Legal Nonconforming in Real Estate – A Basic Explanation

Sometimes we hear a property or its use described as non-conforming or legal nonconforming rather than legal/illegal. Sometimes I also hear people use the word “illegal” when referring to structures or modifications, when they actually mean “unpermitted.”

These are important distinctions. What follows is definitely not legal advice by any means, but rather a lay personʻs guide to understanding the distinctions and their implications for you as a buyer, owner, or seller of real estate.

Historic movie theater in Hawi, Hawaiʻi was operating on a parcel now zoned “residential” – is it legal? Nonconforming?

Zoning Governs Uses; In Hawaiʻi State Land Use Districts Also Do

Real estate is subject to a variety of government legal restrictions detailed in statutes and ordinances (it may also be subject to restrictions that are private agreements like CC&Rs for a homeowners association). For reference, in this early post I describe how in Hawaiʻi, there is a state land use classification underlying each countyʻs zoning codes. And here is a post applying the state and county framework specifically to Big Island agricultural properties.

Nonconforming Means Structures and Uses that Predated Current Codes and No Longer Conform to Them

Legal nonconforming use is a use of the property that predated zoning, or was allowed in that zoning at the time it began but newer restrictions no longer permit that use. Mostly I have written about nonconforming use permits in the context of Hawaiʻi County (the Big Island) beginning to regulate unhosted short term vacation rentals in 2018. During the registration process in 2019, owners of unhosted vacation rentals whose homes were not in the designated zoning districts where transient rentals would still be allowed in the future could apply for a nonconforming use certificate. For those properties approved for the nonconforming use, as long as that use continued and annual permit requirements fulfilled, the nonconforming use runs with the property, even if ownership changes. However if the original or new owner allows the use or registration to lapse, then a new owner could not longer use the property as a short term vacation rental.

55-3345 AKONI PULE Hwy – historic Kahei theater used to show first run movies in Hawi MLS 715526

You may have noticed the unique listing I have with an old movie theater and a plantation-era home on the 2-acre lot that happens to have been zoned “residential” well after the theater was built and while it was still in operation (OH THE STORIES!!). I have had inquiries from local residents with dreams of once again showing first run movies in town. Inquiries from prospects wanting to run a gym or dance studio or art gallery. What I have to do is direct them to what the what Chapter 25 of the Hawaiʻi County Code says about allowable uses in residential zoning; as well as to the section on non-conforming uses.

Here is a summary of uses permitted in residential zoning:

Residential permitted uses per Hawaii County Code

And here is a summary of the rules regarding non-conforming uses – defined as a use that existed as of December 1996 that would not conform to the zoning restrictions today. Note that there are more rules and details in the county code, and one should refer directly to the code, the Planning Department, a planning consultant or land use attorney for specific questions.

• The nonconforming use may continue as long as it is continuous. If it ceases for a 12-month period, it may not be resumed.
• In order to resume that use after the use has been abandoned, all the requirements for obtaining special use permits would apply.
• A non-conforming structure (such as a commercial structure on a residential-zoned lot) may be maintained but may not be expanded; if it is damaged or destroyed such that to repair or restore it would cost 50% or more of its value, it may not be rebuilt except for a conforming use.

In other words, it may not be possible to restore the theater. And to have a new use would require that it conform with all existing code requirements, such as wastewater and parking.

Bottom line: a prospective buyer really needs to look to professionals for guidance about the pathway to continuing a non-conforming use, or for renovating a non-conforming structure.