The Hawaii Tourism Authority is an agency in Hawaii that is responsible for the market research related to travel to the State of Hawaii. Amongst other things, they provide comprehensive reporting on airline capacity, cruise capacity, which islands people are choosing to stay at, and what accommodation type people are choosing.
While hotels are the most popular place for people to stay, there has been a growing trend over the last 10 years for vacation rentals in the State of Hawaii as well as across the US. The Hawaii Tourism Authority recently began to give vacation rental specific reporting, which is very insightful.
There most recent report can be found here and the trends seem to be in line with what we are seeing as well as the data does appear to be an ongoing trend and not just for the month of July. While 2021 and 2022 were great years, they are far from the normal for the State of Hawaii so they chose to compare the data to 2019, which seems more relevant. Here is some breakdown of the data.
As expected, Maui is struggling due to the fires. There was a significant decrease in demand as well as supply. On the positive, the nightly rate was able to stay at a significantly higher mark than 2019.
The Big Island of Hawaii was the only island that saw an increase in supply. This is interesting because it is the latest island to implement vacation rental laws, which restricts the renting of vacation rentals in certain areas. These laws have traditionally decreased the supply of vacation rentals once an island implements this. Maui as well as Oahu have implemented similar policies in years prior.
All the islands saw a significant increase in average daily rate. The rates have been steadily increasing across the islands since 2021 due to demand as well as the recent increase in cost of doing business in the State of Hawaii. More than likely directly related to this is a decrease in demand almost equal to the increase in average daily rate. It is likely that the cost increase is fairly significantly related to the occupancy decrease. On the positive, these two cancel each other out giving vacation rental homeowners the same revenue as 2019.
The month of July seems to be a good indicator of the rest of the year. We suspect for vacation rentals for demand to get closer to the supply for the winter months as well as a high average nightly rate being maintained.