As reported by The Garden Island, Hawaii’s visitor industry entered 2026 still operating below its pre-pandemic peak, with new forecasts suggesting another year of modest growth rather than meaningful expansion. According to economists and tourism leaders speaking at the 2026 annual outlook forum, Hawaii welcomed 9.64 million visitors in 2025, down 0.6% from the prior year and well short of the 10.4 million visitors recorded in 2019 .
While visitor spending increased 5.7% to $21.75 billion in nominal dollars in 2025, industry leaders described the market as stabilizing rather than growing.
2026 Forecast: Slow Gains, Not a Surge
The state Department of Business, Economic Development and Tourism (DBEDT) projects arrivals to rise just 0.7% in 2026 to 9.76 million visitors, with spending expected to increase 2.4% . Growth through 2027 and 2028 is forecast to remain incremental.
Speakers noted that Hawaii’s recovery has become increasingly “K-shaped,” with high-income travelers continuing to spend while middle- and lower-income consumers pull back . Luxury properties are performing better, but midscale and upscale segments are facing pricing pressure.
Rising Global Competition
One of the more notable themes was intensifying international competition. Travel data presented at the forum showed limited airlift growth for Hawaii in 2026, with most seat increases coming from U.S. mainland routes. Meanwhile, international air capacity from Japan, South Korea, Canada, and Australia is projected to decline.
Destinations such as Mexico, Fiji, Thailand, Bali, and French Polynesia are increasingly capturing traveler interest, often offering lower costs and aggressive marketing. Honolulu did not rank among the top 10 most-searched or most-booked U.S. destinations for the coming travel cycle, signaling competitive pressure.
Maui’s Ongoing Impact on the Statewide Market
Maui remains a central factor in Hawaii’s overall tourism outlook. Economists pointed to continued economic strain following the 2023 wildfires and the uncertainty surrounding Bill 9, which proposes phasing out more than 6,200 short-term rental units in South and West Maui to convert them into long-term housing .
Discussion of Bill 9 alone reportedly contributed to a 30% drop in median Maui condominium values as investors reacted to potential reductions in lodging supply . Analysts estimate the state has been losing billions annually in tourism receipts since the wildfires.
Implications for Kauai Real Estate and the Hawaii Property Market
For those monitoring Kauai real estate trends, Hawaii tourism forecasts, and property investment opportunities, this outlook reinforces several key themes:
-
Hawaii remains below its pre-pandemic visitor peak.
-
Luxury travel segments continue to outperform.
-
International markets, especially Japan and Canada, remain soft.
-
Mid-market hospitality and tourism-related small businesses face ongoing pressure.
-
Competitive global destinations are gaining traction.
From a real estate perspective, this environment may continue to support demand for luxury oceanfront homes in Kauai, resort-area properties, and high-end second homes, while broader tourism softness could influence workforce housing, condominium markets tied to vacation rentals, and smaller tourism-dependent commercial sectors.
As Hawaii moves through 2026 in what economists describe as a “holding pattern,” the long-term trajectory for the Kauai housing market, vacation rental investment, and resort real estate will likely hinge on international recovery, marketing investment, Maui’s policy direction, and broader U.S. economic performance.
- - - - - - - - - -
For more local news and Kauai real estate information, contact us at:
Sean Ahearn, Billy Eckert & Jim Karlovsky
[email protected]
(800) 808-6373