What Maui’s Changing Short-Term Rental Laws Mean for Condo Buyers and Sellers

Few real estate topics on Maui generate as much discussion—and misunderstanding—as the evolving legislative landscape surrounding short-term vacation rentals (STRs). With Maui County Ordinance No. 5909 (famously known as Bill 9) setting phase-out deadlines for apartment-zoned vacation rentals on the historic "Minatoya List"—and the subsequent passage of Bill 88 creating new hotel zoning categories—condo buyers, sellers, and investors are navigating a rapidly shifting market.

Whether you are looking to acquire a beachfront property, purchase a primary residence, or re-evaluate an existing investment portfolio, separating sensational headlines from market reality is essential to making smart, confident moves.

Understanding Bill 9, Bill 88, and the Minatoya List

For decades, roughly 7,000 apartment-zoned (A-1 and A-2) condominium units across Maui operated as transient vacation rentals under a 2001 legal determination known as the Minatoya Opinion. To increase long-term housing availability for local residents, Maui County enacted Ordinance 5909 (Bill 9) to phase out short-term rental operations in these apartment-zoned complexes:

• West Maui Phase-Out Deadline: December 31, 2028 (effective January 1, 2029).
• South Maui & Rest of County Phase-Out Deadline: December 31, 2030 (effective January 1, 2031).

The Bill 88 Reprieve: New H-3 & H-4 Hotel Zoning Districts

To establish a legal pathway for qualifying historically operating vacation rentals, the Maui County Council passed Bill 88.

• What Bill 88 Does: It creates two brand-new hotel zoning classifications—H-3 (which mirrors A-1 Apartment standards) and H-4 (which mirrors A-2 Apartment standards)—specifically tailored to match the density and layout of qualifying Minatoya List complexes.
• What Bill 88 Does NOT Do: It does not automatically rezone any property, nor does it repeal Bill 9. Individual condo complexes must enter a formal review and approval process (via county resolutions or association applications) to be rezoned into an H-3 or H-4 district to legally preserve their short-term rental rights.
• Anti-Loophole Qualification Rule: To qualify for H-3 or H-4 hotel zoning, property records must verify that short-term/transient rental use actively occurred on the parcel prior to September 24, 2020. This prevents non-Minatoya residential properties from using the new zones as a backdoor.

The "First List" of Condos Moving Toward Transition

The County’s initial batch of specific apartment-zoned condos proposed to move into H-3/H-4 hotel zoning is embodied in Resolution 26-110 and Resolution 26-111.

Resolution 26-110 focuses on properties with timeshares, leaseholds, micro-complexes, or special characteristics, while Resolution 26-111 targets properties that already operate with hotel-like amenities (e.g., front desk, on-site staff).

Examples of Projects Advanced for Potential Hotel Rezoning

From these resolutions, key condo projects advanced for potential H-3/H-4 hotel zoning include:

• Mā‘alaea: Hono Kai, Lauloa Maalaea, Maalaea Kai, Milowai-Ma‘alaea, Kanaʻi a Nalu.
• Kīhei: Maui Hill, Maui Sunset, plus several parcels along Uluniu Rd, Iliili Rd, and Halama St. (Note: Properties such as Kamaole Sands and Luana Kai were also added in committee updates).
• West Maui: Kahana Outrigger, Kuleana, Kahana Village, Hale Mahina Beach Resort, Paki Maui, Maui Sands, Ka‘anapali Royal.
• Wailea / Resort Areas: Wailea Ekahi (I–III), Wailea Ekolu, The Palms at Wailea, Papakea, Maui Eldorado.

How the Policy Shift Is Driving Market Dynamics

The interplay between Bill 9's phase-out dates and the Bill 88/Resolution 26-110 & 26-111 rezoning pathway has divided Maui’s condominium market into three key tiers:

1. Tier 1: Existing Hotel/Resort Zoned Condos (H-M, H-1, H-2): Fully protected and completely unaffected by Bill 9 or Bill 88. Demand and capital retention remain highest here among investors seeking zero regulatory exposure.
2. Tier 2: Minatoya Condos in Active Rezoning Resolutions: Complexes included in Resolutions 26-110 and 26-111 undergoing Planning Commission and Council review. Successful rezoning allows these buildings to maintain STR status past the 2028/2030 deadlines.
3. Tier 3: Minatoya Condos Transitioning to Residential Use: Complexes that do not seek or qualify for H-3/H-4 rezoning will transition to 30-day+ long-term rentals or owner-occupancy after their phase-out date. Inventory expansion in these buildings offers excellent entry prices for buyers seeking primary homes, second homes, or long-term rental investments.

Moving with Clarity in Today’s Market

Navigating Maui’s real estate market requires moving past sensational headlines and looking at raw market data and zoning status. Moving with clarity means treating this market transition as a series of strategic options rather than a crisis.

1. Verify Property Zoning & Resolution Status First

Never rely solely on past rental histories or active Airbnb/VRBO listings.

• Check the TMK: Confirm whether the property is legacy Hotel Zoned (H-M, H-1, H-2) or Apartment Zoned (A-1, A-2).
• Evaluate Resolution Status: For apartment-zoned complexes, check if the building is named in Resolution 26-110 or 26-111, or if the AOAO board is preparing for future council waves.

2. Capitalize on Expanded Buyer Leverage

Increased inventory across apartment-zoned developments gives buyers more selection and room to negotiate than they have had in years. Sellers in complexes not pursuing rezoning are pricing competitively. For buyers operating with a Pivot Plan—such as capturing short-term rental cash flow through the phase-out deadline before transitioning to a long-term rental or personal residence—these price compressions represent rare value.

3. Identify High-Probability H-3 / H-4 Candidates

For buyers seeking vacation rentals at a lower price point than legacy hotel zones, target Minatoya complexes that meet all Bill 88 criteria (documented STR use prior to Sept 24, 2020, inclusion in active resolutions, and location in established tourist corridors).

4. Leverage Local Expertise & Data

Real estate success during policy shifts comes down to execution. Working with an experienced agent who actively tracks County Council rezoning hearings, Planning Commission reviews, AOAO board minutes, tax map keys, and local lending standards ensures you make moves based on verified policy rather than rumors.

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