Airbnb & VRBO Performance in Kona Hawaii.

Short-Term Rental Regulations in Kona, Hawaii for 2024

General Regulations

• Registration Requirements: All short-term rentals (transient accommodation rentals) must be registered with the county. This includes providing information about the property, owner, operator, emergency contact, and safety equipment.

Zoning and Location

• Permitted Zones: Short-term rentals are allowed in V, CG, and CV districts, as well as in residential and commercial zoning districts situated in the General Plan Resort and Resort Node areas, and in RM districts for multifamily dwellings with a condominium property regime.

Licensing and Fees

• Licenses: Owners must obtain a transient accommodations tax (TAT) license and a general excise tax (GET) license from the Hawaii Department of Taxation. The TAT license costs $5 for 1-5 units and $15 for 6+ units, while the GET license costs $15.
• Registration Fees: Different types of short-term rentals have specific registration fees, although some amendments aim to simplify and reduce these fees.

Operational Standards

• Standards of Conduct: Defined standards of conduct must be adhered to, including quiet hours and guest limits. Non-compliance can result in fines and other penalties.

Insurance Requirements

• Liability Insurance: Properties must have short-term rental insurance providing at least $1,000,000 in general liability coverage.

Enforcement and Penalties

• Enhanced Enforcement: Recent updates include enhanced enforcement mechanisms and higher penalties for non-compliance, such as hefty fines, suspension of rental operations, and legal action.

Categories of Short-Term Rentals

• Hosted vs. Unhosted Rentals: Bill 121 categorizes short-term rentals into hosted (owner-hosted) and unhosted types, with different regulations and fees. Owner-hosted rentals require the owner to live on the same property and offer cheaper registration fees and more zoning flexibilities.

Amendments and Simplifications

• Simplified Registration: Amendments have been made to simplify the registration process, such as omitting the submission of a floor plan and not requiring rentals to meet current construction code requirements.
• Grandfathering: Existing short-term rentals that did not need to register under current law can be grandfathered into the new law.

Community Impact

• Affordable Housing: The regulations aim to address the affordable housing crisis by reducing speculative property investment in residential and agricultural areas and encouraging the construction of ‘ohana units for family or long-term rental use.
• Economic Considerations: The laws are designed to balance the economic benefits of short-term rentals with community concerns, such as noise, trash, and crowded parking.

Top Neighborhoods for Airbnb Revenue in Kona, Hawaii

1. Kailua Kona

• Appeal: Kailua Kona is a hot vacation destination known for its sunny weather, historic sites, and vibrant oceanfront activities. It attracts a wide range of tourists, from those seeking luxury beachfront villas to those looking for cozy condos.
• Revenue Potential: Properties in Kailua Kona can generate significant revenue, with average nightly rates projected to be over $290 for a 2-bedroom vacation rental. The area boasts a high occupancy rate and strong tourism demand, ensuring a steady flow of guests.

2. Kohala Coast (adjacent to Kona)

• Appeal: Although technically on the northwest side of the Big Island, the Kohala Coast is often associated with the broader Kona area due to its proximity and similar tourist appeal. It is renowned for its luxury resorts, pristine beaches, and excellent golf courses, attracting a more affluent clientele.
• Revenue Potential: The high-end nature of the Kohala Coast allows for higher rental rates, making it an attractive option for investors. However, it is crucial to navigate strict zoning regulations and consider professional property management to maintain top-notch services for guests.

3. Waikoloa (near Kona)

• Appeal: Waikoloa is another area near Kona that offers a mix of luxury and convenience. It features shopping centers, golf courses, and is close to various tourist attractions, making it appealing to a broad audience.
• Revenue Potential: While the nightly rates in Waikoloa might be slightly lower compared to Kailua Kona, the area still offers a strong potential for revenue due to its high demand and limited supply of hotel rooms. The average nightly rate can be around $300-$400, and the occupancy rate is relatively high.

Key Factors for Appeal

• Strong Tourism Demand: All these areas benefit from a steady stream of tourists drawn to Kona's historical significance, outdoor adventures, and luxurious amenities.
• Diverse Accommodations: From luxury beachfront villas to cozy condos, these neighborhoods offer a range of accommodations that cater to different preferences and budgets.
• High Occupancy Rates: High occupancy rates in these areas ensure consistent demand for lodging options, making them lucrative for Airbnb investors.
• Proximity to Attractions: The proximity to popular beaches, golf courses, shopping centers, and cultural attractions enhances the appeal of these neighborhoods for guests.

Furnishing and Design Tips for an Inviting Airbnb in Kona, Hawaii

Design Inspiration and Aesthetic

• Reflect Local Culture: Incorporate Hawaiian motifs such as local art, ocean-themed prints, and vibrant color palettes to create an authentic and welcoming atmosphere.
• Coastal and Tropical Elements: Use light, airy fabrics and natural materials like wood and bamboo to resonate with the coastal and tropical environment of Kona.

Key Amenities and Features

• Outdoor Spaces: Include patios, balconies, or lanais that provide stunning views, allowing guests to relax and enjoy the surroundings.
• Pools and Hot Tubs: Offer these amenities for guests to unwind after exploring the area.
• Air Conditioning: Ensure guests remain comfortable in the warm Hawaiian climate.
• High-Speed Internet: Provide reliable internet access for guests who need to stay connected.

Functional and Durable Decor

• Functional Entryway: Create an inviting and functional entryway with mirrors, baskets for keys and shoes, and other practical elements.
• Multipurpose Furniture: Choose furniture that is functional, durable, affordable, easy to clean, and multipurpose to cater to various guest needs.
• Comfortable Bedding: Invest in quality bedding, such as 100% cotton sheets and duvet covers, to ensure guest comfort.

Themed Rooms and Details

• Themed Rooms: Design rooms with specific themes, such as a bohemian vibe or a black and white textured look, to create unique and welcoming spaces.
• Local Travel Guides: Provide local travel guides and information about the area to enhance the guest experience.
• Welcome Baskets: Offer welcome baskets with essentials like coasters, books, and toiletries to make guests feel at home.

Statement Pieces and Budgeting

• Statement Pieces: Invest in high-quality, statement pieces such as couches, coffee tables, and dining room tables that define the space, even if it means splurging a bit.
• Budget Management: Choose your budget battles wisely, focusing on essential items and compromising on less critical ones to stay within budget.

Additional Touches

• Plants and Greenery: Add plants, either real or faux, to liven up the space and enhance the tropical ambiance.
• Artwork and Gallery Walls: Use local artwork, vintage prints, and watercolor paintings to create unique and welcoming gallery walls.
• Coffee Station: Set up a designated coffee station in the kitchen with extra coffee and filters to cater to guests' morning routines.

Discover Kona, Hawaii: Local Attractions and Insider Tips for Your Guests

Historical and Cultural Sites

• Hulihe‘e Palace: A historic palace built in 1838, home to Hawaiian royalty, now preserved as a museum with original furnishings and Hawaiian artifacts. Located on Ali‘i Drive in Kailua-Kona.
• Kaloko-Honokōhau National Historical Park: An ancient Hawaiian temple and fishing village offering interactive educational programs and guided cultural tours. A must-visit for history enthusiasts.
• Moku‘aikaua Church: Hawai‘i’s first Christian church, founded in 1820 by missionaries Asa and Lucy Thurston. The church is constructed from local lava rock and still in use today.
• Kamakahonu: The site of King Kamehameha I's royal residence, featuring the reconstructed ‘Ahu‘ena Heiau temple. Located on the property of the King Kamehameha Beach Hotel.
• Pu‘uhonua o Hōnaunau National Historical Park: A sacred site that served as a sanctuary for those who broke the law. Now a 180-acre park with reconstructed temples, royal fishponds, and stunning ocean views.

Beaches and Outdoor Activities

• Manini‘owale Beach (Kua Bay): A picturesque white-sand beach with clear turquoise waters, located in Kekaha Kai State Park. Ideal for a day of relaxation and water activities.
• Kealakekua Bay: A top snorkeling destination known for its clear waters and abundant marine life. Accessible by kayak or boat tour.
• Kahalu’u Beach Park: A family-friendly beach for snorkeling, surfing, and swimming, with modern facilities and easy access.
• White Sands Beach Park: Known for its versatile beach activities including bodysurfing, surfing, and snorkeling. Hosts the annual Magic Sands Bodysurfing Championship.

Unique Experiences

• Manta Ray Night Snorkel/Dive: A unique opportunity to swim with manta rays under the light of a spotlight that attracts plankton, drawing these gentle giants close to snorkelers and divers.
• Kona Coffee Tours: Visit local coffee plantations to learn about the coffee-making process and taste some of the world’s best coffee. Recommended tours include Heavenly Hawaiian Coffee Farm and Mountain Thunder Coffee.
• Seahorse Farm Tour: An educational tour at Ocean Rider Seahorse Farm where you can see and interact with seahorses and other marine animals.

Dining, Shopping, and Local Events

• Ali‘i Drive: A lively street in Kailua-Kona with shops, restaurants, and cafes offering local cuisine and souvenirs. Maintains a local vibe with independent shops and eateries.
• Farmers Markets: Regular markets where guests can find fresh produce and support the local community.
• Kokua Kailua: A monthly art stroll through historic Kailua Village, featuring local artisans and craftspeople.

Insider Tips

• Check Conditions: Always check with lifeguards for current conditions before engaging in any outdoor activities.
• Respect Local Culture: Be mindful of historical sites and respect any rules or guidelines to preserve these cultural treasures.
• Explore Local Flavors: Try traditional Hawaiian dishes and local brews to fully experience the flavors of Kona.
• Guided Tours: Consider guided tours for snorkeling, coffee tastings, and cultural sites to get the most out of your visit.
• Community Events: Attend local events like the Kona Coffee Festival or the Magic Sands Bodysurfing Championship to immerse yourself in the community.

Practical Tips to Run a Successful Short-Term Rental Business in Kona, Hawaii

To ensure a smooth and enjoyable experience for both you and your guests, several practical tips can make a significant difference in running a successful short-term rental business in Kona, Hawaii.

Noise Regulations and Quiet Hours

Inform your guests about noise regulations and quiet hours to maintain a peaceful environment, especially in residential areas. Clearly communicate these rules in your digital and physical house manual to avoid any potential issues.

Comprehensive House Manual

Create a detailed digital and physical house manual that includes essential instructions, Wi-Fi passwords, and other important information. This manual should cover everything from appliance usage to emergency contact details, ensuring guests have all the information they need at their fingertips.

Simplified Check-in Process

Utilize smart locks to streamline the check-in process, eliminating the need for physical key exchanges. Provide clear instructions on how to use the smart locks, along with parking instructions accompanied by photos to help guests navigate the property easily.

Additional Considerations

• Local Regulations: Be aware of and comply with local zoning restrictions, permit requirements, and taxes such as the Transient Accommodation Tax (TAT) and General Excise Tax (GET).
• Amenities and Maintenance: Ensure your property is well-maintained, with amenities like air conditioning, pools, and outdoor spaces that cater to the high demand for resort-style vibes in Hawaii.
• Proximity to Attractions: Choose properties near popular attractions like Hawaiʻi Volcanoes National Park or Punaluʻu Beach to enhance the appeal of your rental.

By following these tips, you can enhance the guest experience, reduce potential issues, and ensure a successful and profitable short-term rental business in Kona, Hawaii.

Here is a brief list of house cleaning, repair, and maintenance providers in Kailua Kona, Hawaii:

House Cleaning Services

• Aloha Bliss Cleaning:
• Locally owned, licensed, and insured.
• Serves Kailua Kona and surrounding areas.

• Offers residential, vacation rental, and hourly cleaning services.

• Big Island Cleaners:

• Locally owned and operated.
• Specializes in vacation rentals, residential homes, offices, move-out/deep cleans, and property management.

• Also offers co-hosting services for vacation rentals.

• Kona Paradise Cleaning:

• Provides quality, professional, and reliable cleaning services for homes, offices, and vacation rentals.

• Akamai Cleaning Services:

• Licensed, bonded, and insured.
• Offers professional cleaning services in West Hawaii.

Additional Services

• Big Island Cleaners:
• Includes property management services and partnerships with remodel specialists and maintenance professionals.

These providers offer a range of cleaning and maintenance services tailored to different needs in the Kailua Kona area.

Short-Term Rental Management Fees in Kailua-Kona, Hawaii: A Comprehensive Guide

In Kailua-Kona, Hawaii, managing short-term rentals involves a range of fees that can vary significantly based on the level of service provided. Typically, management fees for short-term rentals range from 10% to 30% of the rental revenue. Full-service management companies, such as MasterHost and AA Oceanfront, which handle everything from guest communication, marketing, and pricing optimization to property maintenance and concierge services, tend to charge on the higher end of this spectrum, often around 12% to 20% of the rental revenue.

On the other hand, basic services that focus on essential tasks like booking management and guest screening might be more affordable, starting at around 8% to 10% of the rental revenue. Additional fees can also apply for services such as cleaning, repairs, and interior design, which may be charged separately or included in the overall management fee. Understanding these fee structures is crucial for property owners to ensure they are maximizing their revenue while complying with local regulations and maintaining high standards of property management.