Hawaii's Bill 108 Becomes Ordinance 18-114 Short Term Vacation Rentals

Real Estate Agent with Kona Home Team (luva llc) RS 62947

Aloha, Lance Owens (RS) LUVA Real Estate here, bringing you the latest real estate news.      Hawaii's controversial Bill 108 (draft 7) has now been made into “Ordinance 18-114” (see below) putting heavy regulation on Short Term Vacation Rentals in Hawaii, specifically Hawaii Island.
 West Hawaii Association of Realtors (WHAR) put a tremendous amount of effort into trying to protect homeowners’ rights as the county moved forward with this “less than perfect” new Bill 108.  
It was important to us ALL that homeowner rights were being protected….. we had some partial success on this.
Quick note,  as a Realtor, I am neither “pro nor con” on vacation rentals, what I am “pro” on, is your right to the best and highest use of your property, along with your right to quiet enjoyment.
In short, some subdivisions and condo complexes were created solely with the intention that they would allow STVR to offset “ownership cost”. For instance, Keauhou Estates allows STVR, where Bayview Estates (across the street) does not. In many cases homeowners chose one over other for that specific reason, a huge value to both sides is the fact that they do, or do not, allow these – just depends on which side of the gate you are on! Same with condo complexes.

So what we were successful in was having condos with “RM” zoning included in the “allowed” STVR, so no special permits are needed as long as your AOAO allows these (don’t worry, if your HOA/AOAO rules banned them, they will still ban them)

Where we were not successful, was trying to get “subdivisions” that have always allowed them, legally and had them recorded in their CC&Rs to continue. The County would not budge on this one. I fear this may create lawsuits when the rules take effect, which will pretty much bring sales to a halt, driving values down tremendously – basically banks don’t lend to buyers if the HOA is any type of lawsuits, making a “cash is king” the only buyer. This will further hurt local buyers, and create a void the mainland “cash” investors may come in and scoop up.

It protects these subdivisions and condo complexes that have always banned STVR. (ie: Pualani Estates, Pines, Lokahi Makai, KVE…. And many more)
It may add a few homes that were operated illegally in these areas as STVR, to the long-term rental market which is needed

 it takes away significant $value$  to a property that was purchased legally with the intent to STVR
It also takes away homeowners rights – we never like to see anybody’s rights taken away.

Tax revenue – I say TBD because the online Air B&B websites had offered years ago to collect these taxes for the State, and the State turned them down, so for the County  to claim this as a tax victory – I call BS.
Long term rental availability…. Personally, I feel this was the motive behind the entire bill, we have no affordable rentals available here in Kona and I fully support ways for our County to figure this out. What I don’t think they thought about……. Is the fact that most of STVR are owned by snowbirds that come in for a month or two in the winter,  and doing a long term rental when they are not here would never work.
Time will tell, please feel free to read this bill/ordinance

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Aloha, and have a great day 

Lance Owens (RS)

(808) 936-8383



LUVA Real Estate 

75-240 Nani Kailua Dr #8 , Kailua Kona, HI. 96740 (Pines Plaza

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