If you own or are considering investing in a rental property on the Big Island, there’s one major update you can’t ignore: Ordinance 25-50. Also known as Bill 47, this new law is reshaping how short-term vacation rentals are tracked, regulated, and enforced across Hawaiʻi County.
While it doesn’t eliminate vacation rentals, it does introduce important new requirements that every property owner should understand heading into 2026.
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A Shift Toward Registration and Accountability
At its core, Ordinance 25-50 is about registration – not restriction.
The law requires all transient vacation rental (TVR) operators to register their property with Hawaiʻi County and renew annually, rather than simply operating without oversight.
This includes providing key property details and demonstrating compliance with tax and safety requirements.
The goal? Increase transparency, ensure proper tax collection, and create a system for tracking active rentals across the island.
Hosted vs. Unhosted Rentals: A Key Distinction
One of the biggest changes is how the county now distinguishes between two types of rentals:
- Hosted rentals: The owner lives on-site (such as renting a room or ohana unit)
- Unhosted rentals: The property is rented out without the owner present
Previously, hosted rentals operated with far less oversight. Under Ordinance 25-50, hosted rentals are now required to register and follow county rules, bringing them into the same regulatory framework as other short-term rentals.
This is a major shift – especially for homeowners who assumed smaller, owner-occupied rentals were exempt.
What Hasn’t Changed
Despite concerns from some property owners, it’s important to clarify what this law does not do:
- It does not change zoning laws or where vacation rentals are allowed
- It does not cap the number of rentals on the island
- It does not replace existing permit requirements for unhosted rentals
In other words, if your rental was legal before, it can still be legal – you’ll just need to comply with the new registration system.
Deadlines and Timeline
Originally set to take effect in late 2025, enforcement of Ordinance 25-50 has been extended to July 1, 2026, giving owners more time to prepare.
However, waiting until the last minute is not recommended. Once the system is fully implemented, the county plans to actively cross-reference listings on platforms like Airbnb and VRBO to identify unregistered properties.
New Fees and Ongoing Requirements
The ordinance introduces both initial registration fees and annual renewal costs, which vary depending on the type of rental.
Additionally, booking platforms themselves are now part of the equation, with new accountability requirements to ensure listings display valid registration and tax numbers.
This signals a broader move toward professionalizing the vacation rental industry on the Big Island.
Why This Matters for Property Owners
For compliant owners, this law may actually be a net positive.
By requiring all operators to register and follow the same rules, Ordinance 25-50 could:
- Reduce competition from illegal or unpermitted rentals
- Increase trust and transparency in the market
- Stabilize neighborhoods impacted by high visitor turnover
On the flip side, owners who ignore the new requirements may face penalties, fines, or forced shutdowns once enforcement ramps up.
What Buyers and Investors Should Consider
If you’re thinking about purchasing a rental property on the Big Island, this ordinance makes due diligence more important than ever.
Key questions to ask:
- Is the property located in a legally permitted rental zone?
- Is it already registered or eligible for registration?
- What type of rental (hosted vs. unhosted) best fits your goals?
Properties in established resort areas like Kona or Waikoloa may offer more long-term security, while others may require closer review.
Looking to book your next stay? See our vacation rental portfolio
Final Thoughts
Ordinance 25-50 doesn’t eliminate opportunity – it redefines it.
The Big Island vacation rental market is moving toward greater structure, accountability, and professionalism. For property owners who stay informed and compliant, this creates a more stable and predictable investment environment.
At First Island Realty, we’re closely tracking these changes and helping our clients navigate what they mean in real terms. Whether you already own a rental or are considering entering the market, understanding Ordinance 25-50 is essential to protecting your investment and planning for the future.
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