Lies, Damn Lies and Statistics about Vacation Rentals
Dear Editor, March 24, 2024
Has anybody fact-checked the numbers? We keep hearing these numbers over and over repeated by our governor Josh Green, the media and our legislature since December.
In the written testimony for the very first Hearing of SB2919 (companion bill to HB1838) on 2/2/2024 you will find the testimony by Jerry Gibson for Hawaii Hotel Alliance with attached 15 pages of a report from alltherooms.com
Jerry Gibson states in his testimony: "The significant disparity between Hawai'i DBEDT 2022 number of 15,382 STRs in Hawai'i and the actual count of 89,693 legal and illegal short-term rentals (see attached reports from alltherooms.com) underscores the urgency of reining in this industry. With a potential excess of approximately 74,000 illegal short-term rentals that are unpermitted units, the detrimental effects on affordable housing are profound."
The same data is referred to by Kekoa McClellan (American Hotel and Lodging Association), Stephanie Donoho (Kohala Coast Resort Association) and other Hotel lobbyists as well as being repeated in many news articles and interviews. If you take a closer look, it appears the data is unfortunately flawed and misleading.
The report combines listings from Airbnb, Booking.com, Homeaway, VRBO seemingly without deduplication. Most vacation rentals are listed on several booking sites.
The report includes property types like aparthotel, condohotel, hotel suite, resort which seem to represent the majority of the numbers (see blue bar chart "Property Types"). Remember the report was supposed to be about vacation rentals?
Apparently this is also the data that Josh Green keeps referring to (see Hawaii News Now video "Spotlight Now" for Feb. 6, 2024 for example). You can see Josh Green looking down during the interview when he says "89,693". He was looking at the first page of the data from "alltherooms", the same report as submitted by Jerry Gibson in his testimony (see 13:35).
One reporter seemed to have asked for a source and reported: "Green’s office was unable to explain where he got the number of “illegal” rentals, which by his math was 75,000. But the Department of Business, Economic Development and Tourism said the numbers are similar to those calculated by a local hotel industry advocacy organization, the Hawaii Hotel Alliance." (Hawaii News Now article "Lawmakers: Cracking down on illegal vacation rentals won’t solve housing crisis" dated Feb 28, 2024)
Just two days ago Governor Josh Green released "The Hawai‘i We Deserve" policy report. On page 58: "There are an estimated 30,000-89,000 STRs in the State of Hawai‘i. Only 14,000 of these rental units are legal; the remaining rental units are illegal. [30]"
He references two sources for this:
1. A Hawaii News Now article quoting the governor himself as the source: "Converting those to long-term rentals sounds easy, especially when the governor suggested thousands are illegal. “We got 89,000 short-term rentals in the state of Hawaii, of which are only 14,000 are legal,” he said, at a news conference Tuesday."
2. A UHERO blog post, which says: "Of the state’s 565,000 total housing units, 30,000 are listed as Short-term Vacation Rentals (STRs), meaning roughly 5% of local housing units operate as tourist accommodations."
It sure looks like the 30,000 is from the UHERO blog, the 89,000 is from the overblown alltherooms.com report by the Hotel industry. Well if we use the overblown number from the alltherooms report then we can calculate: 89,000 STVRs - 14,000 legal STVR = 75,000 illegal STVR, this seems to be how Josh Green and others have calculated this.
Calculating numbers like this with incorrect inputs will always result in incorrect results. Garbage in, garbage out.
The same kind of calculation is made in Jerry Gibson's written testimony: "The significant disparity between Hawai'i DBEDT 2022 number of 15,382 STRs in Hawai'i and the actual count of 89,693 legal and illegal short-term rentals (see attached reports from alltherooms.com) underscores the urgency of reining in this industry. With a potential excess of approximately 74,000 illegal short-term rentals that are unpermitted units, the detrimental effects on affordable housing are profound."
Another number we often hear is "27% of those who own vacation rentals own 20 or more units". This seems to be from the Appleseed report dated 2018 page 7. It says: "hosts with 20 or more units earned more than 27 percent of the total revenue generated by multi-unit hosts". The sentence in the report really has a very different meaning. Also again "host" doesn't mean "owner". The report adds a disclaimer: "It should be noted that the study was conducted by a group with ties to the hotel industry"
The source is reference 39 "Hosts with Multiple Units- A Key Driver of Airbnb Growth, CBRE Hotels' Americas Research, March 2017(p. 19)."
During the recent Hearing for SB2919 on 3/15 Rep. Holt chimed in to support passage of the bill: "..Statistics say that 27% of short-term rental owners own 20 or more units...", speaking to his fellow lawmakers and in front of the public. There it was again, the false data.
WHEN will someone CHECK the data? So this is the data being used to rile up the public and justify these draconian bills against vacation rentals?
Penny Lee
Kailua-Kona, Hawaii
PDF: Expanded version of letter with supporting links and diagrams
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How One East Hawaii TVR Strangled on Regulations and Fees
Aloha, March 12, 2024
I am the owner of a 4 BR single family home in Hilo that has an STVR/NUC permit. That STVR/NUC permit was obtained by the previous owner on the last possible day to get one but due to COVID he never rented it. I got lucky to get a one night rental just to keep the permit/NUC. Since then I have incurred more green waste than I want to keep track of, taken care of a leak, got lucky with renters who fixed one thing or the other and didn't get mad at me about a sewage backup that was undoubtedly caused by the previous owner, but just let me know (and I got that fixed the same day).
I wouldn't mind renting longer term if that didn't automatically give renters "squatters rights", implying possibly significant damage to the house, and mandatory mediation if rent isn't paid.
I'm currently renting my 4BR short term rental house (because it still needs work) at a rate that somebody I know was renting her spare bedroom but had to give up on that because the new regulations took her homeowners exemption away.
People who commute from wherever need places to stay.that don't exceed what they get paid working for a living.
Not everybody who comes here for a short time is a tourist. My last renter was a coworker who went out of state to take care of family and came back here because he was needed here.
The house I bought with a vacation rental permit was on the market for close to a year. If people wanted it they could have bought it. I know there was an offer before mine and the people who made that offer rescinded it after inspection.
I'm currently renting at a rate that, if the $25 + $50 penalty took effect, I'd be renting at a loss. This is in Hilo, not West Maui.
There are no resort zoned areas in Hilo, Puna or Ka'u (and probably North Hilo or Hamakua either) that include single family homes that would allow a family to stay there, especially not for families on a budget, or even single people or couples on a budget.
Maren Purves
Hilo, Hawaii
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A monstrosity built with tea leaves and pasted together with poi
Dear Editor, March 12, 2024
Hawaii is not a 2nd class state! We deserve a 1st class stadium! We don’t have a pro team so UH sports are it, here. Was Dave Shapiro right? Government officials do everything half ass? So now from the original 50,000 seat old Aloha Stadium at Halawa, the way past last minute, knee jerk about face plan is to basically tear up Ching stadium in Manoa AGAIN and cram a 25000 seat stadium into that teeny tiny manini already crowded overflowing space?
Granted, money is a consideration, but this is like a temporary problem forced into a “permanent” terrible “solution” that will stand (or maybe fall) for decades! The cost and disruption at UH to start over with this new plan rushed together will result in a monstrosity built with tea leaves and pasted together with poi.
Leighton Loo
Mililani, Oahu
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Punaluu: Abandoned buildings, golf course, and aging sewer treatment plant won’t be fixed
Dear Editor, March 8, 2024
The proposed development of the Punalu’u area has spawned a vociferous opposition not seen since the Thirty Meter Telescope protests in 2019.
This fiery community opposition seems to ignore the elephant in the room, which is Punalu’u’s deteriorating infrastructure. The abandoned buildings, golf course, and aging sewer treatment plant won’t be fixed if yet another developer given the heave-ho by the community.
Both sides need to come to an agreement that will benefit the community and the developer. In other words, both parties need to decide what kind of future is appropriate for this area.
The status quo isn’t acceptable in my mind, especially with Punalu’u’s aging infrastructure. The sewer plant alone is ticking time bomb and is likely already polluting the surrounding pristine environment. These issues won’t go away by ignoring them or hoping the government will step in and take over.
I suggest the developer consider reducing the density, and relocating their project further mauka, to help ameliorate the concerns of the community. If this isn’t acceptable, the community needs to find solutions to address the ticking time bombs and eyesores prevalent in this area without the support of the developer.
Aaron Stene
Kailua-Kona, Hawaii
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Tax Hikes Based on Scorn for Taxpayers
Dear Editor, March 1, 2024
In 2023, governance was given a vicious slap in the face with the enactment of a measure that imposes a 50% tax on tobacco products purchased online. Although some see it as about smoking and tobacco, it is much more profound, an affront to personal liberty and freedom the constitution supposedly guarantees. It was a clear demonstration of dubious and egotistic character of public leaders and their sense of superiority. It was definitely not an act of democratic mindedness. In what is supposed to be a business of the people and for the people, it was another failure. The neglect of due diligence and holding of unannounced closed door meetings for decisions are not what open and honest governance is. They are why people believe the system is without objectivity, integrity, or competence.
Control of vaping may have been the initial target, as there has been much talk about it, but legislators broadened the scope of the measure to include all tobacco products. It was not surprising as legislators are known to tax anything and everything for revenue to squander and to freely impose their selfish values. In other words, they show no honor and consideration. They condescend on people and treat them as numbers and ATMs in an Orwellian world.
It is a fact of life that people are different. Through lenses of cultures, people see and understand the world and their life challenges, values, interests, and needs differently. Although it should be the rightful perspective for governance, it is not. If it and liberty and freedom were embraced, the senses of honorable purpose, place, and direction people want and deserve would be possible.
When I served in the U.S. Army during the Viet Nam War, a carton of cigarettes cost me only $1.03 More than 30 years ago I gave up the habit but still enjoy cigars. Now I am told that a carton of cigarettes is very expensive, about $130, much of which is for taxes. It alarmed me because I never imagined that in my lifetime I would ever witness anything increase in price more than 125 fold due to taxes. The ripoff has indeed gone too far!
The action disrespects human rights. Legislators and special interest groups scorn at smokers. Have they no consideration that many smokers were the ones who stood to be counted and served in the military when the country called while they and many others would not? Some who made the ultimate sacrifice were also known to enjoy cigars. Yet, non-veterans audaciously dictate their values and habits onto others even although they were never granted the God given right. As a challenge to the constitution, the legislation is preposterous and perhaps treasonous. Legislators, however, appear oblivious of crossing the line to rule over rightfully personal matters.
When fellow veterans were apprised of the legislation, they expressed dismay, and many did so with expletives. Even those who don’t smoke were not happy because they perceived its danger as a precedent. If a person does not see it, he or she is likely either egocentric or is an advocate of socialist elitism. Many cigar smokers who defended the liberties and freedoms they believed they had are infuriated that socialists are openly dictating their values and habits via unfair tax impositions even on personal health issues and concerns that are no longer respected as individual liberties or rights. Will the socialist minded next strive to dictate whether and when birth is permitted, when driving is allowed, or maybe even when and what people eat? That this might occur is not a wild stretch of the imagination. When will the madness end? Has the socialist ideology so badly infected legislative thinking? If Shakespeare were alive, he would have shouted to them “Out damn spots.”
Sincerely,
Douglas Tom
Honolulu, Oahu