Hawaii Landlord-Tenant Law 2026: HRS Chapter 521, No Rent Control in Any County, Honolulu’s Bill 41 STR Crackdown, and the Maui Wildfire Housing Emergency

Hawaii has no rent control anywhere in the state in 2026 — not in Honolulu, not in Maui, not on the Big Island, not on Kauai. The state’s landlord-tenant framework is governed by HRS Chapter 521 (the Hawaii Residential Landlord-Tenant Code, enacted 1974, based on the Uniform Residential Landlord and Tenant Act). The statute requires a one-month deposit cap, imposes the fastest mandatory deposit return deadline of any Pacific state (14 days), mandates 5% per annum interest on security deposits, and levies treble (3×) damages against landlords who wrongfully withhold deposits. But Hawaii’s landlord market is shaped by forces that have no mainland equivalent: a military community of 100,000+ (anchored by Joint Base Pearl Harbor-Hickam), a Jones Act economy where Matson Navigation controls island-bound freight, Honolulu’s 2022 platform-level STR crackdown (Bill 41) that pushed 6,000–8,000 vacation rental units into the long-term rental market, and the August 2023 Lahaina wildfire — the deadliest US wildfire since 1918 — that displaced 12,000 Maui residents and permanently reset West Maui’s housing supply.

HRS Chapter 521: The Hawaii Residential Landlord-Tenant Code

Hawaii adopted the Uniform Residential Landlord and Tenant Act (URLTA) in 1974, making it one of the earlier states to enact URLTA-based landlord-tenant legislation. The statute, codified as HRS Chapter 521, covers all residential rental agreements in the state except owner-occupied units with two or fewer bedrooms, rental agreements for occupancy as part of employment, and occupancy in a religious or military facility. HRS §521-5 explicitly provides that the Act supersedes all conflicting provisions of prior rental agreements, making the statute’s protections non-waivable by contract.

The primary regulatory areas of HRS Chapter 521:

Security Deposits (HRS §521-44)

Hawaii’s security deposit law is one of the most comprehensive and tenant-protective in the Pacific region. The four core requirements are:

(b) One-Month Cap: Landlords may not require a security deposit exceeding one month’s rent. This cap applies regardless of the lease term, the tenant’s credit score, or the value of furnished goods in the unit. Refundable last-month’s-rent deposits are included in the cap calculation.

(c) 14-Day Return with Itemized Statement: After the tenant vacates the dwelling unit and provides the landlord a written forwarding address, the landlord has exactly 14 days to return the full deposit (plus 5% interest) or, alternatively, to return any remaining portion after documented deductions accompanied by a written itemized statement specifying each deduction and its dollar amount. The 14-day deadline runs from the later of: (i) the date the tenant actually vacates, or (ii) the date the tenant provides the forwarding address. Landlords who never receive a forwarding address face legal uncertainty but should make reasonable efforts to contact the tenant within 14 days of vacation. Under Hawaii case law, the landlord’s failure to provide a timely itemized statement waives the right to withhold any portion of the deposit even for legitimate damages.

(d) 5% Per Annum Interest on Deposit: Hawaii requires landlords to pay interest on the security deposit at 5% per annum, accruing from the date of receipt. This interest obligation must be satisfied at the time of deposit return. For a $1,500 deposit held 18 months, the mandatory interest payment is $112.50. For a $2,500 deposit held two years, it is $250. Hawaii is one of only a handful of US states that mandates deposit interest — the others being Massachusetts (5% or actual rate, M.G.L. Ch. 186 §15B(3)), Connecticut (Banking Commissioner rate, CGS §47a-21(i)), and New York (for buildings of 6+ units, RPL §7-103). The overwhelming majority of states including California, Oregon, Washington, Nevada, Arizona, Texas, Florida, Georgia, Virginia, Ohio, Michigan, Wisconsin, and Iowa impose no deposit interest obligation. Hawaii landlords must hold deposits in an account capable of earning or crediting 5% per annum and must calculate and pay or credit the interest at move-out.

(e) Treble (3×) Damages for Wrongful Withholding: Any landlord who fails to return the deposit, pay accrued 5% interest, or provide a timely itemized statement within the 14-day window is liable to the tenant for three times the amount wrongfully withheld, plus the tenant’s reasonable attorney’s fees and costs. Hawaii’s 3× treble damages penalty is stronger than California (2×, Civ. Code §1950.5(l)), Oregon (2×), Washington (2×), Nevada (2×), and Rhode Island (2×). In practical terms, a landlord who incorrectly withholds $1,500 from a Hawaii tenant and fails to provide any itemization faces a statutory minimum claim of $4,500 plus attorney’s fees — frequently making district court litigation economically worthwhile for the tenant even for small deposits.

Non-Payment of Rent: 5-Day Demand (HRS §521-68)

If a Hawaii tenant fails to pay rent when due, HRS §521-68(a) requires the landlord to serve a written demand (in person or by mail) specifying the amount overdue and requiring the tenant to pay all overdue rent within 5 days or surrender possession of the dwelling unit. The 5-day period is a calendar-day count beginning the day after service. Unlike Iowa (§562A.27) or Kansas (K.S.A. §58-2564) — which explicitly provide that a tenant who pays within the notice period cures the default and the landlord must resume the lease — Hawaii’s statutory text does not provide an express cure-right in identical terms. Hawaii District Courts, applying URLTA principles from which HRS Chapter 521 derives, have generally held that a tenant who tenders full payment before the landlord files a summary possession complaint cures the default. After the 5-day period without cure, the landlord may file a summary possession complaint in the appropriate District Court.

Which court? Hawaii is divided into judicial circuits by island:

• O’ahu (Honolulu City & County): District Court of the First Circuit, 1111 Alakea St., Honolulu, HI 96813
• Maui, Molokai, Lana’i: District Court of the Second Circuit, 2145 Main St., Wailuku, HI 96793
• Big Island (Hawaii County): District Court of the Third Circuit, 75 Aupuni St., Hilo, HI 96720 (Kona: Kealakehe Courthouse)
• Kauai: District Court of the Fifth Circuit, 3970 Ka'ana St., Lihu'e, HI 96766

Hawaii has no Housing Court equivalent to New York City’s Housing Part or Connecticut’s Housing Session of Superior Court. All eviction (summary possession) cases proceed through the regular District Court system. Hawaii District Court judges handle both civil and criminal matters; there are no dedicated housing judges.

Landlord Entry (HRS §521-53)

Hawaii landlords must provide at least 2 days’ (48 hours’) advance notice before entering a tenant’s unit for non-emergency purposes including inspections, repairs, showings to prospective tenants or buyers, and pest control. Entry must be at reasonable times. Emergency entry without notice is permitted when the landlord reasonably believes an emergency (fire, flood, structural failure) requires immediate action to prevent serious damage or injury. Unlike some states that require 24 hours (California, Illinois, Virginia) or 1 day (Oregon), Hawaii’s 48-hour requirement is more protective of tenant privacy. Landlords who violate entry rules face actual damages and may be liable for breach of the covenant of quiet enjoyment under HRS §521-42.

Prohibited Practices and Retaliation (HRS §521-74.5)

Hawaii’s anti-retaliation provision prohibits landlords from increasing rent, decreasing services, threatening eviction, or taking other adverse action against a tenant within 90 days of the tenant having (a) complained to a government agency about a housing code violation, (b) complained to the landlord about a habitability defect, (c) organized or joined a tenant organization, or (d) exercised any legal right under HRS Chapter 521. If a landlord takes an adverse action within 90 days of a protected tenant activity, there is a rebuttable presumption of retaliation. Retaliation is an affirmative defense to eviction.

Habitability (HRS §521-42)

Hawaii’s implied warranty of habitability requires landlords to maintain residential units in a condition that (a) complies with applicable health and housing codes materially affecting health and safety; (b) provides effective waterproofing and weatherproofing including unbroken windows and doors; (c) maintains plumbing in good working order with hot and cold running water; (d) provides adequate heat for health and comfort; (e) keeps electrical systems in safe working order; (f) keeps units free from significant pest infestations; and (g) maintains common areas in clean and safe condition. Hawaii’s habitability standards are generally considered robust given the climate — mold from humidity and pest infestations from tropical insects are recurring issues. Note for O’ahu: the City and County of Honolulu requires all residential rental units to have a Residential Landlord-Tenant Permit (also called a rental registration), which must be obtained before advertising or renting a unit and must be renewed. Honolulu landlords who fail to obtain the required permit may be unable to enforce lease terms or collect rent in court proceedings.

Rent Control in Hawaii: None in Any County, Despite Extreme Affordability Crisis

Hawaii has the most expensive housing market in the United States by most measures — and yet no county has ever enacted rent control. This paradox reflects Hawaii’s unique political economy: the state has a strong landlord lobby concentrated in large institutional landholders (Kamehameha Schools, James Campbell Company, Alexander & Baldwin, Castle & Cooke), a tourism industry with economic interests in maintaining property values, and a state legislature that has historically deferred to county home rule on land-use matters without directing counties to enact tenant protections.

The statistics are stark. Honolulu’s median single-family home price exceeded $1,100,000 in 2025 — the highest in any major US city outside of certain California markets. Maui County’s median single-family home price exceeded $1,300,000 in 2025. The average Honolulu 2-bedroom apartment rents for $2,000–$2,800/month. Hawaii workers earning the state’s 2026 minimum wage of $16.00/hour ($33,280/year gross) spend 72–101% of their gross income on the average 2BR apartment — a ratio unmatched in any mainland state.

Despite periodic advocacy campaigns — by groups including the Hawaii Appleseed Center for Law & Economic Justice, the ACLU of Hawaii, and community housing organizations in Maui and Honolulu — no formal rent stabilization or rent control legislation has been enacted in any Hawaii county. The specific legislative attempts include:

• Maui County (2022–2023): In the aftermath of the wildfire and a pre-existing housing shortage, Maui County Council members introduced resolutions calling for emergency rent stabilization in West Maui. Hearings were held, advocacy was intense, but a formal rent control ordinance was not enacted. The county instead relied on the Governor’s emergency price-gouging prohibition (which limited rent increases above pre-disaster levels) and on expanded short-term vacation rental restrictions to redirect units to long-term tenants.
• State Legislature (2022): Senate Bill 2919 and House Bill 1623 proposed state-level rent stabilization frameworks, including a cap of 5% above CPI. Both died in committee in 2022.
• Honolulu City Council (recurring): City Council resolutions calling for feasibility studies on rent control have been introduced multiple times in the 2018–2026 period. None have advanced to ordinance status.

The legal framework for rent control in Hawaii would not require a statewide preemption repeal — Hawaii has no such preemption statute. Unlike Texas (LGC §214.902), Wisconsin (Wis. Stat. §66.1015), Michigan (MCL §123.409), Illinois (765 ILCS 720), Tennessee (T.C.A. §66-35-102), Missouri (RSMo §441.043), or Kansas (K.S.A. §12-16,130), Hawaii has never legislatively preempted local rent control. Under Hawaii Constitution Art. VIII, counties have broad home rule authority. A county seeking to enact rent control would need only a County Council ordinance. The barriers have been political and economic, not statutory.

Practical implication for Hawaii landlords in 2026: Market-rate rent increases remain fully permitted at lease renewal, subject only to the contractual notice period in the existing lease (typically 30 days for month-to-month tenancies). The landlord must give 45 days’ written notice to raise rent for a periodic tenancy under HRS §521-21(d). No formula, cap, CPI adjustment, or banking provision applies. Hawaii landlords operate in the freest rent environment of any state with a comparably severe housing-cost burden.

Joint Base Pearl Harbor-Hickam (JBPHH): Hawaii’s Largest Employer Complex

Joint Base Pearl Harbor-Hickam — created October 1, 2010 by merging Naval Station Pearl Harbor and Hickam Air Force Base under the Base Realignment and Closure (BRAC) 2005 directive — is the largest single employment concentration in the State of Hawaii. Located on the south shore of O’ahu, approximately 10 miles west of downtown Honolulu, JBPHH spans approximately 4,400 acres and is home to approximately 40,000 active-duty service members and 10,000–12,000 US government civilian employees, plus an estimated 30,000–40,000 family members and dependents living on or near the base.

Major commands based at JBPHH:

• US Pacific Fleet (COMPACFLT): Commanding all US Navy forces in the Pacific and Indian Oceans; headquartered at Camp H.M. Smith (adjacent to Pearl Harbor); responsible for approximately 60% of the globe’s ocean space; ~200 ships, ~1,200 aircraft, ~130,000 Navy personnel
• Pacific Air Forces (PACAF): Air Component Command of US Indo-Pacific Command (USINDOPACOM); Hickam Field at JBPHH; approximately 46,000 Air Force personnel across 5 air bases in Pacific
• US Indo-Pacific Command (USINDOPACOM): Combatant command for the entire Indo-Pacific region (~52% of the earth’s surface); Camp H.M. Smith, O’ahu; largest US military combatant command by geographic area
• USS Arizona Memorial / Pearl Harbor National Memorial: 1.7 million visitors per year; managed by NPS in partnership with Navy; honors 2,403 killed in December 7, 1941 attack
• Pearl Harbor Shipyard: Naval shipyard supporting submarine and surface ship maintenance; major employer of civilian engineers and tradespeople in Honolulu metro

Schofield Barracks (Wahiawa, central O’ahu, ~22 miles north of Honolulu) is the home of the 25th Infantry Division (“Tropic Lightning”), one of the Army’s most deployed light infantry divisions. Schofield hosts approximately 14,000–17,000 Army soldiers, plus family members, making it one of the Army’s largest overseas garrison populations. The adjacent Wheeler Army Airfield and Schofield housing areas extend across central O’ahu.

Marine Corps Base Hawaii (MCBH) Kaneohe Bay (Windward O’ahu, ~16 miles northeast of Honolulu) is home to approximately 12,000 Marines and sailors, including the 3rd Marine Regiment and Marine Aircraft Group 24. MCBH drives significant rental demand in Kailua and Kaneohe on the Windward (east) side of O’ahu.

Tripler Army Medical Center (Moanalua, central O’ahu): the pink six-story hospital known as the “Pink Palace of the Pacific,” Tripler is the largest military hospital west of the Mississippi. It is a Level I Trauma center serving approximately 100,000+ military beneficiaries across the Pacific theater, employs approximately 2,000+ military and civilian healthcare professionals, and trained Arthur Murray and many other notable figures during WWII operations.

BAH (Basic Allowance for Housing) impact: The Honolulu Military Housing Area is one of the highest BAH-rate areas in the United States. Approximate 2025 rates (with dependent rates shown):

• E-1 to E-4 with dependents: ~$2,100–$2,400/month
• E-5 with dependents: ~$2,900–$3,200/month
• E-7 with dependents: ~$3,200–$3,600/month
• O-3 with dependents: ~$3,900–$4,300/month
• O-5 with dependents: ~$4,400–$4,900/month

These BAH rates directly set a price floor for O’ahu rentals in the $2,400–$4,000 range. Landlords in Ewa Beach, Kapolei, Pearl City, Aiea, Halawa, Kaneohe, and Kailua consistently price 2BR and 3BR units at BAH-ceiling rates because military families — who receive housing allowances regardless of whether they live on or off base — represent reliable, creditworthy tenants with guaranteed income. The military rental cohort in greater Honolulu is estimated at 25,000–35,000 off-base households, representing approximately 15–20% of total O’ahu rental demand.

SCRA (Servicemembers Civil Relief Act) compliance: All Hawaii landlords with military tenants must understand SCRA (50 U.S.C. §3901 et seq.) obligations:

• Active-duty service members may terminate a lease with 30 days’ written notice after receiving PCS orders, activation orders, or deployment orders for 90+ days. The termination is effective 30 days after the next rent due date following notice.
• Landlords may not evict a service member or their dependents for non-payment of rent below $4,539.11/month (2024 threshold, adjusted annually) without a court order, even during active-duty periods.
• Interest rates on obligations incurred before military service must be reduced to 6% per annum during active-duty periods upon written request.
• For O’ahu landlords: PCS orders from JBPHH, Schofield, or MCBH are extremely common (typically every 2–3 years per service member assignment). A landlord who holds a 12-month lease with a military family has an above-average likelihood of receiving a PCS break request mid-lease. Plan lease terms and break clauses accordingly.

University of Hawaii System: 10 Campuses, Carnegie R1, NCI Cancer Center

The University of Hawaii System — a public university system created by the Hawaii State Legislature and governed by the Board of Regents — operates ten campuses across the state, enrolling approximately 50,000–55,000 students total and employing approximately 17,000–19,000 faculty, staff, and graduate assistants system-wide. The flagship campus, UH Manoa, is located in Manoa Valley, approximately 2.5 miles northeast of downtown Honolulu.

UH Manoa key facts:

• Designated Carnegie Research 1 (Doctoral Universities: Very High Research Activity)
• Approximately 18,000 students enrolled (undergraduate + graduate + professional)
• Approximately 5,000–6,000 direct faculty and staff
• Annual research expenditures: ~$400M+, including major oceanographic, astronomy, and tropical agriculture programs
• NCI-Designated Cancer Center: University of Hawaii Cancer Center (UHCC), designated by the National Cancer Institute, is the only NCI-designated cancer center in Hawaii and the broader Pacific region. The UHCC conducts research on cancers prevalent in Pacific Island populations including nasopharyngeal carcinoma and hepatocellular carcinoma.
• John A. Burns School of Medicine (JABSOM): the only MD-granting medical school in Hawaii; affiliated with The Queen’s Medical Center for clinical training; trains approximately 300 medical students and hundreds of residents and fellows who serve Hawaii and Pacific Island populations
• Institute for Astronomy (IfA): operates the Mauna Kea observatories complex (WM Keck Observatory, Subaru Telescope, IRTF, Gemini North) on the Big Island’s Mauna Kea summit; manages some of the world’s most powerful optical/infrared telescopes; ~300 scientists and staff

Rental market impact: UH Manoa’s location in Manoa Valley creates concentrated academic-year demand in the surrounding neighborhoods. Manoa Valley 1BR units (quiet, flood-prone but traditionally popular with graduate students) range from $1,400–$2,200. The adjacent Mo’ili’ili, Kaimuki, and Mānoa neighborhoods attract a mix of student, young-professional, and medical-resident renters. August and January (semester-start months) see the highest vacancy absorption in these areas. UH Manoa’s on-campus housing accommodates approximately 3,000 students, leaving ~15,000+ students seeking off-campus housing in and around Honolulu.

HMSA: Blue Cross Blue Shield Hawaii, ~700,000 Members (~50% of State Population)

Hawaii Medical Service Association (HMSA), Hawaii’s dominant health insurer and a licensee of the Blue Cross Blue Shield Association, is headquartered at 818 Keeaumoku Street, Honolulu. HMSA covers approximately 700,000–720,000 members — representing roughly 50% of Hawaii’s total population of approximately 1.4 million — making it the dominant insurer in the state by an extraordinary margin. HMSA employs approximately 3,500–4,500 people at its Honolulu headquarters and affiliated offices.

HMSA’s market dominance is inseparable from Hawaii’s unique Prepaid Health Care Act (PHCA, HRS Chapter 393, enacted 1974) — the same year as HRS Chapter 521. The PHCA requires employers to provide health coverage to all employees working 20+ hours per week for at least four consecutive weeks. This state law predates the Affordable Care Act by 36 years and creates near-universal employer-sponsored coverage in Hawaii. The PHCA cannot be preempted by federal ERISA for non-ERISA plans, and Hawaii received a specific ERISA exemption in 1983. HMSA and Kaiser Permanente Hawaii are the two dominant carriers serving the PHCA market.

HMSA’s large Honolulu administrative and operational workforce contributes to demand for 1BR and 2BR units in the Kakaako, Mo’ili’ili, and Kaimuki neighborhoods near the 818 Keeaumoku headquarters. HMSA is widely considered one of Hawaii’s most desirable employers — known for competitive pay, strong benefits (including PHCA-compliant healthcare), and employment stability. The healthcare administration sector broadly (HMSA + Kaiser + Aloha Care + smaller insurers) employs approximately 7,000–9,000 people statewide.

Queen’s Health System: Level I Trauma, Founded 1859 by Hawaiian Royalty

The Queen’s Medical Center at 1301 Punchbowl Street, Honolulu, is the oldest and largest private hospital in Hawaii, founded in 1859 by Queen Emma Kaleleona‘lani and King Kamehameha IV. Queen’s is designated a Level I Trauma Center and serves as the regional referral center for acute care across Hawaii and the Pacific Basin (including Guam, the Marshall Islands, American Samoa, and Micronesian island nations under the Compact of Free Association).

Queen’s Health System key facts:

• ~4,000–5,000 employees at Queen’s Medical Center Honolulu
• Queen’s Medical Center – West O’ahu (Ewa Beach): opened 2014; serves the rapidly-growing Ewa Plain / Kapolei corridor; ~500+ beds; strong employment demand in Ewa and Kapolei rental market
• Queen’s North Hawaii Community Hospital (Kamuela / Waimea, Big Island): critical access hospital
• Molokai General Hospital (Kaunakakai, Molokai): critical access hospital for island with no other acute care
• Total system employment: ~6,000–7,000
• Affiliation with JABSOM / UH Manoa for medical education
• Queen’s is a nonprofit organization under Hawaiian charter, consistent with its origin as a charitable institution of the Hawaiian Kingdom

Straub Medical Center (888 S. King Street, Honolulu; now part of Hawaii Pacific Health), The Kapiolani Medical Center for Women & Children (1319 Punahou Street, Honolulu), and Pali Momi Medical Center (Aiea) are the other major Honolulu private hospitals. Hawaii Pacific Health (HPH), the parent of Straub, Kapiolani, and Pali Momi, employs approximately 7,000–8,000 system-wide. Kuakini Medical Center (347 N Kuakini Street, Honolulu) serves as a smaller community hospital. Together, Hawaii’s private hospital systems employ approximately 20,000–25,000 in greater Honolulu.

Hawaiian Airlines / Alaska Air Group: Merger, Market, and Honolulu Employment

Hawaiian Airlines, founded in 1929 as Inter-Island Airways and headquartered at Daniel K. Inouye International Airport (HNL), Honolulu, was acquired by Alaska Airlines (Alaska Air Group, NYSE:ALK) in a transaction that closed September 18, 2024, following DOJ clearance (with negotiated conditions including service commitments on certain routes). The $1.9B acquisition created the 5th-largest US airline by combined fleet size. The Hawaiian Airlines brand was retained post-merger, with its distinctive purple livery, inter-island services (9 inter-island routes), and transpacific long-haul routes to Japan, South Korea, Australia, Tahiti, and mainland US cities preserved under the Hawaiian brand.

Pre-merger Hawaiian Airlines employment (Honolulu):

• ~6,700 total employees, predominantly based at HNL
• Roles: pilots (~1,200+), cabin crew (~2,000+), maintenance/MRO (~1,000+), ground operations, customer service, administration
• Hawaiian was the largest employer at HNL and one of the 5 largest private employers in Hawaii

Post-merger (2024–2026): The combined Alaska-Hawaiian operation at HNL maintains Hawaiian Airlines’ inter-island network (O’ahu – Maui, O’ahu – Big Island, O’ahu – Kauai, Maui – Big Island, Maui – Kauai inter-island hops). The transpacific long-haul fleet (A330-200, A321neo) was integrated into Alaska Air Group’s broader network planning. Employment levels at HNL declined somewhat from integration savings, with post-merger Honolulu employment estimated at 5,500–6,500. The merger represented a structural consolidation in Hawaii aviation and a significant change in the island’s aviation employment landscape.

HNL as employer hub: Beyond Hawaiian/Alaska Airlines, HNL hosts United Airlines, American Airlines, Delta Air Lines, Southwest Airlines, Japan Airlines (JAL), and All Nippon Airways (ANA) operations. Total airport-adjacent employment (airlines, cargo, ground handlers, TSA, CBP, concessions, rental cars) approaches 15,000–18,000 in greater Honolulu. The HNL airport area (Lagoon Drive corridor, Nimitz Highway) drives rental demand in Kalihi, Iwilei, and the Salt Lake neighborhood.

Matson Navigation: The Jones Act Carrier That Moves Hawaii’s Economy

Matson Navigation Company (a wholly-owned subsidiary of Matson, Inc., NASDAQ: MATX), headquartered at 1411 Sand Island Pkwy, Honolulu, is the only US-flag ocean carrier operating scheduled container shipping service to Hawaii under the Jones Act (Merchant Marine Act of 1920, 46 U.S.C. §55102). The Jones Act requires that cargo transported between US ports be carried exclusively on vessels that are: (1) built in the United States; (2) registered under the US flag; (3) owned by US citizens; and (4) crewed by US citizens and permanent residents.

For Hawaii — an island state with no land or rail connection to the continental US — the Jones Act means that virtually all food, building materials, automobiles, electronics, furniture, petroleum products, and other consumer goods transported from US mainland ports to Hawaiian ports must travel on Matson vessels (or, on certain routes, Pasha Hawaii vessels). This makes Matson structurally essential to Hawaii’s economy in a way that no single freight carrier is essential to any continental US state.

Matson key facts:

• NASDAQ: MATX; ~$3.2B+ annual revenue (FY2024); approximately $700M–$900M operating income in recent peak years
• Fleet: approximately 23 vessels serving Hawaii, Alaska, Guam, Micronesia, and transpacific China services
• Hawaii Hawaii route: Matson operates container ships from Long Beach (CA) and Oakland (CA) to Honolulu’s Pier 52 (Sand Island), with connections to Maui (Kahului), the Big Island (Hilo and Kawaihae), and Kauai (Nawiliwili) via feeder vessels
• Honolulu workforce: ~800–1,000 employees including maritime operations, logistics, technology (SNET, Matson’s supply chain visibility platform), and corporate functions
• Matson Logistics subsidiary: non-vessel operating common carrier and supply chain management serving mainland US markets
• GUAM & MICRONESIA: Matson is the dominant carrier to US-affiliated Pacific islands; Jones Act applies to CNMI (Commonwealth of the Northern Mariana Islands) and Guam under specific circumstances
• CHINA SERVICE: Matson operates fast, premium transpacific China-to-Long Beach container service (CLX/MAX service); competes with ocean shipping lines on speed (10–12 days vs. 20–25 days for standard services)
• Founded: 1882 as the Oceanic Steamship Company; renamed Matson Navigation Company 1901 after William Matson; Matson merged with Alexander & Baldwin 1969; A&B spun off Matson in 2012 as separate NYSE company

Jones Act housing implication: Because Matson controls the primary freight channel into Hawaii, all residential construction costs — lumber, steel, concrete, fixtures, appliances — are elevated by Jones Act transportation premiums. Estimates vary, but the Jones Act is estimated to add 15–25% to the cost of construction materials for Hawaii projects compared to mainland US comparable markets. This structurally inflates the cost of building new housing units, suppresses new housing supply, and contributes to Hawaii’s chronic housing undersupply and elevated rental prices. Landlords benefit from this supply constraint in the long run; renters bear the cost in elevated market rents.

Kamehameha Schools (Bishop Estate): ~365,000 Acres, $11B+ Endowment, Hawaii’s Largest Private Landowner

Kamehameha Schools — also known as the Bernice Pauahi Bishop Estate — is the largest private landowner in Hawaii, controlling approximately 365,000 acres of land across O’ahu, Maui, the Big Island, and Moloka’i. This represents approximately 9% of Hawaii’s total land area of approximately 4.1 million acres. Kamehameha Schools was established under the will of Princess Bernice Pauahi Bishop (1831–1884), the great-granddaughter of King Kamehameha I (the unifier of Hawaii), who bequeathed her vast land holdings to create schools for Native Hawaiian children.

Key facts:

• Endowment: ~$11B+ (FY2025 estimate) — among the largest private school endowments in the United States; larger than all Ivy League endowments except Harvard (~$53B), Yale (~$40B), Princeton (~$34B), and Penn (~$21B); comparable to MIT (~$24B) and Northwestern (~$14B)
• Schools: Kamehameha Schools campuses on O’ahu (Kapalama, Honolulu), Maui (Paia), and Big Island (Keaau); preference given to children with Hawaiian ancestry under original trust terms; approximately 6,500 PK-12 students across campuses; tuition-free for qualified students subsidized by endowment income
• Land portfolio: Kamehameha Schools’ land holdings include commercial properties in downtown Honolulu, Kakaako (including the entire Kakaako neighborhood being redeveloped as Honolulu’s “urban core”), agricultural lands in Maui, residential land across O’ahu, and undeveloped forest and agricultural parcels on multiple islands
• Kakaako Development: Kamehameha Schools is the master developer of Kakaako, Honolulu’s urban neighborhood between downtown and Waikiki, which is undergoing intensive condominium and mixed-use development (SALT at Our Kaka’ako, Wai Hong Kong, multiple luxury towers). This development activity directly affects the Kakaako rental market as new inventory enters
• Lahaina lands: Kamehameha Schools owned land in Lahaina, Maui, adjacent to the August 2023 fire zone. Post-wildfire, decisions about whether to sell, develop affordable housing, or preserve these lands became deeply contentious in the community. As of 2026, negotiations regarding Lahaina redevelopment continue to involve Kamehameha Schools as a key stakeholder
• Total employment: ~2,000–2,500 employees across schools and land management functions

James Campbell Company (Campbell Industrial Park, Ewa; former sugar plantation lands on O’ahu’s west coast; major industrial/commercial land trust) and Castle & Cooke Homes Hawaii (major residential developer) are other large Hawaii landowners with significant influence on Honolulu housing supply.

Bank of Hawaii and First Hawaiian Bank: Island Banking Anchors

Bank of Hawaii (NYSE: BOH), headquartered at 130 Merchant Street, Honolulu, is Hawaii’s oldest bank, founded in 1897 during the era of the Republic of Hawaii (before annexation to the United States in 1898). Bank of Hawaii operates approximately 55 branches across O’ahu, Maui, the Big Island, Kauai, Guam, and Palau. As of year-end 2024, Bank of Hawaii held approximately $22B–$24B in total assets, approximately $14B in loans and leases, and approximately $18B–$20B in total deposits. BOH employs approximately 2,100–2,300 people in Hawaii. BOH’s mortgage lending is a significant factor in the Honolulu housing market — as a major originator of jumbo residential mortgages in a high-cost housing market, BOH’s lending standards and mortgage products directly affect home purchase activity and, indirectly, the owner-renter balance in Hawaii neighborhoods.

First Hawaiian Bank (NASDAQ: FHB), headquartered at 999 Bishop Street, Honolulu, is the largest bank in Hawaii by deposit market share. Founded in 1858 as Bishop & Company (one year before Queen Emma founded The Queen’s Medical Center), First Hawaiian is the oldest company in Hawaii in continuous operation. As of year-end 2024, FHB held approximately $24B–$26B in total assets and approximately $20B–$22B in total deposits. FHB employs approximately 2,200–2,500 people across ~55 branches in Hawaii and ~3 in Guam and Palau. Together, Bank of Hawaii and First Hawaiian Bank control approximately 40–50% of Hawaii’s commercial banking deposit market, with the balance shared by Central Pacific Bank (NYSE: CPF, ~$7B assets), HomeStreet Bank, American Savings Bank, and national banks (Wells Fargo, Bank of America).

HART Skyline: $12.4B Rail System, 4 Stations Open in 2023, 21 Stations Total

The Honolulu Authority for Rapid Transportation (HART) is building the Skyline rail system — an elevated fixed-guideway rapid transit line that, when complete, will run 20 miles from East Kapolei (near Ko Olina) to the Ala Moana Center (adjacent to Waikiki) along O’ahu’s southern coast and through the primary employment corridor (Pearl Harbor area, downtown Honolulu). The first four stations (East Kapolei, Hoopili, West Loch, Waipahu Transit Center) opened June 30, 2023, beginning Skyline’s first revenue service. Additional stations are under construction as of 2026.

Skyline key facts:

• Total project budget: ~$12.4B (as of 2024 estimate) — the most expensive public works project in Hawaii history and one of the most expensive per-mile transit projects in the US
• Total route: 21 stations over ~20 miles, fully elevated (no at-grade crossings), automated driverless operation
• Route corridor: Ewa Plain (Kapolei/Ewa Beach) → Pearl City/Aiea → Waipahu → Pearl Harbor → Downtown Honolulu → Kakaako → Ala Moana Center (future phase)
• Completion timeline: Full 21-station system projected to reach downtown Honolulu in 2028–2030 per current HART schedules (subject to budget and construction delays)
• Ridership model: HART projects 40,000–70,000 daily riders once fully operational, reducing O’ahu’s chronic H-1 freeway congestion
• Funding: Hawaii state general excise tax (GET) surcharge (0.5% on O’ahu, generating ~$350M/year); federal New Starts grant (~$1.5B+); general obligation bonds

Rental market impact of Skyline: The TOD (transit-oriented development) corridor around Skyline stations has already attracted significant new condominium and apartment development, particularly in the Ewa Plain and Kakaako areas. Apartment projects marketed as “walk-to-Skyline” have opened or broken ground in the Hoopili, West Loch, and Kakaako station areas. Long-term, the Skyline corridor is expected to shift rental demand patterns away from the Honolulu urban core (where parking is scarce and expensive) toward the Ewa Plain (Kapolei, Ewa Beach, Hoopili), which offers relatively lower rents and is now connected to downtown Honolulu by rapid transit. Landlords in the Ewa corridor should anticipate continued demand growth as Skyline extends eastward.

Honolulu’s Bill 41 (Ordinance 21-7): The Platform STR Crackdown That Reshaped the LTR Market

Honolulu City and County Ordinance 21-7, passed by the Honolulu City Council in October 2021 and signed into law effective October 23, 2022, represents the most consequential housing policy change in Honolulu in a decade. Bill 41 fundamentally restructured Honolulu’s short-term vacation rental (STR) market through a novel platform-liability enforcement mechanism: rather than simply requiring STR operators to hold permits (Honolulu had tried this before without success), Bill 41 required all STR booking platforms (Airbnb, VRBO, HomeAway, Booking.com, and similar services) to verify each listed property’s permit status before publishing the listing and to comply with monthly reporting requirements to the City & County.

Pre-Bill 41 status: Honolulu had long had STR permit requirements (Non-Hosted Vacation Unit permits in resort-zoned districts; similar structures in residential zones), but enforcement was spotty. Prior to October 2022, an estimated 10,000–16,000 STR units were listed on Airbnb/VRBO in Honolulu, the vast majority (estimates suggest 8,000–12,000) operating without valid permits in residential zoning districts where STRs were already technically prohibited under prior zoning rules.

Bill 41 mechanism: By requiring the platforms themselves to verify permit status and prohibiting them from processing bookings for unpermitted properties, Bill 41 effectively defunded thousands of illegal STR operations. Unlike prior enforcement approaches that required the city to identify and cite each individual illegal operator, platform compliance meant the city could achieve enforcement at scale by requiring Airbnb and VRBO to remove unpermitted listings. The penalty structure for platforms was significant: Honolulu could assess fines against platforms for each transaction processed for an unpermitted listing.

Observed effects (2022–2025):

• Airbnb listings in Honolulu fell by an estimated 35–55% from peak pre-Bill-41 levels by early 2023, as illegal operators either obtained permits (in resort zones only) or ceased operating
• An estimated 6,000–8,000 units previously in the STR market converted to long-term rentals (LTR) — either voluntarily by owners who chose LTR over the compliance burden, or involuntarily as platforms delisted non-compliant properties
• O’ahu apartment vacancy rates, which had been as low as 1.0–1.5% in 2021–2022, rose to approximately 3.0–5.0% by 2024 — a meaningful improvement in housing availability
• Honolulu’s year-over-year rent growth, which had been running at 8–12% annually in 2021–2022, moderated to 2–4% in 2023–2024, partially attributable to the new LTR supply
• Resort-zoned STR inventory (Waikiki) was largely unaffected, as Waikiki operators held valid resort-zone permits

For landlords in 2026: If you own a residential property in Honolulu outside resort zoning (any property in A-1, A-2, A-3, B-1, B-2, or R zoning districts), STR operation is effectively prohibited under Bill 41 enforcement. Listing on Airbnb, VRBO, or similar platforms in non-resort zoning is likely to result in listing removal by the platform and potential fines. Long-term residential leasing is the lawful use. Verify your property’s zoning category through the Honolulu Department of Planning and Permitting (DPP) ZoneCheck tool or permit inquiry before advertising any STR use.

Maui Wildfire 2023: Lahaina, 102 Deaths, and the Housing Emergency That Followed

On August 8, 2023, driven by dry conditions and powerful Kona winds (Hurricane Dora-generated), a wildfire ignited in and around Lahaina on the northwest shore of Maui. The fire moved with extraordinary speed through the dense, historic town of Lahaina — a former capital of the Hawaiian Kingdom and a National Historic Landmark district — destroying approximately 2,200 structures, killing at least 102 people, and displacing an estimated 10,000–12,000 residents. The Lahaina fire was the deadliest US wildfire since the 1918 Cloquet, Minnesota fire (approximately 400 deaths) — more deadly than the 2018 Camp Fire (Paradise, California, 85 deaths), the 2017 Tubbs Fire (22 deaths), and the 2020 Creek Fire (0 deaths but 882 structures).

Lahaina housing context: Pre-fire, Lahaina was a densely populated, majority-renter community. The Front Street corridor and surrounding neighborhood housed thousands of long-term residents — hotel workers, restaurant employees, retail workers serving West Maui’s tourist economy — many of whom paid $1,500–$2,500/month for older, small apartments in a market where comparable units in Kihei or Kahului rented for $1,800–$2,800. A significant proportion of Lahaina’s rental housing was older stock: plantation-era cottages, mid-century apartments, and multi-family structures not built to current fire-resistance codes.

Immediate rental market response:

• West Maui STR to emergency housing: Maui County Mayor Bissen declared a state of emergency, and the state Governor’s emergency order prohibited price-gouging in rental housing in Maui County (the order limited rent increases to 10% above pre-disaster prices during the emergency period). Hundreds of West Maui vacation rental owners were contacted by the county and requested to rent units to displaced residents at capped rates.
• Rent surge in non-fire areas: Kihei (south Maui), Kahului (central Maui), Wailuku (central Maui), and Makawao (upcountry Maui) experienced acute demand from displaced Lahaina residents. 2BR units in Kihei that had rented for $2,000–$2,400 in July 2023 were being listed at $2,800–$3,500 within 60 days of the fire — a 30–45% increase that represented genuine post-disaster price pressure, not ordinary market appreciation.
• FEMA housing assistance: FEMA’s Transitional Sheltering Assistance (TSA) program placed hundreds of displaced Maui households in hotels at government expense through 2023–2024. Extended TSA assistance ran through mid-2025 for some households.
• Lahaina rebuild timeline: As of 2026, Lahaina’s full rebuild is estimated to be at least 5–10 years. Clean-up of the toxic ash (containing asbestos, lead paint debris, and contaminated soil) was largely completed by mid-2024. Zoning reviews, infrastructure replacement, and community planning processes are ongoing. The Lahaina rental housing stock may permanently contract from its pre-fire levels if large-lot consolidation, commercial redevelopment, or reduced affordable housing reconstruction occurs.

For Maui County landlords in 2026: Maui County emergency proclamations issued in connection with the wildfire have been modified over time, but certain provisions — particularly those related to anti-displacement protections in the affected areas of West Maui (Lahaina Town Council area) — may still be in effect. Landlords with units in the Lahaina, Ka‘anapali, or Napili-Honokowai areas should review current Maui County proclamations for any applicable rent-increase restrictions, eviction moratorium provisions, or tenant relocation assistance requirements before taking adverse action against tenants. Contact the Maui County Office of the Mayor or the State of Hawaii’s Department of Commerce and Consumer Affairs (DCCA) for current guidance.

Honolulu Neighborhood Rental Market Table (2-Bedroom, 2026)

Neighborhood / Area	2BR Range (2026)	Notes
Waikiki / Diamond Head	$2,400–$4,500	Resort zone; condo-heavy; short-walk-to-beach premium; ocean-view units $4,000+
Kakaako / Ala Moana	$2,800–$4,200	New luxury towers; Ward Village (Kamehameha Schools master plan); urban amenities
Downtown / Chinatown	$1,900–$2,900	Mixed older/newer stock; arts district; near HART Skyline Civic Center station
Manoa / Mānoa Valley	$1,800–$3,000	Near UH Manoa; academic-year demand; flood zone; some houses with ohana units
Mo’ili’ili / Kaimuki	$1,900–$2,800	Restaurant corridor; young professional demand; near both UH and HMSA
Pearl City / Aiea / Halawa	$1,700–$2,400	Near Pearl Harbor / JBPHH; BAH-floor pricing; 1970s–80s suburban stock
Ewa Beach / Ewa Plain / Hoopili	$1,700–$2,400	New construction corridor; HART Skyline accessible; growing Kapolei employment hub
Kailua / Kaneohe (Windward)	$2,100–$3,200	Near MCBH; windward-side premium; beach access; historically tight vacancy

Honolulu Rent Trajectory (2-Bedroom, 2019–2026F)

Year	Avg. 2BR Range	Key Driver
2019	$1,700–$2,100	Pre-COVID; tourism peak; low vacancy; steady military BAH floor
2020	$1,600–$2,000	COVID tourism collapse (arrival dropped 74% YOY); modest rent softening; CARES Act moratorium
2021	$1,750–$2,200	Remote-work migration surge; mainland arrivals up; vacancy tightened sharply
2022	$2,000–$2,600	Pandemic demand peak; Honolulu among fastest-rising US markets; Bill 41 enacted (Oct)
2023	$2,100–$2,700	Bill 41 effective (Oct 2022): LTR supply begins rising; rate of rent growth slows
2024	$2,100–$2,700	Flat YOY; vacancy improved 3%+; Hawaiian Airlines merger (Sept 2024); Skyline extension
2026F	$2,200–$2,900	Modest appreciation; BAH rates raise floor; Skyline TOD drives Ewa demand; no rent control

Pacific-Region Deposit Law Comparison (8 States)

State	Deposit Cap	Return Deadline	Interest Required	Penalty
Hawaii	1 month	14 days	YES — 5% per annum	3× treble damages
California	1 month (unfurnished); 2 months (furnished)	21 days	No	2× actual + punitive
Oregon	No statutory cap	31 days	No	2× withheld amount
Washington	No statutory cap	21 days (statement); 30 days (deposit)	No (except Seattle)	2× withheld amount
Nevada	3 months	30 days	No	2× withheld amount
Arizona	1.5 months (nonrefundable: total of all deposits/fees limited)	14 days	No	2× withheld amount
Alaska	2 months (except for seasonal or some other leases)	14 days	No	Actual damages + atty fees
Colorado	No statutory cap (for most residential units)	30 days	No	3× withheld (if bad faith)

8-City Rental Market Comparison (2-Bedroom, 2026)

City	Avg. 2BR (2026)	Rent Control?	Deposit Return	Deposit Interest
Honolulu, HI	$2,200–$2,900	No	14 days	5% per annum required
Seattle, WA	$2,100–$2,900	No (state preempts)	21–30 days	No (Seattle: 3% on some)
San Diego, CA	$2,400–$3,400	Yes (AB 1482 + local RSO)	21 days	No
Portland, OR	$1,600–$2,200	No (OR preempts); relocation fee req.	31 days	No
Las Vegas, NV	$1,500–$2,000	No	30 days	No
Phoenix, AZ	$1,300–$1,800	No (ARS preempts)	14 days	No
Denver, CO	$1,600–$2,200	No (state preempts)	30 days	No
Anchorage, AK	$1,200–$1,700	No	14 days	No

8-Step Hawaii Landlord Compliance Checklist for 2026

1. Deposit amount: Collect no more than one month’s rent as a security deposit (HRS §521-44(b)). Last-month’s-rent deposits count against this cap. If also collecting a non-refundable fee (e.g., pet fee), verify it is clearly labeled non-refundable in the lease and does not exceed applicable limits.
2. Interest-bearing account: Hold the security deposit in an account capable of earning or crediting 5% per annum interest (HRS §521-44(d)). Maintain records of the deposit receipt date and amount. At move-out, calculate 5% per annum from receipt date to vacation date and pay or credit this interest to the tenant alongside the deposit return.
3. Written deposit receipt: Provide the tenant a written receipt acknowledging the security deposit within a reasonable time of receipt. Note the amount, account where held, and the date received. Hawaii law does not specify a strict receipt deadline, but best practice is 5 business days.
4. 5-day pay-or-quit notice: Before filing any eviction (summary possession) action for non-payment of rent, serve a proper written 5-day demand (HRS §521-68(a)) by personal delivery or first-class mail. Keep a dated copy and proof of delivery. No court will accept a summary possession filing without proof of prior proper notice.
5. 14-day deposit return: After the tenant vacates AND provides a written forwarding address, return the full deposit (with 5% interest computed to the vacation date) OR mail a written itemized deduction statement and any remaining deposit amount within exactly 14 calendar days (HRS §521-44(c)). Failure to meet this deadline — even by one day — automatically triggers the 3× treble damages exposure.
6. 5% deposit interest calculation: Calculate interest as: (deposit amount) × 0.05 × (days held ÷ 365). For a $2,000 deposit held 400 days: $2,000 × 0.05 × (400/365) = $109.59 in mandatory interest. Include this amount with the deposit return check or clearly credit it in the itemized statement.
7. Honolulu permit compliance: If renting a residential unit in Honolulu City & County, verify you hold a current Residential Landlord-Tenant Permit (rental registration) from the Honolulu Department of Planning and Permitting (DPP). Confirm your property’s zoning designation — in non-resort zoning districts (A-1, A-2, A-3, B-1, B-2, R), STR operation is prohibited under Bill 41; advertise and operate as long-term rental only.
8. SCRA review for military tenants: For tenants with Joint Base Pearl Harbor-Hickam, Schofield Barracks, MCBH Kaneohe Bay, Tripler, or other military connections, review SCRA obligations (50 U.S.C. §3901 et seq.). Accept PCS / deployment lease-break notices as required; do not deny or penalize service members for exercising SCRA break-lease rights. Failure to comply with SCRA creates federal liability including civil penalties and possible criminal prosecution.

Frequently Asked Questions