Image courtesy airbnb

Consider long term effects of rental ban

By Damien Perez, Staff Writer

The Lahaina tragedy and its dormancy of income to the economy has been felt in every portion of the island.

Studies show that almost 20% of tourists have chosen to vacation elsewhere. When dealing with business, everyone knows that the sucker takes the quick decision because it’s flashy. However, long term effects may cause property prices to plummet, jobs to be lost, and may even force you or your family to move elsewhere.

What may be a quick emotional decision may be a “not welcome” sign to tourists. That seems like a great idea to many of us who are inconvenienced by some of their unruly behavior. However, any economist will stress to not make an emotional decision when the largest part of our economy may be at stake.

As I’ve grown-up, I always try to look at every side of a topic with no value given towards the short-term effects. Personally, I’m indifferent to this decision because even though I’ve lived here a handful of years, this is not my decision to make.

NO TOURISTS…NO ECONOMY….

Does it seem like a smart business decision to eliminate an extremely popular resource to tourists? Is the boisterous behavior of a small percentage of tourists worth losing another major part of our tourist economy?

Everyone who complains about tourists would not feel the same way if the main source of income slowly dried up. I think when your family needs to move to the desert in Nevada or Arizona, you may wish to see a haole. By then it may be too late to get their presence and their money to drive the Maui economy. 40% of our economy in Maui is based on tourism. If this result eliminates even 2%, there is a guarantee one or more of your family members will have to leave the island.

WILL THE BAN ENABLE INEXPENSIVE HOUSING?

The Maui County Council meets Tuesday to vote on the agenda for an affordable housing project at 258 Kupuohi St. Federal and state money is pouring in. Why accept a short-term solution when we can have both?

Let’s face it, development, retail and healthcare are significant industries, but not one can stand on its own without the constant flow of money through the tourism pipeline. There is no industry that can sustain the consistent and excess income for enough people to spend the money an economy needs.

The resorts try to make us think their best interest is to keep the tourists in those areas.

We are not the first town to want to implement a short-term rental ban (STRB), but if we initiate the ban, we would hopefully be the first area to have a successful outcome.

RESULTING OUTCOMES OF STRB

Short-term effects on most decisions tend to not be residual. The long-term rewards and consequences should be the determining factor in every decision in which an adult or a business owner forms an opinion.

In this short-term housing ban, one thing is apparent to me. Most people living here see this decision as a victory against disrespectful tourists.

In reality, this was initiated by the hotel industry lobbyists and not a grassroots effort to help the people of Maui.

Jumping on the team of the hotels would be a regret. These are the same places which are responsible for using most of our island’s water and drying out our land, thus making it much more of a fire hazard.

TAX REVENUE:

The fact is that municipalities are able to provide more public services due to the substantial tax revenue from short-term rentals. It is a significant spur to the economy.

Do you like your public bathrooms clean or operational? How about the quality of your beach parks? How about the countless aspects we take for granted? A large portion is indirectly supplied from the tax dollars of tourists in short-term rentals.

Real Estate Weekly states the significant drop in revenue due to short-term rental bans.

“Work has been done to bridge differences in areas like Maui County, where leading STR marketplaces have provided assistance in helping to enforce vacation rental laws”

A recent, and surprising, Harvard Business Review study found that cities that curb STRs negatively affect development, while cities with a robust STR market are more likely to have upgraded development and faster growth.

WHAT IS THE ANSWER?

A HARVARD BUSINESS study found a direct correlation between cities where short-term rentals are hurting development and growth.

“These are practical, actionable solutions that have the potential to positively address a specific issue and contribute to stabilizing the local economy over time.”

Instead, any decision considering the opposition’s points of view is essential to making a comprehensive long term decision which will not cripple your economy.

We have all seen the smallest change crack an economy and slowly cause splits. The most unstable factor citizens actively alter is their own economy. Most economies are severely unstable. A tourist economy is the most volatile, so huge altering decisions may cause an economic collapse.

With Lahaina being dormant, is this a good choice to combine both changes?

In every city, tourists can be annoying. But Maui is a tourist-based economy. Resorts and hotels lobby for this in theory that the same visitors which will be banned from short-term rentals will decide to completely alter their idea of a vacation and stay inside of a resort.

Although my viewpoints seem to dissuade against the short-term rental ban, I have witnessed Mayor Bissen and his team make conscious, decisive actions to keep the community together and always have a voice. So, if Bissen wants it, let’s ride it out. I am confident in his leadership and staff to make the appropriate decision.

Damien Perez is a staff writer for The Maui News.