Hawaii Vacation Rentals Supply Outpaces Demand

In December 2023, vacation rentals in Hawaii experienced a rise in both supply and demand. However, the average daily rate (ADR) and occupancy decreased compared to December 2022. When comparing December 2023 to December 2019 before the pandemic, the ADR was higher, but the vacation rental supply, demand, and occupancy were lower.

The December Hawaii Vacation Rental Performance Report has been released today by the DBEDT (Department of Business, Economic Development & Tourism) of the State of Hawaii. The report is based on data gathered by Lighthouse Intelligence, Ltd.

In December 2023, the total monthly supply of statewide vacation rentals was 768,300 unit nights (+15.7% vs. 2022, -10.3% vs. 2019) and monthly demand was 410,800 unit nights (+6.8% vs. 2022, -36.4% vs. 2019). This combination resulted in an average monthly unit occupancy of 53.5 percent (-4.5 percentage points vs. 2022, -21.9 percentage points vs. 2019) for December. Occupancy for Hawaii’s hotels was 72.2 percent in December 2023.

The ADR for vacation rental units statewide in December was $318 (-1.5% vs. 2022, +35.8% vs. 2019). By comparison, the ADR for hotels was $428 in December 2023. It is important to note that unlike hotels, units in vacation rentals are not necessarily available year-round or each day of the month and often accommodate a larger number of guests than traditional hotel rooms.

The data in DBEDT’s Hawaii Vacation Rental Performance Report specifically excludes units reported in Hawaii Tourism Authority’s Hawaii Hotel Performance Report and Hawaii Timeshare Quarterly Survey Report. A vacation rental is defined as the use of a rental house, condominium unit, private room in private home, or shared room/space in private home. This report does not determine or differentiate between units that are permitted or unpermitted. The legality of any given vacation rental unit is determined on a county basis.

In December 2023, vacation rental units in Lahaina continued to be inactive due to the August 8 Maui wildfires. In December 2023, Maui County had the largest vacation rental supply at 233,300 available unit nights (+11.3% vs. 2022, -20.4% vs. 2019). Unit demand was 127,900 unit nights (-1.5% vs. 2022, -44.7% vs. 2019), resulting in 54.8 percent occupancy (-7.1 percentage points vs. 2022, -24.2 percentage points vs. 2019) and ADR at $394 (+0.8% vs. 2022, +41.6% vs. 2019). For December 2023, Maui County hotels reported ADR at $612 and occupancy of 68.7 percent.

Oahu vacation rental supply was 212,700 available unit nights in December (+12.7% vs. 2022, -10.4% vs. 2019). Unit demand was 117,600 unit nights (+6.9% vs. 2022, -34.6% vs. 2019), resulting in 55.3 percent occupancy (-3.0 percentage points vs. 2022, -20.4 percentage points vs. 2019) with ADR at $258 (+1.2% vs. 2022, +34.5% vs. 2019). In comparison, Oahu hotels reported ADR at $321 and occupancy of 75.5 percent for December 2023.

The island of Hawaii vacation rental supply was 194,000 available unit nights (+20.2% vs. 2022, -5.1% vs. 2019) in December. Unit demand was 100,500 unit nights (+10.8% vs. 2022, -31.6% vs. 2019), resulting in 51.8 percent occupancy (-4.4 percentage points vs. 2022, -20.1 percentage points vs. 2019) with ADR at $250 (-6.9% vs. 2022, +37.6% vs. 2019). Hawaii Island hotels reported ADR at $560 and occupancy of 67.7 percent.

Kauai had the fewest number of available vacation rental unit nights in December at 128,300 (+22.8% vs. 2022, +5.2% vs. 2019). Unit demand was 64,900 unit nights (+19.4% vs. 2022, -26.0% vs. 2019), resulting in 50.5 percent occupancy (-1.4 percentage points vs. 2022, -21.3 percentage points vs. 2019) with ADR at $384 (-1.5% vs. 2022, +30.7% vs. 2019). Kauai hotels reported ADR at $489 and occupancy of 67.3 percent.

For the full year of 2023, Hawaii vacation rental supply was 8.8 million unit nights (+17.2% vs. 2022, -14.5% vs. 2019) and demand was 4.9 million unit nights (-0.7% vs. 2022, -35.5% vs. 2019). The average daily unit rate for 2023 was $301 (+1.8% vs. 2022, +45.1% vs. 2019). Statewide vacation rental occupancy for 2023 was 55.9 percent (-15.3 percentage points vs. 2022, -24.6 percentage points vs. 2019). In comparison, statewide hotel ADR for 2023 was $378 and occupancy was 74.7 percent.