Recently, several important changes were made to the housing and zoning laws in the City and County of Honolulu, Hawaii regarding Accessory Dwelling Units (ADUs). Bill 20 and Bill 21, amend Chapter 21 of the Revised Ordinances and now allow new permits for ADUs on many Oahu properties.
PROS AND CONS
These bills were passed in response to increased concern about affordable rental housing in Honolulu County. These new laws not only increase the available, affordable housing on Oahu, but also give many strapped homeowners an additional source of income. This is important as many Oahu residents pay a disproportionate amount of their income toward very expensive housing.
Allowing legal ADUs will also increase tax revenue to Honolulu, as government officials project that many more people will now be paying General Excise and income taxes on their rental income, including formerly illegal rentals.
Opponents of these bills believe that allowing ADUs will result only in more illegal vacation rentals and increase neighborhood congestion. To help address these concerns, Bill 22 was enacted, along with Bill 20 and Bill 21, cracking down on illegal vacation rentals.
ACCESSORY DWELLING UNITS REQUIREMENTS
An Accessory Dwelling Unit is a living unit which has a full kitchen, bathroom(s) and a living/sleeping area(s). Under the rules, the ADU may be either attached or detached to the primary single-family dwelling. An ADU may be built only on lots of 3,500 sq ft or more and also, they typically may not be built in areas controlled by associations (e.g., Mililani). ADUs also cannot be built on lots with a zero lot line, R-3.5 zoning, duplex lots, cluster lots or non-conforming lots.
Unlike Ohana units, ADUs are not restricted to occupancy by family members. However, the owner of the property (or a relative by blood, marrage, or adpotion) must occupy either the primary dwelling or the ADU.
New permits for ADUs will be granted only in areas where existing sewer connections, water supply and transportation facilities are adequate. However, preexisting units can be grandfathered in and continue to operate, if they meet certain criteria.
Another important restriction on ADUs is that the ADU (or primary dwelling) is not to be sold separately after built. In other words, the property may not be subdivided or CPRed, to create individual properties which may be sold separately. Homeowners are required to execute a covenant running with the land as to the inability to separate and sell the properties in this manner.
To help with affordability, Accessory Dwelling Units are limited to a size of up to 400 sq ft on lots up to 4,999 sq ft and up to 800 sq ft on lots over 5,000 sq ft. All Oahu ADUs must have at least 1 off-street parking (may be compact or tandem) for studios and 1 bedrooms, and 2 off-street parking if a 2 bedroom unit, except if the ADU is within 1/2 mile of a rail station. This is to help ease concerns of neighborhood auto congestion.
NO ILLEGAL VACATION RENTALS
Accessory Dwelling Units are not to be used for illegal vacation rentals and will require a minimum 6 mo lease (which can go mo-to mo thereafter with the same tenants). Enforcement of illegal rentals is expected to pick up, as the City and County is hiring several new inspectors to address the thousands of vacation rentals advertised on places like AirBnB.com and VRBO.com. An advertisement for an ADU must include the property address in the ad. Also, an advertisement for an ADU rental for less than 6 mo is prima facie evidence of illegal rental. Penalties for having an illegal rental can exceed $1000 per day.
For more information on the purchase or sale of properties with ADUs, please contact Yvonne Ahearn (B) Home Shoppe Hawaii LLC at 808-721-8088.