Vacation Rental Conundrum: Money drives competition for limited housing on Oahu

A group of BYU-Hawaii students and staff are working with the North Shore community to raise awareness about the illegal use of residential properties as vacation rental houses.

Rebekah Matagi Walker, of the BYUH International Cultural Studies Department, is especially active in the movement and explained, “At first glance, it’s a way for people to make their mortgage. What’s happening is it takes away residential space and turns it in to commerce space. It drives up prices of homes within our community because outside investors are willing to pay top dollar for what they see as a profitable investment.”

Her husband, history professor Isaiah Walker, continued, “Homeowners often think that if they pay taxes on their vacation rental, then it is legal. However, there are technically only six legal vacation rentals in the Laie area; so if your home is not one of the six permitted Laie properties, then it is illegal and subject to thousands of dollars in fines. Since violations have drastically increased over the last few years, the City and County is no longer turning a blind eye to this massive problem.”

In November of 2015, Kent Fonoimoana, from Sunset, shared a story in the Ko’olauloa Neighborhood Board meeting about how vacation rentals negatively affected the street where a friend of his lived. In the gathering, Fonoimoana said how over time, the homes on his friend’s street gradually became empty. He said there were no more children playing on the road and his friend never saw his neighbors anymore. He finally realized all the houses on his street had slowly been converted into vacation rental properties.

Sam Wasson, a junior education major from Hauula, added, “You can see there are streets all over the place that used to be full of families, community people, working people. Now it’s just vacation rentals; tourists who come and go.”

The 2015 Hawaii Tourism Authority report cited a total of 4,411 vacation units being advertised online throughout Oahu, even though city data indicates the island had only 828 permitted vacation rentals as of November 2015. The report also revealed nearly 11 percent of the homes in Laie are used as vacation, while more than 20 percent of all available properties in Kahuku suffer the same fate.

Levi May, a senior ICS major from Wyoming who is part of the initiative, explained there are zoning laws in Hawaii that “say if you’re going to rent an apartment or house, it has to be for a full month. It’s against the law to rent anything [not zoned for vacation rentals] for two weeks or less. That law is to protect people looking for housing and helps make housing more available to them.”

May continued, “If all the available houses are being used for vacation rentals, there aren’t any places left to rent for [locals]. This makes the prices go up for what is available and especially affects people who are low income and can’t find a good place to live for a fair price.”

The town of Kailua,on the far eastern side of Oahu, has been facing the same problem for just as long as the North Shore, but citizens have begun to take action and strike down the vacation rental conundrum plaguing its neighborhoods. Walker said there are community members in Kailua like herself and May who have spoken out to raise awareness of the growing issue. They are actively encouraging their fellow citizens to stop using their properties for vacation rentals and report any cases they know of to authorities for investigation.

Wasson is also actively trying to spread the word on the issue, but he wants others to understand most of the people using their properties as vacation rentals are not bad people. “They could be using their money to help put their kids through college or any other good cause, but they don’t realize they’re hurting their fellow community members and actually doing something illegal.”

BYUH has recently addressed the growing rental dilemma through a series of e-mails and meetings to inform staff members about the issue, according to BYUH University Communications Director Michael Johanson. “It is very important that we understand the laws, especially those that are changing, when they impact us. The Housing Office is making a concentrated effort to educate those who are affected by these changing laws. That education will continue to be refined as more information is available as it relates to university employees,” Johanson wrote in an e-mail to BYUH faculty and staff.

Walker said one of the biggest obstacles the community will face trying to stop the pervasive vacation rentals is money. “In order to clear out these businesses, people are going to lose money and that scares them,” she said. “A lot of people buy homes knowing they can only afford it if they also use it for vacation rentals. If they no longer do the rentals, they can’t afford the home anymore.”

Honolulu’s Department of Planning and Permitting told the investigative news site Civil Beat that it is looking to enact more aggressive measures to combat illegal rentals. This includes increasing the fines for short-term rentals from $1,000 to a maximum of $10,000 a day.

The department is also considering introducing a bill in the City Council that would require vacation rental operators to include information on their advertisements indicating that their rentals are legal, such as their operating certificate number or address, or face a penalty of $1,000 a day.

Date Published: 
Saturday, June 4, 2016
Last Edited: 
Saturday, June 4, 2016