Maui’s Hotel Rezoning Path: What Bill 88 Means for the 4,500 STR Investors Who Thought They Were Out

An investor I will call Karen bought her Kihei condo in 2018 with a plan that felt rock-solid at the time. It sat on the Minatoya List, a roster of apartment-zoned Maui properties that had been operating as vacation rentals since a 2001 legal opinion blessed their grandfathered status. It was a legitimate, legal short-term rental investment in one of the most in-demand vacation markets in the country, and the numbers worked.

Then came Bill 9.

When the Maui County Council passed Bill 9 in December 2024, phasing out apartment-zoned vacation rentals by January 1, 2029 in West Maui, investors like Karen found themselves staring at an expiration date on their business model. The question was no longer how to optimize rental income. It was whether their properties would have any rental income at all in a few years.

Bill 88, passed 7-2 by the Maui County Council on June 19, 2026, changed that picture. It created two new hotel zoning classifications, H-3 and H-4, that give Minatoya List properties a potential path to continue operating legally as vacation rentals. For thousands of Maui short-term rental investors, it was the first piece of genuinely hopeful news in nearly two years.

But here is what investors need to understand clearly: Bill 88 opened a door. It did not walk anyone through it.

What Bill 9 Actually Did (And Why Investors Were Scared)

To understand why Bill 88 matters, you need the full context of what investors were facing.

Maui’s Bill 9 (Ordinance 5909) targeted a specific category of vacation rental: condos and units in apartment-zoned districts that had been operating as transient vacation rentals under grandfathered status. Hotel-zoned properties, timeshares, and bed-and-breakfasts were not touched. But the roughly 4,500 units on the Minatoya List were in the crosshairs.

Under Bill 9, signed into law by Mayor Richard Bissen on December 15, 2024, those properties would need to phase out vacation rental operations on a rolling schedule. West Maui properties face a deadline of January 1, 2029. South Maui and remaining districts face a phase-out by January 1, 2031.

For investors who had bought specifically because of Maui’s reputation as a high-revenue STR market, those deadlines felt like a countdown clock on their entire investment thesis. Financing became harder to secure. Insurance premiums, already elevated in the wake of the 2023 Lahaina wildfire, added to the financial pressure. Some buyers stepped away from the market entirely, driving condo prices down 20 to 30 percent below recent peaks even for properties already in hotel zones.

Earlier in 2026, a reversal attempt at the Maui Planning Commission level was rejected. The path forward looked dim.

Bill 88 arrived as a different kind of solution, coming not from the Planning Commission but directly from the County Council.

What Bill 88 Actually Does

The ordinance, now designated Ordinance 6008, creates two new zoning classifications within Maui County’s land use code. H-3 and H-4 hotel districts are modeled on the existing A-1 and A-2 apartment standards, essentially designed to match how these vacation rental properties have actually operated for decades.

The logic is straightforward: many of these Minatoya List complexes were built for visitor accommodations. Some have front desks, on-site management, and amenities that function exactly like hotels. Others have been operating as short-term rentals since they were built, contributing hotel-level tax revenues to Maui County without the hotel zoning to match. Bill 88 creates the legal category that could align what these properties are with how they operate.

Housing Committee Chair Nohelani U’u-Hodgins was clear about what the bill does and does not do. “This bill only establishes the district and it does not rezone any properties,” she stated during Council proceedings. Rezoning, she emphasized, must happen separately through individual applications.

That distinction is the most important thing in this entire story for investors to absorb.

The Rezoning Process: What Has to Happen Next

Bill 88 creates the framework. The rezoning process is what actually protects individual properties.

The County Council is implementing rezoning in waves rather than all at once, using a set of six policy filters to prioritize which complexes advance first:

• Timeshare status
• Leasehold designation
• Hotel-like operational characteristics (front desks, central management, commercial infrastructure)
• Affordability considerations
• Sea-level rise exposure
• Small complex size

Wave 1 consists of two resolutions. Resolution 26-110 covers properties with timeshare or leasehold characteristics, including Maui Sunset and Maui Hill in Kihei, Kahana Outrigger and Hale Mahina Beach Resort in West Maui, and several others. Resolution 26-111 addresses properties already operating with hotel-like infrastructure, including Wailea Ekahi I, II, and III, Wailea Ekolu, The Palms at Wailea, Papakea, and Maui Eldorado.

The Housing Committee approved both resolutions in early July 2026 and referred them to the Maui Planning Commission for formal land-use public hearings, which are expected in September 2026. After those hearings, the Commission’s recommendations return to the full County Council for a final vote.

Wave 2 resolutions are already under committee review for additional properties.

For investors whose properties are in Wave 1, the best realistic outcome is hotel zoning approval by late 2026 or early 2027, well ahead of the 2029 phase-out deadline in West Maui. For everyone else, the wait continues, and the process is far from guaranteed.

One complicating factor that property owners have raised is cost. TJ Victorine, a Maui property owner who testified during Council proceedings, noted that individual rezoning studies currently run $200,000 to $500,000 per property complex. He called this “prohibitively expensive” and argued it undermines the practical intent of Bill 88. Whether the County finds a way to lower that barrier for smaller complexes remains an open question.

What the Maui STR Market Actually Looks Like Right Now

Through all of this regulatory uncertainty, the underlying Maui STR market has kept performing. That is worth sitting with for a moment, because it shapes the investment calculus considerably.

StaySTRA data for June 2026 shows Maui running an average daily rate of $472 per night, up 2.97 percent year-over-year. Occupancy reached 64.3 percent, a gain of 3.78 percent compared to the prior year. Monthly revenue across all property types hit $7,941, up 17 percent year-over-year. Apartment-style units, the exact property type that the Minatoya List comprises, are generating $7,212 per month on average, up more than 16 percent over the same period.

Luxury properties on the island are commanding $857 per night. Houses are averaging $16,629 per month in revenue, up more than 24 percent year-over-year. Guests are booking 85 days in advance and staying an average of 5.6 nights per visit.

These are not the numbers of a market in distress. Demand for Maui as a vacation destination has not softened. The uncertainty is entirely on the regulatory and financing side, not the demand side.

You can dig deeper into Maui-specific revenue projections using the StaySTRA Analyzer, which lets you model returns by property type and season. For broader Hawaii context, our Hawaii STR market analysis shows why the state consistently ranks in the top tier nationally for occupancy performance.

Three Situations Investors Are Now Facing

Not every Maui STR investor is in the same position, and Bill 88 affects them differently depending on where their property sits in the process.

Already hotel-zoned properties. If you own at Royal Mauian, Mana Kai, Maui Banyan, or another complex already in hotel zoning, none of this touches you directly. You were never subject to Bill 9’s phase-out. The market softness around you has actually created buying opportunities if you are looking to expand. These properties offer certainty around rental rights that commands a premium the current market pricing does not fully reflect.

Wave 1 Minatoya List properties. If your complex appears on Resolution 26-110 or 26-111, you are in the most favorable position of the affected owners. The County has signaled through its six-filter criteria that your property type is a strong candidate for hotel rezoning. The process is not finished, but the direction is encouraging. The Planning Commission hearing in September 2026 is the next critical milestone. Owners here should be organizing their documentation now, consulting land-use attorneys familiar with Maui’s process, and monitoring Commission proceedings closely.

Minatoya List properties not yet in Wave 1. This is the harder road. Your property may still qualify for H-3 or H-4 rezoning through Wave 2 or future resolutions, but the timeline is longer and the outcome less certain. Phase-out deadlines of 2029 for West Maui and 2031 elsewhere mean there is runway, but not unlimited runway. These properties are currently trading at significant discounts that price in the uncertainty. Whether that discount represents risk or opportunity depends heavily on how the rezoning process unfolds over the next 12 to 18 months.

For any investor in this situation, I think about what a friend once told me while we were talking through a complicated real estate decision: “El que no sabe, no puede actuar.” The one who does not know, cannot act. The investors who will come out of this well are the ones who understand exactly which bucket their property is in and what the specific milestones are.

The Risks That Have Not Gone Away

Bill 88 is meaningful progress. It is not a resolution.

Multiple lawsuits challenging both Bill 9 and the rezoning framework remain active in the Second Circuit Court. The legal landscape is not settled. A court ruling could accelerate or complicate the entire process in ways that are difficult to predict.

The 2026 County Council elections are another variable. The political composition of the Council that completes Wave 1 and Wave 2 rezoning may look different from the one that passed Bill 88. Enforcement priorities can shift.

The opposition to Bill 88 was not trivial. All three county planning commissions, covering Maui, Molokai, and Lanai, recommended against the bill. The Office of Hawaiian Affairs opposed it. These bodies represent the housing affordability arguments that motivate much of the STR regulation movement statewide. That pressure does not disappear because a Council majority voted a different way.

And then there is the structural question Bill 88 raises but does not fully answer: even if a complex successfully achieves H-3 or H-4 hotel zoning, what does the operating environment look like afterward? Insurance costs remain elevated. HOA and association assessments have risen substantially post-Lahaina. The costs of running these properties have increased even as the regulatory picture has become somewhat clearer.

None of these risks mean that Maui STR investment is a bad thesis. They mean it is a more complex one than it was in 2020. Investors who understand the complexity can make informed decisions. Investors who hear “Bill 88 passed” and assume their properties are protected without doing the deeper work are setting themselves up for surprises.

If you are thinking through whether to hold, buy, or exit a Maui STR property, our complete guide to buying an Airbnb property covers the due diligence framework that matters most in regulatory markets. For broader market context, our 2026 STR market rankings show how Maui compares to alternatives across the country.

What to Watch in the Coming Months

The Maui STR situation is moving faster than most municipal regulatory processes. Here are the specific milestones that matter for investors over the next six to twelve months.

The Maui Planning Commission hearings on Resolutions 26-110 and 26-111 are expected in September 2026. These are the first hard test of whether the rezoning process will move at the pace Bill 88’s supporters envision. Significant opposition at the Commission level could slow or complicate Wave 1.

Wave 2 resolutions are still under Housing Committee review. The criteria for which additional properties make the cut, and the timeline for those hearings, will tell investors a great deal about how far the rezoning process will ultimately reach.

The active litigation in the Second Circuit Court continues as a wildcard. Any ruling that validates or strikes down components of the Bill 9 or Bill 88 framework would reshape the calculus for every Maui STR investor.

Maui STR investing has always required understanding local nuance. The market has been delivering strong returns for hosts who operate there, with revenue up 17 percent year-over-year despite the regulatory uncertainty. For investors willing to do the work of understanding their specific property’s position in this process, la oportunidad (the opportunity) is real. But the path to it requires clarity about where you stand, not just optimism about where the Council voted.

Track how Maui’s seasonal demand patterns affect your revenue model with our STR market seasonality analysis for 2026.

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