Study shows short-term rentals generated $2.2 billion in economic activity for Maui and $11.3 billion across Hawaii in 2023
June 13, 2024, in KAHULUI – Today, the Travel Technology Association and Hawaii economic consultant Kloninger & Sims released a study on the economic and fiscal impacts of the short-term rental market in Maui County and across the state.
According to the report, under Mayor Richard Bissen’s proposal to phase out approximately 7,000 short-term rentals on the Minatoya list, Maui County could lose up to $91.8 million in annual tax revenue and up to $280.9 million in total tax losses if all short-term rentals are discontinued in the county. If other counties followed suit and phased out short-term rentals, the State could lose as much as $554 million in annual tax revenue.
The study also underscores the significant economic activity short-term rentals contribute to Maui and Hawaii yearly. The analysis found that short-term rental guests in Maui County directly spent $2.2 billion in 2023, resulting in $4 billion in economic activity. Across Hawaii, short-term rentals generated $11.3 billion in economic activity in 2023 and 66,000 jobs.
Key Findings:
If all short-term rental units on the Minatoya List are phased out, Maui County could incur the following annual economic and fiscal losses:
- $53.3 to $91.8 million in real property (RPT), transient accommodations (TAT), and general excise tax (GET) to Maui County
- $1.3 billion in economic output
- 7,800 jobs
If all short-term rental units in Maui County are phased out, the following annual economic and fiscal losses could occur:
- $128.3 to $280.9 million in RPT, TAT and GET to Maui County
- $2.2 billion in economic output
- 23,000 jobs
If all short-term rental units throughout the state are phased out by the counties, the following annual economic and fiscal losses could occur:
- $803.3 to $955.9 million in taxes to the State and Counties, that includes:
- $554 million in State TAT and GET
- $121 million in all county GET and TAT surcharges
- $128.3 to $280.9 in Maui RPT
- $11.3 billion in economic output
- 66,000 jobs
“Roughly a third of all visitors to Hawaii use short-term rentals. On Maui, that ratio is even higher,” said Erik Kloninger, economist and partner of Kloninger & Sims. “Reducing the number of short-term rentals would limit accommodation options and likely lead to a decrease in visitors, resulting in job losses across various sectors of the economy and a significant shortfall in tax revenue for Maui County and the State.”
“Short-term vacation rentals have been a staple of the Maui economy for decades,” said Laura Chadwick, President and CEO of Travel Tech. “They’ve opened the island’s beauty to countless visitors and provided jobs and tax revenue to support the local community. We hope Maui and Hawaii leaders will consider other options to balance the economic benefits of short-term rentals and housing needs of the community.”
About Travel Tech
The Travel Technology Association (Travel Tech) empowers traveler choice by advocating for public policy that promotes marketplace transparency and competition. Travel Tech represents travel technology innovators ranging from dynamic startups, small, and midsize businesses to leading online travel agencies, metasearch engines, short-term rental platforms, global distribution systems, and travel management companies.
About Kloninger & Sims Consulting, LLC
Kloninger & Sims is led by principals Erik Kloninger and Mimi Sims. The firm focuses primarily on market and financial analyses for Hawaii’s hospitality and real estate industries. Kloninger & Sims has worked on various projects in the private, non-profit, and government sectors including projects for the Hawaii Tourism Authority (HTA), Hawaii State Department of Business Economic Development and Tourism (DBEDT), major hotel brands, ali‘i trusts, and many others.
