Maui’s Vacation Rental Crackdown: What You Need to Know

Maui, one of Hawaii’s most famous islands is known for its beaches, luxury resorts, and vacation rentals. Now, local officials are pushing to ban 7,000+ short-term rentals (STRs) in certain areas, arguing that the island needs more long-term housing.

For vacation rental managers, this is a case study of how fast regulations can change—and why staying informed and adaptable is critical.

1. Where Is Maui and Why Does This Matter?

🌎Maui is a top global travel destination, attracting over 3 million visitors a year with its white-sand beaches, world-class surfing, and luxury accommodations.

Many visitors stay in vacation rentals, not hotels. STRs make up a huge part of the island’s economy.

The government wants to phase out thousands of these rentals, claiming it will create more housing for local residents.

2. What’s Happening?

Maui’s mayor Richard Bissen has proposed a law to eliminate short-term rentals (STRs) in certain condo buildings, forcing them into long-term housing.

Proposed timeline:

July 1, 2025, → STR ban starts in West Maui (home to Lahaina, Kaanapali, and Kapalua)
January 1, 202,6 → Ban expands to the rest of Maui County

However a key economic study to justify the ban has failed to attract bidders, leaving officials without data to support their decision (Hawaii Travel News, Feb 19, 2025).

3. What’s Actually Banned?

Still Allowed: Hotels, resorts, and some condo complexes with STR permits

At Risk: 7,000+ condos on the “Minatoya List”, which have legally operated as STRs for decades.

4. What Is the Minatoya List?

• Not all vacation rentals are banned—just certain condos.
• The Minatoya List includes condos in apartment-zoned areas that have legally operated as STRs since the 1990s.
• Named after David Minatoya, a former county attorney who ruled that these rentals were allowed.
• These properties pay 42% of Maui’s property taxes (Hawaii Free Press) and are a major part of the island’s tourism economy.

Now, the mayor’s plan would force them to switch to long-term rentals or sit vacant.

5. Why Is This Controversial?

Housing crisis vs. economic impact

• Officials say the ban will free up housing, but critics argue that these condos aren’t practical for long-term residents (high HOA fees, small size, vacation-focused locations).

Maui relies on STR revenue

• The Travel Technology Association warns that the ban could lead to:
  • $1.3 billion in lost revenue
  • 7,800 job losses
  • $370 million in lost earnings for local businesses

Legal battles ahead

• Attorney Greg Kugle, an STR law expert, says that if the bill passes, litigation is “100% guaranteed.”

6. What This Means for Vacation Rental Managers

A global warning – Other tourist destinations may follow Maui’s lead. Watch for similar policies elsewhere.

Market risks & opportunities – Uncertainty is lowering STR property values in Maui. Investors could find deals—but at high risk.

Engage locally – STR bans often stem from housing and community concerns. Proactive engagement can help prevent restrictions.

7. What’s Next?

• June 2025 → Maui Planning Commission review + public testimony
• Council vote expected later in 2025
• Legal battles could delay or block the ban for years
• Alternative solutions (higher STR taxes, new housing incentives) may emerge

According to Hawaii Life Realtor Tom Tac, many industry insiders believe most Minatoya List condos will ultimately be safe—but the uncertainty is already impacting the market.