While the overall assessed value of taxable properties on Oahu for 2024 didn’t skyrocket as it did a year ago, the city says the assessed value of homes in some parts of urban Honolulu are up by as much as 5%.
The city Real Property Assessment Division this week will distribute the 2024 real property tax assessment notices for the 2024-2025 tax year to property owners across Oahu.
The overall assessed value of taxable properties has increased from $343.07 billion in tax year 2023 to $345.77 billion in 2024. The more than $2.7 billion jump, a nearly 0.79% increase, is largely occurring among island homes, according to city Department of Budget and Finance Director Andy Kawano.
“Of the $2.7 billion increase, the majority, or $1.9 billion, is from the residential class,” Kawano told the Honolulu Star-Advertiser via email.
But city data also reveals properties located in rural versus urban settings appear to be experiencing a valuations divide.
In communities from Kahuku to Kaaawa, that means decreased property values of up to 4.2% this year over last. Likewise, Oahu’s North Shore and Leeward Coast share a 2.6% drop in their respective property values, the city says.
In Central Oahu, values are 1.4% less than last year, while Windward Oahu property values dropped by 2%, the city says.
Conversely, the value of taxable properties in urban Honolulu have risen — in some parts of town by as much as 5%.
And in other parts, from Salt Lake to Kalihi for example, property values rose by 2.3%, while East Honolulu saw a modest increase of 0.6%, the city says.
“Historically, the Oahu assessed valuations have increased 4% to 5% per annum on average as there is strong demand for residential property that is in limited supply on Oahu,” Kawano said.
Overall, the assessed values of properties in Oahu’s “Residential” classification increased from $230.04 billion in 2023 to $231.96 billion this year, an increase of about 0.83%.
But “Residential A” class properties — vacant land, condominiums, or property lacking a “home exemption” assessed at $1 million or more — decreased to $46.02 billion from $46.98 billion, a 2.04% drop, the city says.
Other types of property classes report similar changes to tax assessments.
Those includes the “Hotel and Resort” class, which increased by 0.06%, while the “Commercial” class rose by 0.14% over last year. However, “Industrial” property values decreased by 0.67%, the city says.
“These percentages represent island-wide classification totals and may not reflect the changes in valuation for an individual property or specific neighborhood as a whole,” the city states in a news release.
Tom Yamachika, president of the Tax Foundation of Hawaii, sees the latest real property assessments for Oahu as less alarming than last year’s 12% overall increase.
“It was shocking last year because we had double- digit increases,” Yamachika told the Honolulu Star-Advertiser. “I think last year was an anomaly.”
This year, he added, “Most of the island is facing decreases except for urban Honolulu.”
“What it probably means is that the properties in urban Honolulu are being looked at by buyers as being a little bit more valuable,” he said, “and that in the rural communities and suburbs there’s a little bit less of a market demand.”
Regardless, he noted that impacts remain as property taxes increase.
“If taxes go up then on rented properties, the landlords are going to pass some or all of the tax on,” Yamachika said. “But like I said, nothing shocking like last year.”
Meanwhile, the city Real Property Assessment Division announced Monday that the 2024 real property notices of assessment applicable to the 2024-2025 tax year will be distributed this week to property owners across Oahu.
On or before Dec. 15, the city says, it will distribute about 306,000 notices via the U.S. Postal Service or by email, for those who have subscribed to electronic delivery.
The notice of assessment is not a tax bill.
Instead, it provides the property’s ID/tax map key, assessed value, tax classification, applied exemption amount, applicable special assessment and net taxable value.
All 2024 assessed values reflect the value of real property in their entirety, or fee simple, as of Oct. 1, and are derived from sales of similar property through June 30, 2023.
Information stated on the real property notice of assessment is used to determine the real property tax bill amount, the city says.
The property’s net taxable value, which is stated on the notice of assessment, is taxed per $1,000 of value at the property’s applicable classification tax rate.
The Honolulu City Council will set tax rates for each property classification in June, and tax bills will be mailed in July.
According to the city, videos explaining the valuation process of residential properties and the appeal process are available for viewing at realpropertyhonolulu.com.
And many do file appeals.
Last year, Kawano said, there were 1,574 residential type appeals filed with the city over property taxes.
“And approximately 1,200 have gone through the Board of Review process this fiscal year,” he said.
To file an appeal, the city says property owners should call the Appeal Hotline at 808-768-7000 from Friday through Jan. 12, during business hours of 7:45 a.m. to 4:30 p.m., for assistance with any questions about their notices of assessment.
Inquiries may also be submitted via email to bfsrpmailbox@honolulu.gov.
Property owners who wish to dispute their real property assessment may file an appeal between Friday and Jan. 15.
>> Hand-delivered appeals must be received and accepted by 4:30 p.m. Jan. 12.
>> If the appeal is mailed, it must be postmarked on or before Jan. 13.
>> Appeals filed online at realpropertyhonolulu.com must be completed and submitted by 11:59 p.m. Jan. 15.
>> A $50 deposit for each appeal is required. Checks can be made payable to City and County of Honolulu. Enclose a self-addressed stamped envelope with the appeal application to receive a receipted copy of the appeal.
>> An appeal cannot be filed by fax or via email, the city says.
To expedite the appeal process and minimize the wait time for a Board of Review hearing date, appellants should submit any evidence and supporting documentation to the Real Property Assessment Division with the appeal form or shortly thereafter, the city says.
Generally, the city says appeals may include assessed valuation, denial of exemption, the property’s classification or a combination of the three.
Assessments, according to city laws, are deemed correct until proved wrong.
Based on the latest tax assessment, Kawano said he could not predict whether more or fewer appeals might be filed with the city.
“Many variables impact the number of appeals filed,” he said, “and it would be difficult to project an accurate number to be filed for the upcoming Dec. 15-through-Jan. 15 appeal cycle.”
Due to last year’s property tax increase that many claimed exceeded well over 10%, Mayor Rick Blangiardi’s administration and the City Council took steps to reduce the burden of property taxes on homeowners.
In particular, when Blangiardi approved the city’s $3.41 billion operating budget in June, the spending plan included a one-time $350 tax rebate granted to nearly 152,000 qualifying homeowners with an active home exemption on their 2023 assessment, regardless of property value.
