Column: Hawaii Tourism Authority distorts value of vacation rentals
The full story here is that vacation rentals have become a pillar of our city and state tourism economy because they allow budget-conscious visitors affordable lodging options.
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After months of deliberation, the Honolulu City Council will vote Monday on two bills that would effectively outlaw our community’s longstanding vacation rental ecosystem.
As Council members and Oahu residents discuss what smart regulation of this economic powerhouse should look like, fair and properly-contextualized data should be a welcome addition to this important conversation.
Unfortunately, new data from the Hawaii Tourism Authority (HTA) spotlighted in a recent Star-Advertiser article, makes no such contribution (“Vacation rental guests contributing less to Hawaii tourism economy,” June 10). In fact, it adds even more misinformation to the discussion. At a minimum, the HTA data must be taken with a very large grain of salt because it fails to account for the myriad of contributions vacation rental stakeholders make to our local economy. But more so, the HTA report misses the forest for the trees by failing to recognize important realities of the modern tourism economy.
As the headline indicates, the publicized data suggests that vacation rental guests contribute less to the local economy than hotel guests. However, this suggestion collapses under scrutiny of the data and its underlying assumptions.
While money spent by travelers at hotels goes off-island into the coffers of the multinational corporations that own them, money spent by vacation rental guests stays in our local communities and supports the local economy. Hotels force travelers to pay exorbitant resort fees and push them to stay on the property to indulge in expensive restaurants, bars, spas, and gift shops. By contrast, vacation rentals encourage families to patronize local small businesses, mom-and-pop restaurants, grocery stores, galleries and tour companies. Not to mention the rate paid by vacation rental guests goes to local homeowners and hosts, rather than a major corporation in suburban Maryland and Virginia.
So, even if we take the HTA’s data at face value, it is misguided to simply equate a higher room rate with more economic benefit. It’s just not that simple. Vacation rentals are spreading economic benefits across the island, rather than concentrating them on the hotel property and in the pockets of major hotel chains.
And when it comes to supporting local jobs, let’s be honest — there seems to be a new story every week about hotels fighting minimum wage increases. Vacation rentals, on the other hand, support local cleaning, home repair and landscaping services, which pay well above the minimum wage.
As the Star-Advertiser article noted, a 2018 study concluded “without alternative accommodations outside of resort zoning, Oahu would stand to lose the following on an annual basis: $336 million in household income, 7,000 jobs and $1.2 billion in economic activity.”
The full story here is that vacation rentals have become a pillar of our city and state tourism economy because they allow budget-conscious visitors affordable lodging options. As the article pointed out, the proliferation of vacation rentals in recent years is akin to the arrival of jet travel in 1959: both lowered travel costs, making Hawaii more accessible to people of diverse economic backgrounds. Without these options, families may well choose to travel elsewhere or forgo their travel altogether.
Understating, discounting and ignoring the economic impact of vacation rentals do a tremendous disservice to the public discourse surrounding this critical local issue. Thinly veiled bans and unwarranted 30-day minimums are dangerous impediments to fair compromise. It would be a tragedy if policymakers were to make decisions, even partly, based on incomplete and non-contextual information like the HTA’s data.
Scott Brazwell, of Kailua, is a retired vice president of operations; he occasionally hosts vacation renters in his home.