The County of Maui Recently updated its laws regarding accessory dwellings. For those that don’t speak zoning, the term accessory dwellings refers to cottages or attached apartments. Locally, we refer to these structures as ohanas. With the island feeling the pinch of a housing shortage, the county council recently voted to remove the limit on minimum lot sizes for ohanas. The new zoning laws also allow for a second ohana unit on certain size lots. The change in laws increased the size limits for ohanas, and it also allows for larger deck spaces. The last significant change is a prohibition on accessory dwellings for use as a bed and breakfast home, short-term rental home or a transient vacation rental. The intent of all of this legislation is to address the shortage of long term rentals on island.

Accesory Dwellings on Smaller Lots

Previously, a lot had to be 7,500 square feet or larger to legally have an ohana. The new rules stipulate that any property may have an accessory dwelling. That said, smaller properties would still need to have sufficient space for off street parking to get a permit for an accessory dwelling.

Two Accessory Dwellings are now Allowed on Lots that are 7,500 Square Feet or Larger.

Lots that are 7,500 square feet or above have always allowed for ohanas. They are now allowed a second ohana on the property. As with the smaller lots, the stipulation is that any additional ohana also has sufficient off street parking.

New Size Limits for Accessory Dwellings

The county has increased the size of the ohana units allowed on a property. The table below shows the new size limits based on lot size.

Lot Area in Square Feet	Maximum Gross Covered Floor Area (sq. ft)
Up to 7,499	500
7,500 to 9,999	600
10,000 to 21,799	720
21,780 to 43,599	840
43,560 to 87,119	960
87,120 or more	1,200

It is notable that these numbers are per “ohana” and not the total for the two structures. Covered floor area includes “any covered storage; excludes carports, parking spaces, and garages (including areas therein that contain laundry facilities and utility equipment such as water heaters); and covered walkways or landings up-to four feet wide under eaves or overhangs that are not part of an uncovered open deck, patio, lanai or similar structure.”

Who Doesn’t Want to Have a Bigger Deck?

The changes in accessory dwelling rules also allows for bigger covered and uncovered lanai spaces. The new covered lanai spaces are shown via the table below.

Lot Area in Square Feet	Maximum Gross Covered Floor Area (sq. ft)
Up to 7,499	200
7,500 to 9,999	240
10,000 to 21,799	280
21,780 to 43,599	320
43,560 to 87,119	360
87,120 or more	400

The table above includes the square footage for covered decks, walkways, patios, lanai or similar structures.

There are similar allowances for uncovered decks, lanais and patios.

Lot Area in Square Feet	Maximum Cumulative Floor Area (sq. ft)
Up to 7,499	200
7,500 to 9,999	240
10,000 to 21,779	280
21,780 to 43,559	320
43,550 to 87,119	360
87,120 or more	400

For both of the above tables, “cumulative floor area” excludes walkways or landings up to four feet wide under eaves or overhangs that are not part of a deck, patio, lanai or similar structure.

No More Vacation Renting Accessory Dwellings

The underlying goal of the changes to accessory dwelling laws was to create more housing inventory for local residents. With that in mind, the county established a prohibition on using accessory dwellings as short terms rentals, vacation rentals or as part of a Bed and Breakfast. This is to ensure that the new accessory dwellings don’t become Airbnb rentals.

What’s Not Covered by the Bill

The changes to accessory dwelling laws are limited to properties with the appropriate zoning. One place where there might be some confusion is with properties that are zoned agricultural. While ag zoning allows for “ohanas,” the cottage structures on agricultural lots are considered to be “accessory farm dwellings.” The rules for “Accessory farm dwellings” have not been changed by this bill.

While this bill allows for an increase in density, home owners will find that that parking and water could be a constraint to building out a property to its full capacity. I had already mentioned the need for sufficient off street parking for any accessory dwelling. Fixture count will also be a factor for that property owners will need to consider if they want to take advantage of the new law.

Maui County limits the number of plumbing fixtures that can be installed with a standard 5/8ths inch water meter. It is pretty easy to hit fixture limits with a main house and an ohana. Within the last few years, the county started to allow home owners to buy additional fixture points. If someone wants to build a second accessory dwelling, they may need to buy the additional fixture points or even a second water meter. In places like the North Shore and Upcountry, a second water meter is not an option. Let’s hope that water constraints do not undercut the potential of the bill. With Maui in desperate need of more long term rentals, this bill seems like a positive step to generate some much needed rental housing.

July 1 marked the start of the new fiscal year for Maui County. A new year brought a new budget and new property tax rates for the county. While recent history has seen tax rates decrease when property values have increased, this year was different. Rates went up for all classifications despite generally increased assessed values throughout the county. You will find the new rates below with last year’s rates provided for frame of reference.

• The new residential rate is $5.54 per $1,000 of assessed value. That is a 14 cent increase from last year’s rate of $5.40 per $1,000 of assessed value.
• The new apartment rate is $6.32 per $1,000 of assessed value. That is up 32 cents from last year’s rate of $6.000 per $1,000.
• The commercial rate for this year is $7.28 per $1,000 of assessed value. That is an increase of 68 cents from the 2016/2017 rate of $6.60 per $1,000 of assessed value.
• The industrial rate for this fiscal year is $7.49. That is an increase of 80 cents over last year’s rate of $6.69.
• The agricultural rate increased to $6.01 per $1,000 of assessed value. That is a change of 25 cents over last year’s rate of $5.66.
• The conservation rate for the year is $6.37 per $1,000 of assessed value. That increased from 57 cents over the last year’s rate of $5.80.
• The hotel/resort rate for this fiscal year is $9.37 per $1,000 of assessed value. That is a 66 cent increase over last year’s rate of $8.71 per $1,000 of assessed value.
• The timeshare rate went up to $15.43 per $1,000 of assessed value. That is an increase of $1.12 from the rate of $14.31 per $1,000 for the previous fiscal year.
• The homeowner rate increased to $2.86 per $1,000 of assessed value. That is an increase of 16 cents over last year’s rate of $2.70 per $1,000 of assessed value.
• The commercialized residential rate is $4.56 per $1,000 of assessed value. That is a 21 cent increase over last year’s rate of $4.35.

Property taxes are paid biannually in Maui County. The first bill comes up in August with the second bill following in February. Property owners are notified of changes in assessed values in March with the rates themselves deliberated and updated sometime between April and June during the year. If you have additional questions on Maui Property taxes check out the Maui county property tax FAQ.

Rents are rising on Maui. Borrowing costs remain low. In this type of market, a place like Keonekai Villages 14-103 is a compelling buy if you have money set aside for a down payment.

Keonekai Villages 14-103 is listed for $257,000. With 5% down at an interest rate of 3.92%, monthly mortgage payments are $1,154 a month. The current maintenance fee is $274 a month. That includes, water, trash, refuse and basic cable. Insurance would run roughly $300-$350 a year or $25 to $29.17 per month. That comes to $1,457.17 per month. Other expenses would include electricity, Internet and property taxes. The current owner is paying a $1,694 in property taxes annually. If you are a Maui Resident who paid local taxes in 2015, you could be eligible for a lower homeowner tax rate as long as you file for the new rate before the end of the year. With exemptions, your taxes would be $500 or less. I searched Craigslist to see if I could find any rentals in Keonekai Villages that might be comparable. The only recent listing I could find was asking $1,600 a month plus electricity. A Maui resident paying homeowner tax rates would be paying less to own the condo than the cost to rent.

Keonekai Villages 14-103 isn’t just a case study for buying, it also offers a great location. It is situated within a few blocks of the Kamaole II and III Beach Parks. These are some of the best swimming and snorkeling spots in South Kihei. Shops and restaurants are also within walking distance of Keonekai. The beaches and amenities of Wailea and Makena are anywhere from two to ten minutes drive.

This condo sold in 2016. Calculations on condo ownership changed with the Covid Real Estate Boom. Contact The Maui Real Estate Team if you are a first time home buyer to discuss the current pros and cons of buying in this market.

Maui County has opened the spigot a little more when it comes to water fixtures. It is now allowing property owners to purchase a limited number of additional fixtures units for their water meter. I realize this post may sound like Greek to those who haven’t ever looked into adding bathrooms on to an existing home or adding a new accessory dwelling. with that in mind, I wanted to give a little background on fixture count, why it is an important issue and what the new rules are about.

In the county of Maui, different water fixture counts are applied to different sized water meters. The process can be a little bit confusing. The limitation on water fixtures is not applicable to when a home is first built on a property. However, if you want to expand on that home or build a cottage, you are capped at a certain number of water fixtures based on meter sizes. The most common water meter is a 5/8ths inch meter. The base configuration allows for 31 points worth of water fixtures. Different water fixtures are assigned different points. For example, a water spigot is assigned 3 points, a low flow toilet is assigned 1.7 points while a conventional toilet is assigned 3 points. If an existing structure has fixture totals that are equal to, greater than or even close to 31 points; the county would be unlikely to approve any additions or accessory dwellings that have additional plumbing. For parts of the island where additional water meters are available, the owner of the property would need to have a new water meter installed. That in itself is an expensive and not necessarily a quick process. For areas like Upcountry Maui and parts of the North Shore, that may not be an option. Those parts of the island have a closed waiting list for water meters. It will be many years before the county makes its way through that list.

These policies have been grumbled about by property owners for some time. That said, it first entered the public discourse in the fall of 2015 when the issue was raised in a county council meeting. The county has been looking at addressing some of the island’s housing shortage via infill development. In other words, they were looking at where they could add density by allowing people to build more accessory dwellings. They are even considering lowering the lot size requirements for accessory dwellings. The current fixture count limits were a potential impediment to property owners building more accessory dwellings.

As of July 1, the county has given homeowners a path to raise their fixture counts. Owners can increase their total number of fixture units by paying a fee per each additional fixture unit. There are limits to the number of units each home can purchase. This is the run down on the new fixture count rules by meter size.

Fixture unit costs and allocations are as follows:

• The standard 5/8 inch water meter currently has 31 fixture units. At a cost of $389 per fixture unit, an additional 8 fixture units may be purchased.
• A 3/4 inch water meter currently allows for 53 fixture units. You can now by as many as 14 additional fixture units at cost of $356 per fixture unit.
• A 1 inch water meter allows for up to 128 fixture units. Property owners can now pay to raise their capacity by an additional 32 fixture units at a cost of an additional $261 per fixture units.

These new rules are a positive step in creating some infill development on Maui and at least addressing a portion of the limitations on housing inventory. They also make it easier for people to add a new bathroom if they had previously tapped out their fixtures. Here is a link to a Maui County Plumbing Worksheet to show the full list of values of different plumbing fixtures. Check out the Maui County Department of Water Supply for more information on the county water system. The Engineering department is the group that handles water meters.

Updated Maui County Property Tax Rates for the New Fiscal Year

The new fiscal year for Maui County starts on July 1 and that means new property tax rates. The Maui County Council approved a new budget that saw a reduction in property tax rates for almost every property tax classification. Some of the reduction in rates may be offset by increased assessed values for properties. This is following a general pattern with Maui County Property tax rates. When the market is going up rates are decreased. When market values go down, property tax rates go up. You can see the new rates compared to the old rates below.

• The Residential tax rate will be $5.30 per $1,000 of assessed value. That is a decrease of 10 cents from the 2015/2016 tax rate of $5.40.
• The Apartment tax rate will be $6.00 per $1,000 of assessed value. That is unchanged from last year’s tax rate.
• The Commercial tax rate will be $6.60 per $1,000 of assessed value. That is also unchanged from last year.
• The Industrial tax rate is $6.69 per $1,000 of assessed value. That is a decrease from $6.85 last year.
• The Agricultural tax rate is $5.66 per $1,000 of assessed value. That is down from $5.75 in 2015/2016.
• The Conservation tax rate is $5.80 per $1,000 of assessed value. That is a decrease from last year’s rate of $5.90.
• The Hotel and Resort tax rate is $8.71 per $1,000 of assessed value. That is a decrease from the previous rate of $8.85.
• The Time Share rate is $14.31 per $1,000 of assessed value. That is a healthy decrease from the old rate of $14.55.
• The Homeowner rate is $2.70 per $1,000 of assessed value. That is a down from last year’s rate of $2.75.
• The Commercialized Residential rate is $4.35 per $1,000 of assessed value. That rate remains unchanged.

Property tax rates are paid biannually in Maui County. The first bill comes due in August with the next payment made in February. Tax rates for the next fiscal year will be debated again in the Spring with the County Council approving new rates sometime in late May or June.

Yesterday, Tropical Depression Flossie passed over Maui. What was once a strong tropical storm with sustained wind gusts of 60 miles per hour, rapidly deteriorated over a period of 18 hours. The storm felt the impact of high level winds that helped to break apart the circulation of the storm. Flossie still had enough juice when it crossed Maui to bring one of the biggest thunderstorms I have seen since I have lived on island. You can get a taste for Flossie’s thunder and lightning in this short clip from the peak of the storm.

For those of you who have never lived in Hawaii, you may be wondering about the impact of Hurricanes on the islands. Formal records on Hurricanes in Hawaii started in 1950. Since the Fifties, there have been 45 tropical depressions, storms or hurricanes that have approached the vicinity of the Hawaiian Islands. The storms usually originate in the Eastern Pacific off the coast of Mexico. As they traveled West towards Hawaii, many of the storms grew into significant Hurricanes only to dissipate quickly as they approach the islands. A good example of that is Hurricane Flossie which approached within a few hundred miles of the Big Island in 2007 as a Category Four Hurricane. It quickly weakened into a Tropical Storm within 24 hours. High level winds and cooler waters to our East have been contributing factors as to why Hurricanes tend to dissipate close to Hawaii. Some have surmised that the Big Island’s massive volcanoes somehow also play a role in weakening tropical systems approaching from the east. I haven’t seen any firm data to support that assertion other than the fact that mountains can weaken storms that make landfall.

While most Hurricanes lose steam before they get to Hawaii, there have been some that have had more significant impact on the islands. Hurricane Iniki had a direct hit on Kauai in 1992. It was a devastating storm that did approximately Two Billion Dollars in damages. Even diminished storms can have an impact bringing dangerous surf, gusty winds, electrical storms and flash flooding. Residents and visitors should always take precautions when a storm approaches the islands. Here are some important to dos when preparing for a potential tropical storm:

• Prepare an Emergency Supply Kit well in advance of the storms arrival.
• Prepare your house for the impact of a storm
• Fuel your vehicles. Storm damage could disrupt the supply of gas coming to service stations.
• Get your storm information from good resources. I saw lots of amateur weathermen taking to social media yesterday morning saying the storm was a complete non-event because it wasn’t raining in the morning. Flossie may have lost some strength but she still wasn’t supposed to have had an impact until the afternoon. That made for some surprises when the afternoon thunderstorms struck Maui. The Central Pacific Hurricane Center is your best resource for complete forecast information.

While Hawaii is not nearly as vulnerable to Hurricanes as the Gulf and Atlantic coast of the mainland, Hawaii residents should always be prepared for the worst and hope for the best. Of note from a real estate perspective, many lenders require Hurricane Insurance with a home or condo purchase in Hawaii. Even if you are a cash buyer for a property, Hurricane Insurance is not a bad a idea. It makes sense to at least review your basic homeowner’s policies to see if you have sufficient coverage in the event of flood, storm surge and wind related damages.