Uncertainty Became Policy - and Policy Became the Market
As we close out 2025, it’s clear that this was not a “normal” year for Maui real estate — and it wasn’t meant to be.
This was the year uncertainty finally hardened into policy. The year recovery moved forward, but not evenly. This year the market stopped reacting emotionally and started adjusting structurally.
For buyers, sellers, investors, and property owners, 2025 forced a recalibration. Expectations changed. Risk was repriced. And the gap between headlines and reality became more important than ever to understand.
This year-in-review is not meant to be promotional or predictive. It’s meant to be useful. What actually happened, what mattered most, and what we should all be paying attention to as we move into 2026.
1. Bill 9: From Debate to Law - and Into the Courts
For most of the past two years, Bill 9 lived in the realm of debate: proposed language, draft amendments, public testimony, and political signaling. In 2025, that changed.
Bill 9 became law.
What is important to state clearly — and what was often blurred in public discourse — is that Bill 9 never contained any provisions that addressed housing, and certainly nothing to address affordable housing. It did not create housing units. It did not fund housing. It did not provide affordability. Its function was, well as it turned out, unclear even to the mayor and the council members that supported it.
Throughout the legislative process, the stated purpose of the bill shifted. At various points it was framed as a housing bill, an affordability measure, a workforce housing solution, and later as a zoning “correction.” Those explanations were not consistent, and the lack of consistency mattered.
Councilmember Tamara Paltin’s actions around the so-called “safe list” underscored this problem. When selecting which condominium complexes would be phased out from the STR/hotel zoning, she included luxury resort properties such as the Kapalua Golf Villas and Ridge Villas, stating publicly that “we need housing at all price points.”
That statement reflects a fundamental misunderstanding of how real estate works.
Anyone who wants to live full-time in a resort-zoned or hotel-zoned condominium can already do so today. Zoning does not prevent owner occupancy. Changing zoning does not create affordability. Including luxury resort properties under the banner of “housing at all price points” confuses ownership with use — and reveals a disconnect between rhetoric and reality.
From the beginning, our concern was never framed as “housing versus tourism.” We need housing, period. And our economy needs tourism, period.
The Temporary Investigative Group (TIG), which we’ll touch on shortly, sought to address both the economics and the sequencing — including unintended consequences and the absence of a fully built alternative before removing an existing one.
In 2025, that concern remained unresolved.
Key realities emerged:
- The bill passed before replacement hotel-zoning mechanisms were fully in place.
- Enforcement timelines exist on paper, but implementation details remain unclear.
- The first lawsuits were filed, signaling that the next phase would be judicial, not legislative.
For the market, this created uncertainty with consequences. Buyers paused. Sellers adjusted. Lenders became more cautious. And apartment-zoned short-term rental properties carried a newly defined regulatory risk.
The most important takeaway from 2025 is this:
Bill 9 is now law — but its real-world impact remains unsettled.
2. The TIG Report: Where Math Met Policy
One of the most important — and often misunderstood — developments in 2025 was the Temporary Investigative Group (TIG) report.
What made the TIG significant wasn’t politics. It was math.
The report forced a public conversation around tradeoffs: tax revenue, visitor spending, employment, housing feasibility, and zoning reality.
It highlighted something many property owners already understood intuitively: a meaningful number of apartment-zoned properties were never designed to function as long-term residential housing — due to size, location, amenities, and critically, home owner association structure and fees.
In many cases, condominium association fees alone make these properties effectively disqualified — as affordable housing.
The TIG introduced a logical, two-step framework:
1. Create appropriate hotel-zoned classifications for properties that clearly function as visitor accommodations.
2. Then address apartment-zoned housing where long-term residential use is functionally more viable.
That sequencing question remains unresolved at best heading into 2026.
Compounding this concern, at the first County Council meeting intended to address the rezoning process revealed something troubling: some council members appeared more focused on undermining or delaying the resolution than advancing a workable path forward.
That moment reinforced a key theme of 2025 — progress is possible, but it is not guaranteed.
3. Lahaina Recovery: Progress Without Normalcy
Lahaina’s recovery continued in 2025 — and that statement is both true and incomplete.
There was progress. More structures completed. Infrastructure returning. Limited harbor operations resuming.
But one moment crystallized the reality for me.
I was standing on Front Street, next to a lot I was preparing to list for sale. I looked around at the visible progress — the activity, the movement, the signs of rebuilding. Just days earlier, the County had proudly announced that 100 homes had been completed.
And we should be proud of that milestone.
But standing there, in the otherwise empty street, the math hit me.
It has been two and a half years since approximately 2,200 properties were destroyed. One hundred completed homes is progress — but it is also a stark reminder of how far we still have to go.
Recovery is not a single event. It is a long sequence. In 2025, Lahaina moved from emergency response into staging. That matters — but it is not the same as recovery, and certainly not normalcy.
4. Maui's Economy: Improved, Flattened, and Fragile
Compared to 2024, Maui’s economy improved in 2025. Visitor counts increased. Activity stabilized. The sense of freefall eased.
But two structural challenges became increasingly clear.
First, Maui’s economy is deeply dependent on tourism — and tourism depends on people. Since the fires, hundreds of residents have left the island. Many of them worked in hospitality and service-related industries.
For the businesses that survived, the ability to provide consistent, high-quality service has been strained by a lack of reliable employees. Staffing shortages are no longer a short-term issue; they are a structural one, and they affect guest experience, operating costs, and long-term sustainability.
Second, while tourism numbers improved, profitability did not necessarily follow.
For many condominium operations, increased competition forced nightly rates down — in some cases below breakeven — simply to generate cash flow. Occupancy improved, but margins compressed. Revenue existed, but profit often did not.
The takeaway is realism, not pessimism.
Maui got by in 2025 — but not in a sustainable way. Something has to change in 2026.
5. The Real Estate Market: Not One Market, But Many
If 2025 taught us anything about real estate on Maui, it’s that generalizations are dangerous.
Condos
The condominium market spent most of 2025 firmly in buyer-market territory, but buyer activity remained light and extremely cautious.
Uncertainty around zoning, enforcement, litigation, and long-term use created a situation where even sellers and experienced agents struggled to determine what pricing would attract serious attention.
For many sellers, the year was not just challenging — it was frustrating and emotionally draining. Properties sat. Showings were limited. Feedback was inconsistent. The lack of certainty made rational pricing difficult, and in some cases demoralizing.
This was not a normal buyer’s market. It was a market constrained by hesitation rather than demand alone.
Homes
Single-family homes continued to segment sharply by quality, location, and condition. Well-priced, well-presented homes still sold. Aspirational pricing did not.
Luxury
The luxury market didn’t crash — it adapted.
We saw longer marketing timelines, meaningful price reductions, canceled and relisted properties, and a return of auctions as a price-discovery tool.
Luxury buyers remained active, but not impulsive. They demanded value, clarity, and realism. The result was fewer transactions — but more intentional ones.
6. Investors: The Year Risk Stopped Being Abstract
For investors, 2025 was a year of recalibration.
Risk stopped being something investors talked about and became something they had to plan for. Regulations came with real timelines. Insurance became more expensive and less predictable. Monthly carrying costs increased. And selling a property could no longer be assumed to be quick or straightforward.
What changed was not the sophistication of investors, but the environment they were operating in.
Long-standing assumptions that many investors had relied on — stable zoning, predictable uses, and slow or unlikely regulatory change — no longer applied. Things that had been taken for granted now had to be questioned.
Investors were forced to slow down and look more carefully at the basics: how long they could realistically hold a property, how much cash flow variability they could tolerate, how resilient the operation would be under stress, and what a downside scenario might actually look like.
2025 was not a year that rewarded bold moves or aggressive assumptions. It was a year that required realism by all.
7. What We’re Watching in 2026
As we move into 2026, a few very specific things will matter more than broad predictions or optimistic headlines.
First, we’re watching how the courts handle the lawsuits related to Bill 9, including whether any injunctions slow or reshape implementation.
Second, we’re looking for real guidance from the County — not intentions or press statements, but actual clarity on how the law will be enforced and on what timeline.
Third, we’ll see whether proposed hotel-zoning solutions move beyond discussion and into something workable. Concepts are easy. Execution is harder.
At the same time, tourism will continue to matter. The question isn’t whether people will keep coming to Maui — it’s how strong demand will be in a softer economic environment and what that means for revenue, staffing, and pricing power.
Finally, all of this unfolds in an election year, where politics can influence both timing and tone.
In 2026, clarity — even if it’s imperfect — will be far more valuable than optimism.
Closing: Clarity Over Certainty
2025 was not a year that delivered clarity.
It was a year that exposed how much uncertainty still exists — around zoning, enforcement, litigation, interest rates, and the broader economy.
As we move into 2026, many of the biggest questions remain unanswered. We don’t yet know how the County will ultimately handle zoning. We don’t know what the courts will do with the lawsuits now underway. And we don’t know when — or if — borrowing costs will meaningfully come down.
What we do know is that pretending certainty exists when it doesn’t leads to bad decisions. In this environment, the most valuable thing is not confidence or optimism, but honesty about risk and a willingness to plan for multiple outcomes.
If there is one lesson from 2025, it’s this: thoughtful, local, data-driven advice matters most when the answers are unclear — not after they finally arrive.
If you got this far, thanks for reading. I owe you Mai Tai next time you’re on island.
