Waianae Coast STR Submarket Report

Oceanfront vacation rental in Waianae featuring private pool, modern lanai, and unobstructed sunset

Introduction

The short-term rental (STR) industry in the U.S. is experiencing robust structural growth, driven by several converging trends. Leisure travel demand remains elevated in the post-pandemic era as travelers increasingly prefer spacious, private accommodations over traditional hotels. This is coupled with constrained hotel supply – in many markets, new hotel construction has not kept pace with surging demand, pushing travelers toward STRs (especially in areas where hotels are few or heavily regulated). Meanwhile, the STR sector’s professionalization has accelerated: large operators and investors have entered the market, leveraging technology and data analytics to optimize pricing and occupancy. The result is a maturing industry that is more efficient and profitable, with vacation rentals now a mainstream lodging option contributing significantly to tourism growth.

Within this booming national context, Hawaii’s Waianae Coast has emerged as one of the top-performing and highest-potential STR submarkets in the United States. Located on Oahu’s less-developed west shore, the Waianae Coast offers a combination of attributes that make it exceptionally attractive for STR investment. It boasts natural appeal – stunning uncrowded beaches, lush mountain backdrops, and an authentic, laid-back Hawaiian atmosphere far from the congestion of Waikiki. Importantly, the area has a notable lack of hotel competition. Oʻahu’s strict zoning rules mean few if any resorts or hotels operate on the Leeward (west) coast, so vacation rentals pick up the slack in accommodating visitors. Travelers seeking a peaceful island escape (often families or groups) are willing to pay a premium for private beach houses here, given the scarcity of alternatives. This dynamic has led to exceptional rental yields – properties on the Waianae Coast achieve some of the highest average revenues in Hawaii, on the order of six figures annually per listing, alongside strong occupancy levels.

Purpose and structure: This report provides a comprehensive analysis of the Waianae Coast STR submarket’s performance and investment outlook. We begin with an executive summary of key performance metrics and an overall Submarket Score. We then delve into market performance trends, supply composition, demand patterns, revenue and rate dynamics, and finally, regulatory and investment considerations specific to this submarket. Throughout, we reference industry data (primarily AirDNA analytics) and local context to illustrate why Waianae Coast is a standout STR market with high potential for investors and operators alike.

Executive Summary

Waianae Coast – By the Numbers (2024 vs 2023):

• Annual Rental Revenue (Avg per Listing): ~$103.9K (≈ +21% year-over-year growth).

• Occupancy Rate: ~78% (up 4 percentage points YoY, indicating demand growth).

• Average Daily Rate (ADR): ~$431 per night (+15% YoY, reflecting higher pricing power).

• Revenue per Available Rental (RevPAR): ~$337 (+20% YoY, combining the above gains).

These metrics place Waianae among the top-tier STR markets nationally in terms of income generation. Notably, an alternate analysis found even higher averages for this area (occupancy ~81% and ADR ~$517), underscoring the extraordinary performance potential when demand outstrips limited supply. According to AirDNA’s composite Submarket Score, Waianae Coast rates a perfect 100, ranking it as one of the strongest U.S. STR submarkets. This score reflects the submarket’s exceptional Rental Demand (94/100) and Investability (92/100), fast Revenue Growth (88/100), and extreme Seasonality (99/100). The Regulation factor is a more modest 70/100, acknowledging Oʻahu’s restrictive rental laws (discussed later). In summary, the Waianae Coast offers investors an attractive profile: high rental income, consistent demand, relatively affordable entry costs, and manageable (though not trivial) regulatory hurdles. The following sections detail these points, reinforcing why Waianae is considered a top short-term rental market in 2025.

Market Performance Overview

The Waianae Coast STR market has delivered impressive year-over-year performance gains. Average revenue per listing climbed roughly 21% in the past year, a result of both increased pricing and solid occupancy growth. Specifically, nightly rates have surged (ADR up about 15% YoY) as operators capitalize on the area’s popularity, and occupancy has ticked upward to an average ~78%, about 4 points higher than the previous year. These improvements boosted RevPAR (revenue per available rental) by approximately 20% year-on-year, indicative of stronger earnings power across the market. By comparison, many U.S. vacation rental markets saw flatter growth due to softening travel demand in 2023–24, but Waianae’s metrics bucked that trend, highlighting its resilience and appeal.

Seasonality plays a significant role in Waianae’s performance pattern. Tourism demand is year-round in Hawaii, but peaks in the winter and summer months. During the winter high season (December through March), travelers flock to escape cold weather and enjoy Waianae’s beaches and whale-watching (February occupancy often reaches the mid-80% range). Summer (June–August) is another peak, aligned with school vacations – July and June in particular have the strongest monthly performance, as evidenced by high RevPAR and ADR during those months. In contrast, a noticeable dip occurs in the fall (September–October), which is Hawaii’s typical shoulder season. For example, September occupancy can drop to ~72%, and monthly revenues trough accordingly. Still, even in the slower fall period Waianae’s occupancy remains relatively healthy by industry standards, thanks to limited competition and steady leisure travel. Overall, the submarket exhibits pronounced seasonal swings (Seasonality score 99/100), but with profitable highs that more than compensate for the quieter months. Year-round, demand has remained high despite gradually rising supply, indicating that new listings are quickly absorbed by the market. In short, Waianae’s performance trajectory is strongly positive, combining double-digit revenue growth with consistently high occupancy – a rare feat indicating an undersupplied high-demand market.

Supply Structure and Composition

Inventory size and growth: As of mid-2025, the Waianae Coast has roughly 266 active short-term rental listings, about a 9% increase from the prior year (reflecting new entrants to the market). However, the effective supply of unique properties is lower than this figure suggests. Many properties are cross-listed on both Airbnb and Vrbo, inflating the listing count. In fact, one analysis notes only about 120 distinct rental properties in Waianae. This is surprisingly low given Oahu’s popularity, and it means hosts face far less competition here than in the island’s urban hubs. The channel mix underscores this: approximately 41% of rentals are listed on both Airbnb and Vrbo simultaneously, while about 38% operate solely via Airbnb and 21% solely on Vrbo (indicating a notable Vrbo presence, likely due to larger beach house rentals doing well on that platform). The net effect is a constrained supply of rentals relative to demand – a key factor behind the high occupancy rates and pricing power enjoyed by local hosts.

Property types: The Waianae STR inventory is overwhelmingly comprised of entire-home rentals. Around 98% of listings are whole units (entire houses or apartments), with only a scant 2% being private room rentals. This reflects the market’s focus on accommodating families and groups seeking a standalone vacation home experience. Many Waianae Coast rentals are single-family beach houses or condos that offer exclusive use of the property. In terms of size, there is a diverse bedroom mix, but a significant portion of the stock leans toward either small one-bedroom units or larger multi-bedroom villas. AirDNA data show about half of listings are 1-bedroom (likely condos or ohana units suited for couples), while roughly 35% are in the 3–4 bedroom range (spacious homes for groups), and the remainder 2-bed or 5+ bed. This mix allows the submarket to serve a range of traveler groups, from solo vacationers to large families. Notably, the prevalence of larger homes aligns with Waianae’s appeal to groups seeking an alternative to resort hotels – often multiple couples or extended families rent a big house together. As a result, the area’s average unit size and capacity are greater than typical urban STR markets.

Listing availability: A distinguishing feature of Waianae’s rental supply is that many properties are not rented year-round. Only about 31% of listings were available for bookings essentially full-time (271–365 nights per year). The rest are used on a part-time or seasonal basis by their owners. Indeed, approximately 41% of listings are available fewer than 90 nights per year, indicating a large share of owners rent their vacation homes only during peak seasons or when personally not in residence. Another ~28% have intermediate availability (90–270 nights). This seasonal hosting pattern is common in Hawaii’s resort areas, where owners might occupy homes for part of the year. It further constrains effective supply during certain months, contributing to tighter occupancy. The upside is that new investors or full-time STR operators have room to capture demand left unserved when many listings go offline in off-season. However, it also means market metrics (like “average revenue per listing”) include a mix of full-time and part-time rentals – those figures would be even higher if considering only fully available rentals.

Minimum stay and cancellation policies: Reflecting local regulations, a significant share of Waianae Coast rentals enforce longer minimum stays. About 43% of listings set a minimum stay of 30 nights or more. In many cases, these are hosts attempting to comply with Honolulu’s law (Ordinance 22-7) that forbids short stays in most residential zones. On the other end of the spectrum, roughly 30% of listings allow short stays of under 4 nights (with ~5% even allowing single-night bookings). These are likely either properties in allowable zones or hosts taking on legal risk to cater to the short-stay market. The remaining listings have moderate minimums (5–7 nights, etc.). In terms of cancellation policy, Waianae hosts tend to be stringent. An estimated 83% of listings use “strict” or very strict no-refund cancellation policies (including Airbnb’s Strict and Super Strict tiers, or custom policies). Only a small minority offer flexible or moderate cancellation terms. This suggests owners are confident in steady demand – strict policies help avoid revenue loss from last-minute cancellations, and guests are evidently willing to book under those terms given the market’s popularity and limited alternatives.

Demand and Booking Trends

Forward bookings and trip length: Guest booking behavior in Waianae reflects the planning of a destination vacation. The average lead time for bookings is around 82 days (nearly 3 months in advance), which has increased by ~12% from last year as demand has firmed. This long booking lead is well above the U.S. average and indicates that Waianae rentals are often booked far ahead, especially for high-season dates. Travelers eyeing a Waianae beach house for Christmas or summer are locking in reservations early. The typical length of stay is about 5.8 days per booking, or roughly 6 days. This is a bit longer than a standard hotel stay, consistent with vacation rentals attracting week-long family trips. It likely includes a mix of shorter weekend getaways and multi-week stays (especially with some hosts requiring one-week minimums or more). Notably, despite the many listings with 30-night minimums, the overall average stay remains under a week – indicating that those allowing short stays are indeed getting a steady stream of <7-night bookings. Guests who do book for a month or more (to comply with legal minimums) likely skew the mean upward, but many appear to still be booking for just a few days at available properties.

Occupancy patterns: Occupancy rates on the Waianae Coast are high throughout the year, and the market has shown the ability to absorb new supply without sacrificing occupancy. Even as the number of listings grew ~9% in the past year, the occupancy rate increased to ~78–81% on average. This implies that demand growth outpaced supply growth, a very positive sign. In peak months, many hosts report occupancy near capacity. Monthly occupancy typically tops out in the mid-80s percentage during the busiest periods (e.g., winter holidays and mid-summer). The seasonal low point comes in the fall; for instance, September’s occupancy in the low 70s% is the weakest month, when fewer tourists visit Hawaii. Still, a 70%+ occupancy in the slow season is enviable and underscores that Waianae has a strong base of year-round demand (e.g., attracting long-term stays, remote workers, or local staycationers even in quieter tourism months). Seasonality is evident but not crippling – the market stays more than half full even at its annual nadir, and nearly full at the peak.

High occupancy is achieved despite the fact that daily rates have risen significantly. The willingness of guests to book far in advance and pay increasing prices shows that Waianae has a robust demand pipeline. Traveler reviews often cite the area’s beauty and tranquility, suggesting many guests specifically seek out this location over more crowded parts of Oahu. Additionally, low competition (fewer listings) means each property captures a larger share of bookings. A data study indeed noted that Waianae’s ~81% occupancy was the highest of any Hawaii market analyzed, attributing it to the supply not keeping up with interest from guests. In summary, demand and booking trends point to an undersupplied, high-demand market where guests plan well ahead and fill most available nights, yielding consistently strong occupancy performance for hosts.

Revenue and Rate Trends

Waianae Coast short-term rentals generate excellent revenue, especially for larger properties, thanks to a combination of high rates and solid occupancy. According to AirDNA, the average gross revenue per listing over the past year is about $103.9K, which is an exceptionally high figure (for context, it’s roughly double the typical U.S. STR’s revenue). In fact, another source reports an average of ~$139K annual revenue in Waianae, which likely reflects only the fully active, higher-end properties. Either way, six-figure incomes are the norm here, and top performers significantly exceed that.

A key insight is the disparity in earnings by property type. Larger single-family homes massively outperform smaller condos or studios. An average house listing on the Waianae Coast earns around $150K per year (many 4–5 bedroom beachfront homes comfortably gross well above this). This is driven by higher nightly rates – luxury oceanfront houses can command $500–$800 per night in peak season – and strong occupancy from families and groups willing to pay for a premium private stay. In contrast, a modest apartment or ohana unit (often 1-bedroom) might earn on the order of $40K–$50K a year. This still represents a healthy return, but clearly the big revenue lies in catering to the upscale family/group segment. The large gap (houses earning ~3× more than small units) reflects both the property size premium and the fact that many smaller units may be owner-occupied part of the year (limiting their rental days). For investors, this suggests focusing on larger homes in this submarket can yield significantly higher cash flows.

Rate dynamics: The Average Daily Rate (ADR) in Waianae has been climbing and now stands around $431 on average (up 15% YoY). This is among the highest in Hawaii and well above most mainland markets. Furthermore, peak season rates breach the $500 mark. During the busiest months (e.g., December holiday weeks and mid-summer), ADRs commonly range from the high-$400s into the $500s. One analysis found Waianae’s average ADR around $517/night, indicating how strong rates can get when demand is maxing out. Even shoulder-season rates remain relatively elevated (the lowest ADR in fall still hovered around the high-$300s). Such pricing power is a function of the limited supply (few alternatives for consumers, especially for large beach homes) and the premium nature of Hawaii as a destination.

RevPAR and seasonality: Revenue per available rental (RevPAR), which combines occupancy and ADR, vividly illustrates the market’s seasonality. Weekends and peak months deliver outsized returns. On average, weekend nights (Fri–Sat) enjoy a RevPAR roughly 10–15% higher than midweek, translating to about $350 on a typical weekend night versus ~$300 on weekdays. This weekend premium confirms that short leisure trips (weekend getaways) are a significant contributor to earnings. More dramatically, on a monthly basis RevPAR swings from about $270 at the low point to over $450 at the peak, nearly a $200 difference.

As shown above, December–January and June–July are the lucrative peak periods with RevPAR in the $400–$450+ range (thanks to either holiday tourism or summer family vacations). The trough comes in September (post-summer, pre-holiday lull). The steep contrast underscores why Waianae earned a 99/100 Seasonality score – hosts must manage revenue across boom-and-bust cycles each year. Effective dynamic pricing is essential: operators raise rates aggressively for high-demand dates and offer discounts or value-adds in the off-season to maintain occupancy. Many will also require longer minimum stays or charge premiums around holidays to capitalize on peak demand. The good news is that even the “low” season is profitable; a September RevPAR of ~$270 is still quite solid and likely enough to cover costs, given Hawaii’s consistently strong base demand. Overall, Waianae’s rate and revenue trends show a market that can deliver very high income during peak times and remain steady in slower times – a desirable profile for revenue management.

Regulatory and Investment Considerations

Legal environment: Short-term rentals on the Waianae Coast fall under Honolulu County’s strict regulatory framework. Honolulu Ordinance 22-7 (enacted 2022) essentially prohibits rentals under 30 days in most non-resort residential areas. In other words, any rental offering stays of less than 30 consecutive days must be located in designated resort zones or have a rare nonconforming-use certificate. The Waianae Coast is largely zoned residential, not resort, so by law STRs here should operate on a 30-day minimum stay basis (effectively making them monthly rentals, often termed “30-day rentals”). The city backs this with heavy enforcement: the ordinance established steep fines for illegal short rentals (up to thousands of dollars per violation) and mandates that STRs be registered with the county.

However, a recent federal court ruling (Dec 2023) added a twist. The ordinance had originally attempted to redefine “short-term” as under 90 days (up from 30), thereby outlawing 30–89 day rentals as well. This was challenged in court by a group of rental owners. The judge issued an injunction preventing the 90-day minimum from being enforced, at least for those existing operators in the lawsuit. The ruling essentially upheld the traditional 30-day minimum (grandfathering in those owners to continue with 1–<30 day stays not allowed, but 30+ day stays permitted as before). Importantly, the injunction was limited – it did not legalize new <90-day rentals broadly, but it protected certain existing ones under prior rules. As it stands in 2025, the city continues to enforce the <30 day ban, and the 30-day minimum is the practical rule for the Waianae area STRs. The Regulation score of 70/100 for Waianae reflects this relatively strict environment. By comparison, many mainland markets with no STR ban would score higher, but Honolulu’s rules temper the otherwise stellar metrics of this submarket.

What does this mean for hosts and investors? Primarily, compliance is crucial. Operating an STR in Waianae legally means adhering to the ≥30-night stay rule, unless one of the few exempted situations applies (e.g. a B&B in an owner-occupied home with a hard-to-get permit, or properties within certain apartment zones). The data shows many hosts have adjusted accordingly – as noted, 43% of listings now set 30-night minimums, signaling an attempt to follow the law. Others may still be offering short stays under the radar, but that carries risk of enforcement. Prospective investors should plan for a strategy that either targets mid-term vacation renters (30+ days) or be prepared for uncertain enforcement if doing shorter stays. It’s worth noting that a sizable segment of Hawaii visitors (e.g. “snowbird” retirees, traveling nurses, remote workers) do book multi-week or monthly stays, especially on the quieter west side, so the 30-day model can be viable.

Investability and returns: From an investment standpoint, Waianae shines. It earned an Investability score of 92/100, reflecting a combination of relatively affordable property prices and high rental returns. Unlike Honolulu’s resort areas where home prices are sky-high, the Waianae Coast’s real estate has historically been more affordable (it’s a local residential community with lower price points). The average home price in Waianae is around $580K–$680K depending on property type – roughly 30–40% lower than the Honolulu metro median (which is near $950K). This lower barrier to entry amplifies returns: for example, with average gross revenue per rental of ~$100K+, the gross yield (revenue/price) can easily exceed 15%. One analysis highlighted an average revenue of $139K against a ~$684K home price in Waianae, calling it a “high-reward opportunity” rare in Hawaii. Indeed, such figures are nearly unheard-of in traditional long-term rentals or even other STR markets. This explains the strong interest from savvy investors and even institutional players for Hawaiian STRs. Waianae’s lack of saturation (few listings) also means a new entrant can capture demand without immediately facing a price war or oversupply conditions.

Strategic considerations: Investors looking at Waianae should keep a few strategies in mind:

• Legal compliance and risk management: Ensure the property can be used as a vacation rental and decide whether to operate on 30-day rentals (to comply) or take a calculated risk on shorter stays. Given Honolulu’s active enforcement (including neighbor hotlines for reporting illegal rentals), a compliant strategy is advisable for stability. Budget for obtaining proper registration or permits if available, and consult legal counsel on the latest regulatory status (which can evolve with ongoing litigation and legislation).

• Property type and amenities: Focus on larger entire-home properties if possible. As demonstrated, 4+ bedroom beach houses with amenities (ocean view, pool, AC, modern finishes) capture the highest ADRs and occupancy. They appeal to the lucrative family/group segment that can’t be served by hotels on this coast. Smaller condos can still perform but may not maximize the market’s potential. Properties that stand out – whether via direct beach access, renovated interiors, or added perks (kayaks, outdoor lanai, etc.) – will likely command premium rates and reviews.

• Dynamic pricing and seasonality management: Given the extreme seasonality, owners should employ dynamic pricing tools and strategies to optimize revenue. This means aggressively increasing nightly rates for holiday weeks, summer weekends, and special event periods, while lowering minimum stay requirements or offering discounts in slower months to boost occupancy. Many successful hosts implement longer minimum stays or higher base rates for peak season, then allow shorter stays and deals in off-peak to ensure the property isn’t sitting empty. Revenue management is key to take advantage of Waianae’s high highs and to cushion the low periods.

• Financial planning and reserves: The flip side of seasonality is cash flow variability. Investors should plan for lower income in shoulder seasons – ensure adequate reserves to cover mortgages and expenses during slow months. The high peak season income will ultimately make up for it, but prudent budgeting is needed. Also, factor in Hawaii’s higher operating costs (utilities, GE/TA taxes, housekeeping, etc.) and potential new taxes – for instance, Honolulu has increased property tax rates for non-owner STR homes. High margins in peak season should be set aside to cover these costs year-round.

• Awareness of enforcement and community relations: With STRs being a contentious issue in Hawaii (concerns about housing affordability and community impact), operators should stay informed on enforcement crackdowns or rule changes. For example, the city may step up inspections or implement new tax classes for STRs. Being a good neighbor is also crucial – adhering to quiet hours, occupancy limits, and being responsive can prevent complaints that draw regulatory attention. In the wake of events like Maui’s post-wildfire housing crunch, there’s political pressure on STRs statewid. Investors should have contingency plans (e.g., ability to pivot to 30+ day rentals or long-term tenants) if regulations tighten.

In conclusion, the Waianae Coast STR submarket presents a compelling yet nuanced opportunity. Its combination of natural allure, limited competition, strong financial metrics, and high demand make it one of the most attractive places in the country for short-term rental investment. As noted in industry analyses, Waianae’s “numbers are eye-opening” and represent a rare case of moderate home prices paired with extraordinary rental income. The market’s success is underpinned by macro trends – the enduring popularity of Hawaiian vacations and the preference for rental homes – and by local factors like the dearth of hotels on Oahu’s west side. While regulatory constraints require careful navigation, those who operate within the rules can reap substantial rewards. By investing in the right property and employing professional management practices, an STR owner in Waianae can achieve high occupancy, premium rates, and attractive returns that outshine many traditional markets. The Waianae Coast thus stands out as a high-potential, top-performing submarket in the U.S. STR landscape, meriting serious consideration from investors seeking both profitable and resilient vacation rental opportunities.

Sources:

• AirDNA Market Data and Analytics for Waianae Coast, Oahu (2024-2025)

• Honolulu Dept. of Planning & Permitting – Short-Term Rental Regulations (Ordinance 22-7)

• Courthouse News Service – Judge Rules on Honolulu Short-Term Rental Ordinance (Dec 2023)

• SummerOS Investor Insights – “Best Airbnb Markets in Hawaii 2025” (Waianae section)

• RedAwning STR Report – Top 10 Airbnb Arbitrage Markets (Waianae, HI profile)

• Credence Research – U.S. Vacation Rental Market Trends (institutional investment, traveler preferences)

• MyLighthouse Blog – State of the Short-Term Rental Market 2025 (industry growth and demand shifts)