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Rental Laws: What You Need to Know

Changes in Vacation Rental Laws

There are plenty of people heading to Hawaii on vacation, and many of them would prefer renting a home rather than staying in a hotel. However, new regulations regarding Short Term Rentals (STR) may affect your ability to rent out your abode. If you are considering joining Airbnb or a similar organization,  whether or not you can rent out your property legally depends on where it is located.

New Legislation

In June, Honolulu Mayor Kirk Caldwell signed a bill imposing tough new restrictions on vacation rentals. Under the law, bed and breakfast rentals are limited to just 1,715 in all of Honolulu. However, if your home is located in a resort area, such as Waikiki or Turtle Bay, it is exempt from the new regulations.

Potential Penalties

It is no secret that there are lots of illegal rentals already in existence. Under the new law, visitors will not receive punishment if they book an illegal rental, but that’s not the case for the property owner. If an illegal rental is discovered, the property owner faces a $1,000 fine for the first offense, and up to $5,000 for second and subsequent violations.

Short-Term Rental Registration

Under the new law, property owners must register their short-term rental homes by September 28, 2019, and pay a $500 registration fee. If you already have an STR, your registration is grandfathered.

However, if your STR was registered prior to April 1, 2019, you must apply for an annual $250 Non-conforming Use certificate. Only homeowners may apply for STRs, not companies or legal entities.

New Stipulations

The legislation is the result of complaints by residents finding their neighborhoods changing because of so many STRs and the resultant problems. The new law includes various stipulations to protect the quality of life for residents. These include:

  • Quiet hours from 9 p.m. to 8 a.m. –All rental agreements must include this proviso, and the homeowner must post this notice in the dwelling.
  • Guests must park vehicles in designated parking areas onsite.
  • All STR ads must include either the registration or non-conforming use number.

Transient Vacation Units

Bed and breakfasts are considered those homes where the owner is present during the guests’ stay. Many homeowners are more interested in renting out their properties as Transient Vacation Units (TVU), and will not stay there when guests are present. Registration for TVUs by homeowners starts October 1, 2020, as the Honolulu Department of Planning and Permitting requires more time to put these new rules into operation. The initial registration fee for a TVU is $1,000, with the annual renewal set at $2,000. Illegally renting out a TVU can bring a fine as high as $10,000.

Other rules involving TVUs include providing neighbors within 250 feet of the home with a 24-hour number to contact the homeowner regarding complaints.

Contact Us

If you’re looking to buy or sell a home or find a rental property, you need a knowledgeable, experienced realtor familiar with all aspects of the Hawaiian real estate market. Contact Island Realty Group LLC at 808-689-7407 or IslandRealtyGroup@irghi.com.

Rental Laws: What You Need to Know