase out 7,000 short-term rentals on Maui already appears to be impacting the real estate market, as condo sales have declined by “double-digit percentages” since the mayor announced the plan. In March 2024, 93 condos were sold in Maui County; in July, that number dropped to 64, reports Brian Perry in Maui Now.

The bill would ban short-term rentals as an approved use in apartment districts, which would affect about half of the city’s STR offerings. In May, Governor Josh Green signed a bill giving Hawaii counties the authority to set their own regulations and zoning laws for short-term rentals.

“While it is too early to declare a long-term trend, the downturn could be an early sign of a cooling of Maui’s overheated real estate market, which has made purchasing homes and condos unaffordable for most long-time island residents.” However, condo prices fell only 1.3 percent year-over-year in three months, while single-family home prices rose 11.2 percent in three months.

According to Lynette Pendergast, president of the Realtors Association of Maui, the STR rules are just part of a bigger picture that includes interest rates and high real estate prices.

Maui Mayor Richard Bissen said, “These are desirable trends for local housing affordability, and we expect these trends to intensify as the County Council approves the phase-out and purchases of these units become more affordable for residents and long-term landlords.”