Short-Term Vacation Rentals in Hawaii: What You Need to Know (Part 1)
By Dan Polimino, The Hawaii Team at Keller Williams Realty, Big Island
Today, we’re kicking off a three-part series on short-term vacation rentals. This is a huge topic. Nearly every buyer who calls us at The Hawaii Team asks about short-term vacation rentals—specifically, whether they can rent out a property they purchase. Because the topic is so extensive, we’re breaking it into three parts:
- Part One (this post): What qualifies as a short-term vacation rental?
- Part Two: Who manages your short-term rental, and how do you choose the right company?
- Part Three: The numbers—what kind of return on investment can you expect?
Let’s dive into Part One.
We often get emails from buyers that include links to properties they’ve found on Zillow, Redfin, or other sites. They’ll say, “Dan, we’re interested in these.” And honestly, nine out of ten of the properties they send won’t qualify for short-term vacation rental use.
Here’s why.
Five years ago, it was much easier. You could go on Airbnb or VRBO and rent out a house or condo pretty much anywhere. There weren’t many rules or restrictions. But that’s changed dramatically.
Around 2017–2018, HOA boards began cracking down. They didn’t want transient visitors disrupting communities where people lived full time. As a result, many HOAs started requiring minimum rental periods of 30 days. That’s the key number—anything less than 30 days is considered a short-term vacation rental.
So today, in many communities, rentals of fewer than 30 days are simply not allowed.
Then, in 2019, the State of Hawaii stepped in to regulate short-term vacation rentals more broadly. The main concern was unpermitted rentals—properties being rented without proper approvals or tax payments. The state responded by establishing designated vacation zones. These are specific areas where short-term vacation rentals are potentially allowed.
But here’s the catch: Just because a property is in a vacation zone doesn’t mean you’re automatically approved. You still have to check with the HOA to see if they permit short-term rentals. In reality, about 80% of the properties buyers think they can turn into vacation rentals either aren’t in a vacation zone or are restricted by their HOA.
So how do you know if a property qualifies? Well… you don’t. At least not easily.
That’s where we come in. The Hawaii Team have done the homework. We’ve talked to HOAs. We’ve talked to property owners. We know the ins and outs—where short-term vacation rentals are allowed and where they’re not. So save yourself the time, effort, and frustration of searching online and driving through neighborhoods.
Call us first. Tell us your goals, your wants and needs, and what you hope to achieve with your investment. We’ll guide you toward properties that actually fit the criteria.
At any given time, we’re helping 10 to 15 buyers each month look for short-term rental properties. They’re in high demand and go quickly. So you’ve got to be ready to act fast—and you’ve got to work with people who understand the process.
In Part Two of this series, we’ll talk about property management—who to hire, what to look for, and how to align management services with your goals. Not all property managers are created equal, and it’s important to find the right fit.
In the meantime, if you’re looking to buy, sell, or invest in real estate on the Big Island, contact us at The Hawaii Team. You can reach us at 808-913-0899 or visit thehawaiiteam.com.
Aloha!
