What will Big Island Property Taxes Cost You?

We put together a quick summary of how you can estimate your property taxes on the Big Island. Keep in mind that this is just a rule of thumb and your actual tax bill will vary.

This short clip came from our Aloha Friday Hawaii Real Estate Show which goes live every other Friday on our Hawaii Real Estate YouTube channel or our Living in Hawaii Facebook page

Get educated about Hawaii’s real estate from trusted experts with decades of experience.   Send us yours via the form below for consideration and make sure you give your name and location so we can give you a shout out if we decide to answer it!

Open form in mobile browser

 

Transcript:

uh dylan uh give us the quick overview
what’s uh how do you calculate the uh
how would you kind of go about some rule
of thumb stuff for calculating property
taxes on the big island
the first thing and i guess the hawaii
county property tax people aren’t as
smart as maui because ours is way
simpler to understand so
the first thing is
they confuse you by doing this like you
know
eleven dollars per one thousand dollars
of tax assessed value really really you
just move the decimal point one time to
the left and it’s a percentage now right
so if you want to think about it like
how normal people think about taxes it’s
a percentage so so on all of these
numbers over here you just move it one
time to the left so for example the
residential uh rate or the second one
down if you one time to the left because
1.11 or one point uh
three what is that six percent so
that’s the one kind of confusing thing
is for the big island there’s two
different rates based on the valuation
so if it’s under two million dollars you
pay that one point one one percent but
the portion above two million dollars
you pay that one point three six percent
so that means if you have a two and a
half million dollar house you pay the
one rate on the two million dollars and
then on the 500 000 you pay the higher
rate um that’s kind of new they did that
last year i believe
but
really for the big island you have all
these different rates but the there
aren’t like short-term rental long-term
rent and all that stuff it’s either you
pay the residential rate which means
it’s not owner occupied or you pay the
homeowner rate the one all the way at
the bottom number nine and that means
you do owner occupy it so if you own or
occupy it you get a 180 000 exemption
off the assessed value
plus you pay the lower 0.615 so it’s
almost half the the tax rate is almost
half as if you pay the full residential
rate and you pay that full full
residential rate doesn’t matter how
you’re using it short-term rental
long-term rental second home whatever as
long as you’re not your primary
residence you pay that residential rate
so
that’s those are the two that’ll that’ll
you know affect most people all this
other stuff industrial commercial you
know you’re usually um not going to be
affected as a consumer unless you’re a
business owner and own that type of of
property
um yeah that’s kind of the the short run
down on property taxes on a big island
they’re not that complicated but the
important thing to understand is one
like heidi said how are you going to use
it because that’s going to affect the
rate and looking at a property
online today and you see what the
property tax rate is doesn’t mean it’s
going to be your property tax rate so
you do want to figure out okay how am i
going to use it and
the assessed value is almost always
going to go up once it sells because
that’s one of the things assessed value
very much lags the market so you could
be looking at a million dollar house
that’s assessed at 600 000 that has a a
homeowner’s exemption on it and so you
know the taxes may be like 1200 bucks
and look really cheap right but then if
you buy it at a million and then you’re
going to use it as a second home now
you’re going to pay 1.1
on
a valuation that’s going to be closest
to a million dollars because they’re
going to reevaluate that soon after soon
after the property sells so your tax
rate could be ten thousand dollars but
it could go from 1200 but today to
10 000 when when you actually take
ownership of it that’s a really good
point you really got to look at how it’s
going to be evaluated and what the and
what the what the rates