UPDATE: REALTORS and Homeowners Work Together To Abolish Unfair Property Taxes in Honolulu
Back in 2013 the way Oʻahu taxed property owners was significantly changed by the City and County of Honolulu. A new classification, Residential A, was put in place that required property owners to pay $6 for every $1,000 of their home’s appraised value vs. the former charge of $3.50 per every $1,000.
Residential A homes are ones that are valued at upwards of a million dollars, and are not occupied year round. This tax change meant that people who owned second homes, or investment properties would be paying almost twice as much as the average homeowner.
The reclassification caused rental fees to go up as owners tried to make up for the increase in taxes, a move that not only hurt rental property owners but had the potential to strike a blow to the island’s overall tourism appeal.
Most recently, Tax Appeal Court Judge Gary W.B. Chang overturned the property tax change, deeming it illegal and unconstitutional. This ruling means that close to 8,700 homeowners will no longer have to pay the inflated “Residential A” property tax as questions are also being asked about assessments from this past February’s property tax payments.
Hawaii REALTORS® are monitoring this as it makes its way through the processes.