In September, enforcement of New York City’s 2022 short-term rental rules began — and we can now see the results. Unfortunately for guests and hosts alike, only about 250 of 36,000 vacation rentals in the city were able to obtain a license before the rules took effect. Tens of thousands of families have lost the vacation rental income they depended on, but there are winners. The hotels are reaping windfall profits.
But did it work? Did it solve the affordable housing crisis? No. The data is in and it didn’t make the smallest dent in affordable housing. The city took away people’s livelihoods, and the only beneficiaries were corporate hotels.
Of course NYC’s market interference isn’t unique. Hawaii has favored the elite over everyday citizens for centuries. All the way back in 1848, the Great Mahele gave vast lands to the well-connected while the people were left with crumbs. Sugar and pineapple were the same. Plantations were given the land and the water, while locals were condemned to tenancy.
Even today restrictive zoning has concentrated commercial real estate in the hands of companies such as Alexander & Baldwin. The Jones Act forces all of us to pay Matson a fee on everything we buy.
We pay the Hawaiian Electric monopoly three times as much for electricity as residents of Iceland, a nation with similar geography.
Fortunately for New Yorkers, the new regulations won’t destroy their diverse economy. In Hawaii it’s a different story. Statewide we have only one major industry: tourism. Without tourism our economy comes to a halt, unemployment climbs, businesses shutter and our population’s outmigration to Las Vegas accelerates.
This was true during COVID, and the Maui catastrophe is proving it again. Tourism powers our state. If locals cannot participate in tourism they cannot prosper.
Our politicians know this, but they continue to pass bills that benefit monied interests at the expense of local families. Ironically, the companies that benefit aren’t even located in Hawaii.
Nearly all of the airlines, rental car companies and major hotels are headquartered on the mainland. Locals pay the price of over-tourism in the form of clogged roads, crowded beaches and high prices, while corporations export the profits. Like the plantation workers of the past, locals are relegated to the role of tenant workers. Our political leaders have made us all the victims of Colonial Tourism.
And they are working to keep it that way — most recently by attacking families that make ends meet by operating a vacation rental. Contrary to the narrative being put forward by the corporate hotels, most vacation rental owners (72%) are local families like mine. A majority are Hawaii residents. Most over age 50. A vast majority own one property.
We are not greedy out-of-state investors buying up everything in sight. We are local families who contribute significantly to our communities. Our visitors spend $4.8 billion in Hawaii each year. We employ 49,000 workers and pay more than $740 million in taxes. And we treat our workers well because they are our ohana. Our workers have flexible hours and earn an average hourly wage of more than $40 per hour. Vacation rental owners have figured out how to carve out a piece of the tourism pie and keep more than mere crumbs here in Hawaii.
But our politicians seem hell-bent on putting us out of business. To benefit whom? Hotels that send their profits to the mainland. Hotels that treat workers so poorly that they’ve been forced to unionize. Hotels that have taken advantage of the Maui disaster to attack their competitors and boost their profits. In the time-honored tradition of Hawaii, our politicians are proposing policies that favor colonial interests over kamaaina.
The results of New York’s effort prove that banning vacation rentals doesn’t reduce rents or increase inventory. Instead, bans benefit corporate hotels while damaging mom-and-pop operators.
And our politicians should take note: If we continue to allow colonial interests to exploit our infrastructure, our water, our beaches and our aloha … If we allow them to export their profits to the mainland … If we continue to favor mainland corporations over local families. What we will ensure is that the outmigration to Las Vegas accelerates and all that is left here on the islands are gentrified neighborhoods, homeless encampments, tenant workers and a never-ending flood of tourists handing their money to the rich, the powerful and the well-connected.
Joshua Montgomery, of Kailua-Kona, is president of the Ohana Aina Association.
