Hawaii Residents Have Finally Moved Into New Maui Homes 18 Months After Devastating Wildfires—but There’s a Catch

The lengthy process of rebuilding the Maui, HI, communities that were devastated in the 2023 wildfires has taken another somewhat shaky step forward, 18 months after residents were forced to flee the blazes that ultimately destroyed more than 2,000 homes and buildings.

Now, some of those residents have finally been able to return to the stricken area, after being provided with temporary accommodations designed to house them while the efforts to restore their homes continue.

But though the temporary dwellings may provide some with a sense of relief, that could be very short-lived—with residents being warned that there is no guarantee how long the wood-framed, modular tiny homes will be able to withstand the sun and salt air.

The tiny home community that was built as a placeholder for those who lost their homes in the fires is made up for 450 dwellings set on a beachside lot in West Maui.

To some, it may sound like a paradise—but according to one local lawmaker, there could be further nightmares in store for the neighborhood’s longtime residents amid fears of skyrocketing rents that could price out families who have lived there for years.

Elle Cochran, a member of the Hawaii House of Representatives representing the Lahaina area, told Realtor.com® that she expects post-FEMA rents to be sky high and worries that families will be forced to leave.

“We’ve had a housing crisis well before this fire. And then obviously the fire just exacerbated it, made it a billion times worse,” she says.

The new development is for residents affected by the Lahaina fire who don’t meet requirements for FEMA (Federal Emergency Management Agency) housing.

The homes sit on state-owned land, and each unit is estimated to cost $411,000.

Looking back

In August 2023, wildfires spread through parts of Maui, destroying more than 2,200 homes and structures, killing more than 100 people, displacing more than 12,000 residents and causing about $5.5 billion in damages.

Many of those residents have returned to the island in the wake of the Lahaina fires—a vast majority living in temporary shelters. Meanwhile, a recently released study found that only around 500 people left the island for good.

To help ease the housing crunch, several 2024, nonprofit HomeAid Hawai‘i broke ground on Ka La‘i Ola, a temporary housing community of 450 one-, two-, and three-bedroom homes on the island. The organization was criticized for the ballooning cost of the units; the project was originally budgeted at $115 million but has swelled to $185 million.

Residents of Ka La’i Ola are only guaranteed housing in these units over the next five years. In 2029, the land the homes are built on will be transferred to Department of Hawaiian Home Lands and requisitioned to Native Hawaiians.

Nearby, FEMA is in the process of building an additional 167 units at a Kilohana Temporary Group Housing site. They’re also in the process of leasing land from around 175 home owners who don’t plan to rebuild, with the aim of building smaller temporary homes on their land. But FEMA’s housing is only guaranteed until 2026; and while expenses are currently being covered, families will need to begin paying rent in March.

The fire exacerbated an already-present problem

Even before the fire, Maui faced a housing shortage, thanks in large part to locals renting out their homes to tourists. In fact, Maui County has seen a net decrease in housing since 2019. That’s only compounded the struggle for those whose homes were destroyed and driven up rents.

For months after the Lahaina fires, residents were put up in local hotels; but in an area where tourism brings in $14 million a day, that wasn’t a long term solution.

Ironically, in the months following the fire, the influx of tourists back into the area created an extreme housing shortage, as visitors flocked to short-term rentals, pricing out locals.

A report from UHERO, the economic research organization at the University of Hawaii found that the average Craigslist rental price in Maui in the months following the fire was $2,500, significantly more than the U.S. Census Bureau’s estimate of typical household rent in Lahaina—$1,700.

That’s part of why local politicians have moved to ban short-term rentals in the area. In July 2024, Maui’s County Planning Commission voted in favor of phasing out 7,000 short-term rentals in a bid to create more long-term housing in the area. If approved, the policy would go into effect in July 2025.

That ban is likely to exacerbate an economic crisis for many residents who rely on tourist dollars for income.

Water access waylays building

A year after the fire, UHERO found that around 60% of those who lost their homes were still living in some form of temporary housing—be it hotels, with friends or family, or living in smaller structures, which has caused some families to have to split up.

Slow permitting is contributing to an overall dearth in new construction and though more than 200 building permits have been issued since the fires, only three homes have been rebuilt.

Within two weeks of the fire, local nonprofit Family Life Center launched Ohana Hope Village, aiming to build 88 homes; but zoning laws and long permit wait times significantly slowed down the construction process, and a year later, only 10 of the 85 homes are occupied. Wait times for permits run around 200 days, according to a report from the libertarian policy organization Grassroots Institute of Hawaii.

Access to water is one of the major barriers to building. Cochran says the building of these temporary homes in areas outside of Lahaina proper has led to a run on water resources. The temporary housing in the area has requisitioned water away from the town center.

“For me, the bottom line is the water resources being utilized at any of those temporary places is using the water that belongs in the town of Lahaina,” she says. “For me, I thought government should have focused on getting the people build their homes so our Lahaina families can stay home in Lahaina and go back to their properties.”

At a congressional hearing last September, Maui Mayor Richard Bissen told reps that privately owned water supplies made building additional homes difficult.

“Water is probably the greatest barrier, at least for the west side. Seventy-six percent of the water on the west side is privately owned. Twenty-four percent is owned by the county, and that is, again, one of the barriers for us to work with,” Bissen said.

Bissen also cited wastewater infrastructure as another problem hindering new construction.

In an effort to speed up the process, the County of Maui Department of Planning created a Special Management Area exemption for land within the designated Lahaina Disaster Area.

The exemption aims to “cut the time it takes to go through the typical SMA exemption process as we collectively work together to return residents to their homes in Lahaina,” County Planning Director Kate Blystone said. 

Cochran remains frustrated by the lack of progress.

“You have a recovery plan, you have a recovery office, you have everything. But where is the rebuilding in Lahaina?” she wonders. “It’s not happening, and the infrastructure is in. There is water, power, sewers, so it’s not about, oh, we don’t have infrastructure. The infrastructure has been back for months now.”

Cochran is perturbed that luxury condos have managed to be developed, while locals continue to live in temporary housing.

“Lahaina Shores, there’s people living in it; and I know that they’re already selling $600,000 units out of that building,” she says. “And I’m like, ‘Well, how is that already up and running when you’ve got single family homes around it, like across the street and stuff, who can’t get permits to rebuild their home? What the hell’s wrong with that picture?'”