Hawaii County Property Taxes: What Big Island Owners Actually Need to Know

Updated September 18, 2026. County tax rates below apply to the fiscal year July 1, 2026 through June 30, 2027.

Yes, it’s true. Hawaii had the lowest effective property tax rate on owner-occupied housing in the country in the Tax Foundation’s analysis of 2024 U.S. Census Bureau data. Hawaii’s rate was 0.29%. New Jersey and Illinois were both at 1.88%. Texas was at 1.40%. California, which many of our Kona buyers come from, was at 0.70%, more than double Hawaii’s figure.

But here is what that headline number does not tell you: it is a statewide statistical comparison, not the rate you should multiply by the value of a Kona home to estimate its tax bill. Your actual bill depends on your property’s tax classification, taxable assessment, exemptions, and any other applicable benefits. Understanding those details can make a difference of thousands of dollars a year.

I have been selling property on the Kona and Kohala coast with Brenda Kuessner for several years now, and before that I spent 35 years as a real estate attorney. I also serve on the Hawaii County Tax Board of Review, which means I see up close the questions and concerns that property assessments raise for owners. I have reviewed a lot of tax bills. I have also sat with buyers who did not fully understand the Hawaii County system before they purchased and discovered later that their carrying costs were higher than expected. This post is my attempt to help, both for anyone who already owns here and for anyone considering a purchase.

Key Takeaways

• Hawaii’s 0.29% effective property tax rate is a statewide measure for owner-occupied housing. It is not a county tax rate or a reliable estimate for a second home.
• For fiscal year 2026–2027, Hawaii County’s homeowner rate is $5.75 per $1,000 of net taxable value, about half the residential Tier 1 rate of $11.10.
• Residential rates apply in portions: $11.10 per $1,000 on the first $2 million, $14.50 on the portion above $2 million through $4 million, and $17.00 on the portion above $4 million.
• The home exemption, homeowner tax classification, and 3% annual assessment cap are related but distinct benefits. Receiving an exemption does not automatically qualify a property for the homeowner class.
• Qualifying long-term rentals can receive a $7.75 rate. Eligibility includes a signed lease for at least six consecutive months to the same tenant or tenants and an annual application.
• Short-term rental use, including advertising, can affect homeowner benefits. Confirm the consequences for your parcel before listing it.
• The county extended the August 20, 2026 property tax payment deadline and certain dedication application deadlines to October 13, 2026.

The Number That Gets the Headlines

The 0.29% figure comes from the Tax Foundation’s 2026 property tax comparison, using 2024 American Community Survey data. Its state table calculates effective rates using total real estate taxes paid divided by total owner-occupied housing value. It does not measure the tax rate on second homes, rental investments, or commercial property.

For a simple illustration, applying those statewide percentages to a $400,000 value produces $7,520 at New Jersey’s 1.88% rate and $1,160 at Hawaii’s 0.29% rate. Those are arithmetic examples, not predictions of the bill on a particular home.

For a buyer, the useful next step is to leave the statewide comparison behind and look at the county rules for the actual property. A Kona home with $1,500,000 in net taxable value in the residential classification has a very different tax bill from what the national headline might suggest. How you use the property and which benefits it qualifies for matter enormously.

How Hawaii County Sets Your Tax Bill

Hawaii does not have a single statewide property tax rate. Real property taxation is administered at the county level, and the rules on the Big Island differ from those on Oahu, Maui, and Kauai. Hawaii County controls the classifications, exemptions, and rates discussed here.

For a property with one tax class and one applicable rate, the basic calculation is straightforward: subtract applicable exemptions from assessed value, divide the resulting net taxable value by 1,000, and multiply by the classification’s rate. For residential property above $2 million, calculate the tax separately for each tier and add the amounts together. Minimum taxes, credits, special assessments, and properties with multiple classifications can require additional adjustments.

The county assesses property annually as of January 1 preceding the fiscal tax year. Assessment notices are sent on or before March 15. Eligible properties may have assessment limitations or agricultural-use valuations, so assessed value is not always the same as current market value.

Hawaii County Property Tax Rates: Fiscal Year 2026–2027

July 1, 2026 through June 30, 2027. Rates are per $1,000 of net taxable value.

Source: Hawaii County Real Property Tax Office. The Council’s adopted-rate notice confirms that Resolution 574-26 was adopted on May 21, 2026.

The homeowner rate of $5.75 is about half the residential Tier 1 rate of $11.10. To isolate the effect of the rates, applying each to the same $800,000 taxable base produces a difference of $4,280 per year. A qualifying homeowner’s exemptions can reduce the taxable base further, as the example below shows.

What Changed in 2026: The New Tiered Structure

The Hawaii County Council adopted new rates for fiscal year 2026–2027 through a resolution introduced by Council Chair Holeka Inaba. That rate-setting action should be distinguished from the earlier legislation establishing the additional residential tier and long-term rental classification.

It lowers the homeowner and affordable rental housing rates. Both decreased from $5.95 to $5.75 per $1,000 of net taxable value. That reduces the tax on an unchanged taxable assessment, although an individual owner’s total bill can still increase if taxable value or other circumstances change.

It applies a third residential tier to the portion of taxable value above $4 million. The first $2 million remains at $11.10 per $1,000. The portion above $2 million through $4 million is taxed at $14.50, and the portion above $4 million at $17.00. These are marginal tiers: crossing a threshold does not put the entire value into the highest bracket.

In a March 4, 2026 report, Big Island Now quoted county tax administrator Lisa Miura estimating that the proposed third tier would affect 842 parcels, primarily in West Hawaii, with an estimated combined value of $5.3 billion. Those were estimates reported while the tier was being established. They do not, by themselves, establish how the change will affect property values in any particular community.

It sets a $7.75 rate for qualifying long-term rentals. The program requires a signed lease for six consecutive months or more to the same tenant or tenants. Residential-class property with net taxable value of $2 million or more is ineligible. Other conditions apply, including requirements for additional dwelling units on the parcel and annual application. This is not simply a matter of renting for 180 scattered days during a year.

According to Civil Beat’s May 2026 report, officials projected roughly $17 million in additional revenue, enough to cover an anticipated $15 million shortfall in 2028. The report connected growing debt service to required wastewater upgrades and said the county had received more than 800 long-term rental applications at that time. It also described Council member Jennifer Kagiwada’s alternative proposal, projected to raise about $30 million, which was not placed on the agenda. Those figures are dated projections and reported statements, not guarantees of future revenue.

What this means practically: qualifying homeowners and affordable rentals receive a lower rate, qualifying long-term rentals have another incentive, and residential property with taxable value above $2 million faces higher rates on the upper portions. Confirm your classification and taxable value rather than assuming last year’s bill will carry forward.

The Homeowner Exemption: The Most Important Thing to File

The home exemption reduces the assessed value on which your tax is calculated. The homeowner classification provides the preferential rate and a 3% annual assessment cap, subject to exceptions. These are distinct benefits: receiving the exemption does not automatically establish eligibility for the homeowner tax class. Rental and business uses can affect the result.

The county’s general guidance calls for owning and occupying the property as your principal residence for more than 200 calendar days per year and filing a Hawaii resident income tax return, Form N-11. You cannot claim another home or homestead exemption elsewhere. Conditional income-tax filing waivers are available in certain cases, including insufficient income to require a return and some newly relocated residents. The county requires documentation of ownership, residency, and age.

Home exemption amounts:

• Under age 60: $50,000
• Ages 60 to 64: $85,000
• Ages 65 to 69: $90,000
• Ages 70 to 74: $105,000
• Ages 75 to 79: $110,000
• Ages 80 and above: $125,000

The age-based amount replaces the $50,000 basic amount. It is not added to it. Qualifying homeowners also receive an additional exemption equal to 20% of assessed value, capped at $100,000, including qualifying owners under age 60.

For example, assume a 75-year-old owns an $800,000 assessed property, qualifies for the full home exemption, and qualifies for homeowner classification. Subtracting $110,000 and the additional $100,000 leaves $590,000 taxable. At $5.75 per $1,000, the annual tax is $3,392.50. An $800,000 residential property with no exemptions produces $8,880 at the Tier 1 rate. Under those assumptions, the difference is $5,487.50 per year.

The assessment cap is another significant benefit. In general, homeowner-class assessments cannot increase more than 3% annually, but a sale subject to conveyance tax can reset the assessment to market value, and improvements are treated separately. This is a cap on assessment increases, not a guarantee that the tax bill itself can rise by no more than 3%.

For the regular filing timetable, an application filed by December 31 can provide benefits beginning the following July 1; an application filed by June 30 can provide benefits beginning the following January 1. The benefit is not retroactive, and the seller’s exemption does not transfer to a buyer. Once approved, an exemption generally continues while eligibility remains unchanged. Report changes affecting eligibility to the county, and make sure your birth-date documentation is on file for age-based adjustments.

Sources: County homeowner program handout, new-owner information, and Hawaii County Code, Sections 19-53, 19-68, and 19-71.

What Non-Residents and Second-Home Owners Pay

This is where the conversation shifts for a large portion of our client base on the Kona and Kohala coast.

A property that is not your qualifying principal residence is not eligible for your home exemption on that basis. But there is no single “nonresident rate.” The property’s classification and use matter, and qualifying rental or other programs may provide different treatment.

For a second home in the residential classification, with no applicable exemptions, the current tiers are $11.10 per $1,000 on the first $2 million of net taxable value, $14.50 on the portion above $2 million through $4 million, and $17.00 on the portion above $4 million.

On a $1,500,000 net taxable assessment, that is $16,650 per year. On a $5 million net taxable assessment, the calculation is $22,200 on the first $2 million, $29,000 on the next $2 million, and $17,000 on the remaining $1 million, for a total of $68,200 per year.

These are legitimate differences in tax treatment, not necessarily evidence that an owner has filed something incorrectly. Every buyer should understand the carrying costs that follow from the property’s intended use before closing. For an eligible rental, the county’s long-term and affordable rental programs are worth reviewing.

The Short-Term Rental Classification Trap

This has caught property owners off guard, and it is worth addressing directly.

The county’s property-tax guidance says that renting any portion of a property for less than 180 days can disqualify it from the homeowner tax class and its assessment cap. Advertising can serve as evidence of rental use, even when an owner has not yet received bookings.

That does not automatically mean every vacation rental becomes Hotel and Resort or Apartment property. The resulting classification depends on the parcel and applicable rules. It also does not always eliminate every home exemption: a qualifying owner may retain an exemption on the portion of a principal residence that is not used as a transient rental.

If you rent a room or portion of your principal residence for six months or longer, you may retain homeowner benefits if the rental is within the main residence and the other requirements are met. A second dwelling, duplex, or accessory structure needs separate consideration. The county’s guidance also allows qualifying homeowner benefits where a separate long-term rental meets the Affordable Rental Housing program requirements.

Before listing a property, confirm its tax treatment with the Real Property Tax Office. Property-tax rules and permission to operate a rental are separate questions; the rental’s legal use must also be confirmed.

Source: Hawaii County’s rental and agricultural-use FAQ.

Other Exemptions and Programs Worth Knowing

Disability Exemption

Qualifying blind, deaf, or totally disabled homeowners can receive an additional $50,000 exemption. Form 19-75 and appropriate disability certification are required. Certain Social Security Administration documentation can substitute for physician certification as described in the county’s instructions. June 30 and December 31 filing dates apply to different payment periods. Review the official application for the evidence and timing that apply.

Disabled or Unemployable Veterans

Qualifying veterans who are 100% disabled, 100% unemployable, or both due to service-related injuries may receive an exemption on their qualifying home, except for 50% of the applicable minimum tax and special assessments. Commercially used portions do not receive the same exemption. Use Form 19-73 and the required Department of Veterans Affairs certification. See the county application and County Code Section 19-73.

Affordable Rental Housing

Qualifying affordable rentals receive the $5.75 per $1,000 rate for fiscal year 2026–2027. Owners must meet the program’s rental requirements and apply annually with supporting documents. Use the county’s applicable rent limits for the property and program year rather than an undated island-wide estimate. Applications are due by December 31 preceding the applicable tax year. See the county rental-program forms and instructions.

Long-Term Rental

The separate Long-Term Rental classification has a $7.75 rate for fiscal year 2026–2027. It requires a signed lease for at least six consecutive months to the same tenant or tenants and an annual application. Except for an owner’s principal residence, all dwelling units on the property must be leased. Residential-class property with net taxable value of $2 million or more is excluded, and short-term rental use is not allowed under the program. Review the county program information for the full requirements.

Alternate-Energy Improvements

County Code Section 19-82 provides an exemption for qualifying alternate-energy improvements, subject to its conditions. This is not a blanket exemption for every energy-efficiency upgrade. Confirm the treatment of the particular system and any application requirement with the county. See County Code Section 19-82.

Kuleana Land

Qualified kuleana land holders in Hawaii County pay the $200 minimum annual property tax. Eligibility requires lineal descent from the original recipient of title and the required verification. The Office of Hawaiian Affairs explains the program and ancestry-verification process.

Agricultural Classifications: Major Changes Underway

Hawaii County’s agricultural property-tax programs have been restructured. This matters particularly for anyone buying or owning a larger parcel on the Big Island. Agricultural zoning alone does not establish eligibility for an agricultural-use assessment benefit.

The nondedicated agricultural program is being phased out, with owners directed to apply for an alternative program. Qualifying agricultural properties can receive homeowner-class treatment alongside agricultural-use benefits, but the parcel must meet the requirements for both.

The three available agricultural pathways are:

Short-Term Commercial Agricultural Use Dedication: three years. This requires qualifying agricultural use and supporting documentation. Options include a farm plan, specified USDA certifications or an NRCS plan, or qualifying receipts documenting at least $10,000 invested in farm equipment, fertilizers, or soil amendments for the property. An application and county approval are required; a purchase receipt alone does not guarantee eligibility.

Long-Term Commercial Agricultural Use Dedication: ten years. Agricultural land is valued according to its qualifying use. The short-term program’s agricultural-use values are twice the long-term program’s corresponding values. Long-term dedication carries an ongoing commitment, documentation requirements, and potential rollback taxes if its conditions are breached.

Community Food Sustainability Use Assessment. The portion of land committed to qualifying community food production is assessed at 30% of fair market value. That percentage does not automatically apply to the entire parcel, dwelling, or other improvements. Owners should compare the actual taxable results of available programs before applying.

Sources: County Code Sections 19-57.1, 19-60, and 19-61 and the county agricultural-value schedule.

The county’s agricultural FAQ lists these minimum acreages for the short- and long-term commercial dedication programs:

• Intensive or diversified agriculture: 0.25 acre
• Orchards: 1 acre
• Feed crops or fast-rotation forestry: 2.5 acres
• Pasture or slow-rotation forestry: 5 acres

These are not absolute minimums for every agricultural program. A commercially viable operation on a smaller lot may qualify with an acceptable farm plan, and qualifying operations can sometimes meet acreage requirements through multiple parcels. See the county agricultural FAQ.

If a parcel also has rental activity, ask the county to review the combination of uses before assuming that homeowner classification or agricultural benefits will continue. The treatment of a home exemption, a preferential tax class, and dedicated agricultural land should be checked separately.

The county’s 2026 notice originally directed owners in the nondedicated program to apply for a new program by September 1, 2026. Its August emergency announcement subsequently allowed agricultural dedication applications to be filed by October 13, 2026. Confirm which application your parcel needs and how the relief applies; do not assume that all agricultural programs have identical filing rules. Sources: 2026 assessment insert and county deadline extension.

Key Deadlines to Keep on Your Calendar

• August 20: Ordinary first-half property tax payment deadline. For the payment originally due August 20, 2026, the county allowed payment through October 13, 2026 without penalty or interest.
• February 20: Ordinary second-half payment deadline. Check the county’s published payment instructions for the applicable year.
• December 31: Regular home-exemption filing deadline for benefits beginning the following July 1, and annual rental-program application deadline preceding the applicable tax year.
• June 30: Regular home-exemption filing deadline for benefits beginning the following January 1. Disability exemptions have their own payment-period rules.
• April 9: Regular deadline to appeal an annual assessment. An amended assessment generally has a deadline 30 days from the date of its notice.
• October 13, 2026: Extended 2026 deadline for the agricultural, native forest, and historical residential dedication applications identified in the county’s emergency announcement, as well as specified solar-water-heater and private-road tax-credit submissions.

Normal late-payment charges include a 10% penalty and 1% monthly interest. The 2026 emergency payment relief described above waives penalty and interest for payment within the extended period. See the county’s payment information and extension announcement.

Forms and property information are available through hawaiipropertytax.com. Match the form and deadline to the particular benefit you are seeking.

What to Do If You Think Your Assessment Is Wrong

In my experience, property owners sometimes underestimate the value of contacting the Real Property Tax Office with a specific question. A conversation can clarify an assessment or identify an error. It is also important to understand that an appeal has defined legal grounds and filing deadlines.

Step 1: Check Your Assessment Notice

The county sends annual notices on or before March 15 showing assessed value, classification, and exemptions. Check each of those items. For a valuation dispute, focus on evidence relevant to the January 1 assessment date, not simply what the property might sell for later in the year. A change in an owner’s financial circumstances, by itself, does not establish that an assessment is incorrect.

Step 2: Contact the Tax Office First

The county encourages owners to discuss questions with staff before filing an appeal. In some cases, staff may resolve the issue. Do not let those discussions cause you to miss the formal appeal deadline.

Kona office: West Hawaii Civic Center, 74-5044 Ane Keohokalole Highway, Building D, 2nd Floor, Kailua-Kona; (808) 323-4880. Hilo office: 101 Pauahi Street, Suite 4; (808) 961-8201.

Step 3: File a Formal Appeal

If needed, file Form RP 19-91, Taxpayer’s Notice of Appeal, with your Tax Map Key number and the nonrefundable $50 fee by the applicable deadline. Checks are payable to the Director of Finance. A separate appeal is required for each assessment year or each general land class on a multiple-class property.

The county’s overvaluation ground includes a more-than-20% threshold in the assessment-to-market-value comparison. A statement that an assessment is above market value by any amount is therefore incomplete. Other statutory grounds address unlawful or incorrectly applied assessment methods causing inequality, denial of an exemption for which all requirements are met, and illegal or unconstitutional assessment methods. Review the county’s exact wording and supporting-evidence requirements before filing.

Step 4: The Tax Board of Review Hearing

The Tax Board of Review consists of five community members appointed by the Mayor and confirmed by the County Council. Hearings are informal, but the owner must provide evidence supporting the appeal. Comparable sales, an independent appraisal, and accurate property information can help. The county describes decisions as announced at the hearing, followed by a written decision sent by certified mail.

Step 5: Tax Appeal Court

If you disagree with the Board’s decision, the county’s instructions provide 30 days from the date of the written decision to appeal to the Tax Appeal Court. Contact the court at (808) 539-4777 for filing information. Continue to pay taxes when due while an appeal is pending; filing an appeal does not suspend payment obligations.

Source for the procedure, deadlines, legal grounds, and contact information: Hawaii County’s official appeal instructions.

Frequently Asked Questions

Do I need to reapply for my homeowner exemption every year?

Generally, no. Once approved, the exemption continues while you remain qualified. Report changes in ownership, occupancy, or use that affect eligibility. Make sure the county has verified your birth date so age-based adjustments can be applied, and review your assessment notice each year. A buyer must file a new claim; the seller’s exemption does not transfer.

How does the new 2026 rate structure affect full-time residents?

The homeowner rate fell from $5.95 to $5.75 per $1,000 of net taxable value for fiscal year 2026–2027. That lowers tax on an unchanged taxable assessment. It does not guarantee every homeowner’s total bill declined, and full-time residency alone does not satisfy every requirement for homeowner classification.

What is the Tier 3 residential rate and who does it apply to?

For fiscal year 2026–2027, it is $17.00 per $1,000 on the portion of net taxable value above $4 million for property in the residential classification. Lower tiers still apply to the first $4 million. It is not automatically applied to an entire property just because its value exceeds $4 million.

What is the long-term rental tax class and how do I qualify?

The current rate is $7.75 per $1,000 of net taxable value. The program requires a signed lease for at least six consecutive months to the same tenant or tenants, an annual application, and compliance with the rules for all dwelling units and other uses. Residential-class property with net taxable value of $2 million or more is excluded. Confirm eligibility using the county’s application instructions.

Will the new rates affect property values in communities like Hualalai and Kukio?

Higher taxes change carrying costs, but the parcel-count estimate alone cannot establish the effect on sale prices. I would not promise that the effect will be negligible. Buyers should calculate the tax for the specific property and consider it alongside the other factors affecting their purchase.

What happens to my property taxes if I rent my home on Airbnb part of the year?

Short-term rental use, including advertising, can cause the loss of homeowner classification and its assessment cap. A qualifying owner may retain a partial home exemption for the nonrented portion, but the resulting tax class must be confirmed for the parcel. Talk to the Real Property Tax Office before listing.

I am buying a Kona property as a second home. How do I estimate my annual taxes?

Start with the parcel’s assessed and net taxable values, classification, and applicable exemptions. Apply the current rate to each taxable portion, including separate residential tiers when relevant. Ask whether the purchase will reset a capped assessment or end an existing benefit. The seller’s current bill can materially understate the buyer’s future tax, and purchase price and assessed value are not necessarily identical.

Can I appeal if the county reassesses my property significantly higher after a sale?

Yes, if there is a valid statutory ground. A sale subject to conveyance tax can reset a homeowner-class assessment to market value. A large increase from the seller’s capped assessment is not, by itself, proof of error. For an overvaluation appeal, review the more-than-20% threshold and provide evidence relevant to the January 1 assessment date. Observe April 9 or the applicable amended-notice deadline.

What is the difference between the homeowner rate and the residential rate?

The homeowner rate is $5.75 per $1,000 for qualifying homeowner-class property. Residential rates start at $11.10, with higher rates on portions above $2 million and $4 million. The homeowner rate is about half the first residential tier, and qualifying exemptions can further reduce the taxable value. Eligibility depends on the property’s ownership, occupancy, use, and required filings.

Sources for these answers: county rates, new-owner guidance, rental programs, appeal instructions, and County Code Chapter 19.

What This Means for Kona and Kohala Property Owners

Hawaii’s low statewide effective rate is a useful starting point, but it does not tell you what a particular Big Island property will cost to own. The difference between homeowner, residential, and qualifying rental treatment can be several thousand dollars a year. Correct classifications and timely applications matter.

The 2026–2027 schedule lowers the homeowner and affordable rental rates, sets a separate rate for qualifying long-term rentals, and raises rates on the upper portions of residential taxable value. Buyers should also account for the possibility that a seller’s capped assessment or exemption will not carry over after closing.

For buyers coming from California, Texas, or the Northeast, the right comparison is between actual estimated bills for the properties being considered. For buyers making the Big Island their principal home, homeowner benefits can make a substantial difference. For investors, the intended rental use and applicable program requirements belong in the carrying-cost analysis before the purchase decision.

If you are buying or selling on the Kona or Kohala coast and have questions about how property taxes affect your situation, that is exactly the kind of conversation Brenda and I have with clients before they close. The rules are public, but applying them to a specific property takes careful review. Feel free to reach out. We are happy to help you work through the questions and identify what needs confirmation with the county.

Sources are linked throughout. Rates are for fiscal year 2026–2027; national comparisons use the Tax Foundation’s 2024 data. Legislative reporting comes from Civil Beat’s May 2026 report and Big Island Now’s March 4, 2026 report. Deadline information includes the county’s August 18, 2026 emergency announcement. Information reviewed September 18, 2026.

Mark Davis, Esq. is a real estate broker (RB-23769) with Kona Homes for Sale at Coldwell Banker Island Properties, Kailua-Kona, Hawaii. He practiced as a transactional and litigation real estate attorney for 35 years before moving to the Big Island full time. He serves as a member of the Hawaii County Tax Board of Review. Brenda Kuessner holds the ABR, CRS, e-PRO, GRI, and GREEN designations and has sold real estate on the Big Island for 35 years. Together they serve buyers and sellers across the Kona and Kohala Coast market. This post is for general informational purposes only and does not constitute legal or tax advice. Confirm current rates, deadlines, eligibility, and your property’s classification with the Hawaii County Real Property Tax Office before making decisions.