With the popularity of companies like Airbnb, vacation rentals have flooded the Maui market. Many are illegal- operating without the proper permit or paying transient accommodation taxes. Unfortunately this also means a large chunk of what was long-term rentals are now only available to vacationers, making a serious residential housing crunch. The County of Maui is taking strong steps to crack down on the problem.The county hired LODGINGRevs, a Colorado-based company, earlier this year to produce a list of potentially illegal operators.The next step comes on Nov. 6 when Maui County voters will get to decide whether to increase illegal rental fines from $1,000 to $20,000, and $10,000 every day of violation after that. Even with increased fines, the county must chase down those who have yet to pay up, which isn’t easy.
The county searches for illegal short-term rentals is through advertisements, usually online. Some times leads come neighborhood complaints.
Illegal operators get a notice of warning first, giving them seven days to shut down. If the county finds no evidence of continuing operations after a week, the case is closed. If there is continued evidence of advertising or operation, then a notice of violation is issued, along with $1,000 in initial fines and $1,000 for every day of violation after that.
There are some tricky ways some property owners have avoided detection of illegal rentals, but with potentially growing fines, the risk is not worth the trouble. Owners can apply for a transient accommodation license, but there are limited permits available for each community.
If you know of anyone with a vacation rental that would like to convert it to a long term rental, we can help. We offer full management services, and can also help sell a home or condo.