Honolulu Unites Maui, Waikīkī, Kauai, and Kona Across US to Face New Luxury Tourism Crisis Plunging Economy Down and Bringing Wrath and Jeopardy on Travellers and Locals Alike: Reports Reveal

Hawai’i’s luxury resort overcharge crisis has deepened in 2024 and 2025, as soaring hotel rates and skyrocketing resort fees push local residents out of their own paradise. Cities like Honolulu, Maui, Waikīkī, Kauai, and Kona have become playgrounds for the rich, with average daily room rates (ADRs) climbing to record highs. Visitors, while paying exorbitant rates for a slice of paradise, are also fueling an affordable housing crisis, as vacation rentals and expensive resorts claim the island’s limited land, leaving locals struggling to find affordable housing. Efforts to regulate these rising costs have met resistance from the tourism industry, leading to ongoing debates about how tourism is affecting local communities. As property prices continue to rise, Hawaiian lawmakers are pushing for new measures to ensure that residents aren’t displaced by the luxury resort market. The tension between preserving local culture and maximizing profits has made Hawai’i a battleground for economic justice, driving locals to demand change.
Hawai‘i’s tourism‑driven economy has always depended on visitors willing to pay for the chance to experience the islands’ beaches, culture and climate. In recent years, however, the cost of visiting – and of living alongside this industry – has climbed sharply. Average daily room rates (ADRs) have surged, resort fees and taxes have multiplied, and housing shortages have intensified. Combined with record hotel revenues, these changes have fed a perception that Hawai‘i is becoming a playground for wealthy tourists, leaving local residents priced out of their homeland. The phenomenon is often described as a “luxury resort overcharge,” and throughout 2024 and 2025 it became a flashpoint in debates about tourism, housing, environmental stewardship and economic justice across Honolulu, Waikīkī, Maui, Kaua‘i and Kona.
This article synthesises real‑world data from those two years, highlighting key incidents, legislative changes and community responses. It draws on government reports, advocacy surveys, news stories and academic studies to explain why the high price of paradise is provoking a backlash among residents and even visitors. The narrative shows how the islands’ hospitality industry is being asked to shoulder a greater burden for infrastructure and climate resilience, how luxury rates and fees have sparked viral anger, and how locals are increasingly considering leaving Hawai‘i because they can no longer afford to live there.
Rising Room Rates and Luxury Pricing
Hotels charge record nightly rates
Hawai‘i’s hotels posted record average daily rates (ADRs) in 2024 and 2025, signalling strong demand and a willingness among visitors to pay high prices. According to the Hawai‘i Tourism Authority (HTA), the statewide ADR in June 2024 was US $373, with occupancy around 75.5 %[1]. The Wailea luxury area on Maui charged an ADR of $811 with occupancy of 61.6 %, while Kaua‘i hotels averaged $459 with 75.3 % occupancy[2]. The island of Hawai‘i (Kona) recorded an ADR of $424 and occupancy of 67 %, O‘ahu recorded $296 and 85.2 %, and Waikīkī hotels averaged $281 with 85.9 % occupancy[2].
By the end of 2024 the numbers climbed higher. The December 2024 hotel report showed a statewide ADR of $365 (occupancy 73.3 %). Maui’s Wailea region averaged an astounding $1,054 per night with occupancy 69.6 %[3]. Kaua‘i’s ADR stood at $455, Kona at $538, O‘ahu at $323 and Waikīkī at $307, with statewide revenue per available room (RevPAR) reaching $267[4]. The report estimated $5.5 billion in total hotel revenues for 2024, underscoring how lucrative the industry had become[3].
The pattern continued into 2025. The July 2025 report noted a statewide ADR of $386 and occupancy of 77.1 %, while luxury‑class hotels averaged a staggering $896 per night[5]. Wailea’s ADR remained high at $777 with 76 % occupancy; Kaua‘i averaged $444 with 77.4 % occupancy; Kona $446 with 68.3 % occupancy; O‘ahu $307 and Waikīkī $286 with occupancy near 84.8 %[6]. These numbers reflect a tourism industry that successfully commands premium prices even after the pandemic. While high ADRs translate into tax revenue and jobs, they also feed the narrative that Hawai‘i is catering to wealthy visitors at the expense of locals.
The resort fee controversy
High room rates are just one part of the pricing issue. Resort fees – mandatory daily charges tacked onto hotel bills for amenities like internet, gym access or beach chairs – became a lightning rod in 2025. A Beat of Hawai‘i article captured public outrage when a honeymooning couple at Waikīkī’s Royal Hawaiian hotel shared a bill showing more than US $500 in resort fees over their stay[7]. The story highlighted how resort fees across the state typically run US $50‑60 per night, with examples like $52 at the Royal Hawaiian, $61 at Sheraton Waikīkī, $59 at Hilton Hawaiian Village and $47 at Outrigger Waikīkī. Maui properties like the Grand Wailea and Wailea Beach Resort charge $53‑55 per night[7]. A weeklong stay can therefore add more than US $400 in fees, and some hotels also charge daily parking fees of $50 or more. Although the U.S. Federal Trade Commission requires fees to be disclosed up front, visitors still feel misled and used. Critics argue that resort fees are essentially a second room rate and contribute to the perception of price gouging[8].
Complaints about resort fees reflect a broader dissatisfaction with the cost of a Hawai‘i vacation. Visitor surveys discussed later in this article show that many travelers now view the islands as too expensive and poor value relative to other destinations. This discontent, combined with high housing costs for residents, fuels the argument that tourism is enriching hotel owners while residents shoulder the costs.
Housing Crisis and Resident Flight
Housing affordability plunges across the islands
Hawai‘i’s housing crisis predated the pandemic, but the 2024‑2025 period saw the situation worsen. The University of Hawai‘i Economic Research Organization (UHERO) housing factbook released in May 2025 declared that three‑quarters of Hawai‘i households are unable to afford a median‑priced home[9]. The median price for a single‑family home reached US $950,000 in 2024, up 6 % from 2023[10]. Condominium prices averaged $600,000 – down slightly because high insurance costs pushed some units into distress sales, but fees for condo associations increased by an average of $135 per month for nearly 40 % of the 1,680 condos tracked[11]. The report warned that Hawai‘i’s housing stock is among the oldest in the country and that replacing aging buildings will only become more expensive unless density is increased[12].
The factbook also addressed the vacation rental issue. About 34,000 short‑term rentals operate statewide, representing 6 % of all housing but an outsized share on the neighbor islands[13]. Nearly one‑third of these units are on Maui, and in Princeville on Kaua‘i they make up 80 % of the housing stock[14]. This concentration reduces the long‑term housing supply and inflates prices. The report noted that proposals to convert 6,000 vacation rentals to long‑term housing and build 2,000 workforce units were stalled by political opposition[15]. Meanwhile, new housing units are coming online at the slowest rate in 80 years, causing the median age of a house to climb from 39 years in 2018 to 44 years in 2023[16]. These structural factors mean even moderate increases in supply will take years to affect affordability.
Residents consider leaving en masse
Mounting evidence shows that high living costs are pushing residents to leave. The Holomua Collective’s 2025 Affordability Survey, which questioned 3,241 local workers, found that 75 % said they would relocate or were unsure if they would stay in Hawai‘i – up from 70 % in 2024[17]. The survey warned that more respondents were living paycheck to paycheck and spending unsustainable portions of their income on housing and transportation[18]. Although 63 % of respondents were lifetime residents[19], many felt trapped: 44 % did not know when they might leave, 33 % planned to move within five years, and 8 % within one year[20]. When asked what changes would keep them in Hawai‘i, top responses were wages matching the cost of living (26 %), basic needs and economic stability (24 %), housing affordability (24 %) and political or legislative actions (14 %)[21]. Comments from respondents included pleas to “stop investors from buying up all the properties,” reduce energy costs and provide long‑term affordable leases[22].
A Hawaii News Now report in January 2025 amplified these concerns. It cited an Aloha United Way analysis showing that one in three Hawai‘i households considered moving away in the previous year[23]. The report estimated that 180,000 people (roughly half a million residents) were barely scraping by and contemplating relocation[24]. It warned that the departure of working families would create a “hollow community” in which only the very rich or very poor remained[25]. The high cost of living and lack of affordable housing led to a situation where 58 % of Native Hawaiians and 52 % of Filipinos lived below the ALICE (Asset Limited, Income Constrained, Employed) threshold[26]. Bank of Hawaii CEO Peter Ho said bluntly, “Unless we come up with disruptive policies that drive down the cost of living, these people are going to leave”[27].
These reports underscore the scale of out‑migration pressure. While some local families have moved to the continental U.S. (often to Las Vegas or the Pacific Northwest), others remain but are stretched to the breaking point by high rents, food costs and taxes. In 2023 (slightly outside our timeframe), CBS News reported that roughly 15,000 native Hawaiians leave the islands each year, heading to states with lower costs and better job prospects; though older, this statistic provides additional context for a trend that continued into 2024 and 2025[28].
Resident sentiment on tourism
The tourism industry’s impact on residents was captured by the 2024 Resident Sentiment Survey, summarised in the UHERO report “Tourism in Hawai‘i: Industry Views and Stakeholder Comparisons” (September 2025). The survey found that only 56 % of residents felt tourism brought more benefits than problems[29], and 48 % said tourism was being better managed on their island. While a large majority recognised that tourism generates jobs (79 %) and supports local businesses (80 %), strong majorities also cited negative impacts: 75 % said tourism increases the cost of living, 70 % said it causes environmental damage, 69 % felt it led to disrespect for culture and ‘āina, and 65 % identified overcrowding[30]. These concerns were reflected across islands, with only 34 % of residents in Wai‘anae (O‘ahu) believing tourism’s benefits outweigh its problems[31].
Visitors notice the high cost, too. Among U.S. West visitors who said they were unlikely to return, 57 % cited Hawai‘i as “too expensive” and 29 % said it offered poor value[32]. These perceptions were even stronger among Japanese (67 % said it’s too expensive), Canadian (62 %) and European (55 %) visitors[32]. Industry leaders interviewed by UHERO acknowledged that costs were misaligned with the visitor experience and that labour shortages due to high living costs threatened service quality[33]. This combination of local and visitor dissatisfaction signaled that the islands could lose their appeal if costs continue to climb.
Legislative Responses and Economic Trade‑offs
Maui’s Bill 9 and the phase‑out of short‑term rentals
Nowhere were tensions over tourism and housing more pronounced than on Maui. In May 2024 Mayor Richard Bissen introduced Bill 9, a proposal to phase out thousands of short‑term vacation rentals (STRs) in apartment‑zoned districts. By mid‑2025 the bill had become the subject of fierce community debate. During a June 2025 hearing, Maui County’s Committee on Housing and Land Use heard more than five hours of testimony from residents divided over the measure[34]. Supporters argued that converting STRs into long‑term rentals was essential to alleviate the island’s housing crisis. They noted that new construction was hampered by water shortages and that using existing units offered the quickest path to increasing housing supply[35]. Teacher Shane Albritton testified that his students felt hopeless about affording a life on Maui, saying they “really don’t feel like they have a chance” to stay[36]. Shannon Iʻi, a survivor of the Lahaina fires, lamented that communities were being “carved out for outside gain” while locals fought for scraps[37].
Opponents of Bill 9 warned that a phase‑out would hurt workers and businesses dependent on tourism. They argued that high maintenance and insurance costs meant many STR units could not be rented long term at rates local families could afford[38]. Maui Vacation Rental Association director Caitlin Miller insisted the bill would not guarantee any conversion to affordable housing and that local working families — cleaners, property managers and contractors — would be the ones harmed[39].
The debate drew data from an UHERO economic impact study released in April 2025. The study projected that phasing out Maui’s STRs would increase long‑term housing by roughly 6,000 units — equivalent to 10 years of development at current rates[40]. However, it warned the proposal could reduce visitor spending by nearly US $900 million annually and cost about 1,900 jobs[41]. It also estimated a 25 % drop in condo prices and noted that 85 % of Maui’s transient vacation rentals are owned by out‑of‑state investors[42]. The county would face property tax revenue losses up to US $60 million annually and a decline of US $15 million in excise and transient accommodations taxes[43]. Notably, Maui County has about 15,000 STRs — 20 % of its housing stock — with the highest concentration in South Maui (50 % of housing) and West Maui (34 %)[44]. UHERO researchers stressed that doing nothing also carries costs, as rising rents and housing prices are forcing residents to leave[45].
Mayor Bissen acknowledged the economic trade‑offs but argued that housing is a basic human need. He said that when residents become “outsiders in their own neighborhoods,” leaders have a moral obligation to act[46]. His spokesperson emphasised that the phase‑out was pro‑resident, not anti‑tourism, and noted that revenue from STRs disproportionately benefits out‑of‑state investors while local infrastructure and community cohesion suffer[47]. As of late 2025 the bill had yet to be enacted, illustrating the delicate balance between housing affordability and tourism‑dependent livelihoods.
Honolulu and Waikīkī – debates over property taxes and empty homes
On O‘ahu, debates about tourism and housing revolved around property taxes and the proliferation of empty investment properties. Honolulu officials proposed increasing property taxes on short‑term rentals to encourage owners to rent long term, and there were discussions of an empty homes tax. Civil Beat reported that vacant or rarely used homes drive up prices and reduce the supply for residents. An analysis of Honolulu’s housing market noted that converting 6,000 vacation rentals to long‑term housing would help, but the proposal faced pushback from the real‑estate industry and some residents who rely on rental income[15]. The city also introduced a 90‑day minimum rental term starting September 2025 to curb illegal short‑term rentals, but enforcement proved challenging.
Waikīkī, the tourism epicenter of Honolulu, epitomizes the luxury overcharge problem. The area’s ADR in July 2025 was US $286 — lower than Maui’s but still high — with occupancy at 84.8 %[6]. Many locals have long since left the district; those who remain live in expensive high‑rise condos or older apartment buildings dwarfed by luxury hotels. The resort fee controversy mentioned earlier hit Waikīkī particularly hard because of the sheer volume of visitors and the presence of large resort brands charging daily fees over $50[7].
Kaua‘i – vacation rentals dominate Princeville
Kaua‘i has the smallest population of the major islands but faces some of the most extreme tourism pressures. According to UHERO’s housing factbook, 80 % of the housing stock in the resort town of Princeville is devoted to vacation rentals[14]. County officials and residents have debated imposing stricter regulations or higher taxes on these units. At the same time, Kaua‘i’s ADR in July 2025 was US $444 with 77.4 % occupancy[6], and the island’s natural attractions draw high‑spending visitors who often stay at luxury resorts along the north shore. Housing for workers, however, is scarce and expensive, forcing many to commute from other parts of the island or share crowded living conditions.
Kona and Hawai‘i island – relative bargains and the cost of living
The Big Island (Hawai‘i island) offers the most affordable housing among the major islands, with median home prices under $500,000 in districts like Puna and Ka‘ū[48]. Even so, the island’s ADR in July 2025 stood at US $446 with 68.3 % occupancy[6]. Tourism is concentrated in the Kona district, where luxury resorts line the Kohala Coast. While the Big Island’s housing costs are lower than O‘ahu’s or Maui’s, wages are also lower and the cost of goods (fuel, food, utilities) is high because everything must be shipped. The island’s relative affordability has attracted new residents from O‘ahu and Maui, leading to rising prices and local concerns about gentrification.
Environmental Fees and the Green Fee Debate
Introducing the Green Fee
The 2023 Lahaina wildfire disaster and the broader threat of climate change prompted Hawai‘i lawmakers to seek ways to fund environmental protection and climate resilience. In May 2025 the Legislature passed Senate Bill 1396, which Governor Josh Green signed into law as Act 96 on June 2 2025. The measure, nicknamed the “Green Fee,” adds a 0.75 % surcharge to the state’s existing transient accommodations tax and applies to hotel guests, vacation rentals and cruise ship passengers. According to the governor’s office, the fee will raise around US $100 million annually for environmental stewardship, climate resilience and wildfire recovery[49]. It is widely seen as the first climate impact fee in the United States.
A Civil Beat article explained that the fee will be collected in 2026 and will help fund hazard mitigation, reef restoration and other climate‑related projects[50]. A Beat of Hawai‘i commentary compared Hawai‘i’s fee to similar charges in destinations like Bali, Greece and New Zealand, noting that travelers generally support environmental fees if they see tangible benefits like trail maintenance and reef protection[51]. However, the article cautioned that travelers may resent the surcharge if funds are not transparently managed[52]. Critics also argue that adding yet another tax to already high room rates and resort fees could deter budget‑conscious visitors.
Long‑standing debate over taxing tourists
Arguments over taxing visitors are not new. Civil Beat’s historical analysis recounted nearly a century of proposals to levy head taxes or daily fees on tourists, often met with intense opposition from the hotel industry and concerns that such taxes would tarnish Hawai‘i’s “aloha spirit”[53]. In the 1960s and 1970s, Honolulu Mayor Frank Fasi made taxing tourists his political mission but faced strong pushback[54]. The modern Green Fee is the latest iteration of this long fight, but it differs by earmarking revenue for climate mitigation and wildfire recovery—needs that have become more urgent after climate‑driven disasters.
While many residents support making visitors contribute more to environmental protection, others worry that surcharges combined with high room rates and resort fees will push visitors to other destinations. Policymakers must balance the need for funding with the risk of accelerating tourism decline.
The Cultural and Social Toll
Locals feel like strangers in their homeland
Beyond economics, the luxury resort overcharge has a deep cultural impact. Many Native Hawaiians and long‑time residents feel that tourism has eroded their connection to the land (‘āina) and commodified their culture. The Holomua survey captured comments from participants who said they were “tired of watching our communities get carved out for outside gain”[37]. They lamented that investors buy up properties, drive up prices and displace multigenerational families. Another respondent said, “As of now, I’m basically just trying to save enough money to afford the move off of Hawaii. Zero change in over a decade when it comes to the housing crisis and wage disparity”[55].
The 2024 Resident Sentiment Survey also noted that only 43 % of residents believed tourism helps perpetuate Hawaiian culture, while 69 % said visitors often show disrespect for culture and land[30]. There is growing resentment that cultural sites and traditions are packaged for tourist consumption without proper respect or benefits for the host communities. Meanwhile, many residents working in the hospitality industry earn modest wages and struggle to pay rent or buy homes near their workplaces, leading to long commutes and even homelessness.
Visitors feel the cost is too high
Even tourists are beginning to push back. The UHERO visitor survey shows that high prices are a major deterrent to return visits. More than half of Japanese visitors who do not plan to return cite cost as the reason[32]. Viral social‑media posts about $8‑9 gallons of milk or $20 plate lunches underscore how everyday costs in Hawai‘i shock visitors. Beat of Hawai‘i documented letters from travelers outraged at resort fees and surcharges, some vowing never to return[7]. This backlash suggests that the state’s reputation for hospitality could suffer if visitors feel exploited.
Toward an Equitable Path Forward
The crises of high hotel rates, resort fees, vacation rentals, housing shortages, and resident flight are interconnected. They reflect the tension between an economy heavily reliant on tourism and a population struggling with the cost of living. Policymakers and community leaders across Honolulu, Maui, Waikīkī, Kaua‘i and Kona are grappling with how to rebalance this relationship. Potential solutions include:
- Converting short‑term rentals to long‑term housing: Maui’s Bill 9 represents one approach. UHERO’s analysis suggests that phasing out STRs could produce 6,000 additional housing units but would reduce visitor spending and jobs[41]. County officials propose tax adjustments to offset revenue losses[46]. A more moderate option might involve auctioning STR licenses or raising property taxes on vacation rentals to encourage long‑term leases[56].
- Building more affordable housing: The UHERO factbook points to plans to build 10,000 public housing units by 2026 and 2,000 workforce units, but these efforts face political hurdles[15]. The state could expedite zoning reforms and streamline permitting to increase density and lower costs. Honolulu’s plan to build housing around rail stations is one example[57].
- Implementing empty homes taxes: Honolulu and other counties are considering property tax surcharges on vacant homes and absentee owners to encourage sales or rentals to local residents. Civil Beat suggested that such taxes could motivate investors to put units on the long‑term market[15].
- Increasing wages and social support: Survey respondents repeatedly called for wages that match Hawai‘i’s high cost of living[21]. Expanding tax credits, reducing regressive fees, and investing in childcare and healthcare could help families stay.
- Ensuring transparency and accountability: Whether it is resort fees or the new Green Fee, travelers and residents want assurances that revenues are used for the stated purposes. Clear reporting on how funds from the Green Fee are spent — on wildfire recovery, reef restoration or other projects — will build trust and support[52].
- Diversifying the economy: UHERO and industry leaders recognise that Hawai‘i’s overreliance on tourism makes the state vulnerable. Investment in technology, agriculture, renewable energy and other sectors could create high‑paying jobs and reduce the pressure on tourism to generate revenue[33].