Property values drop


POSTED: Tuesday, December 16, 2008

Most Oahu homeowners will see a drop in their 2009 real property assessments this week, which likely means lower tax bills next year.

On average, Honolulu residential property owners will see a 3.3 percent valuation decline, but North Shore properties' valuations plunged 9.3 percent, the biggest drop.

“;I'm so happy,”; said Mike Lyons, homeowner and North Shore Neighborhood Board chairman. “;It's a big help.”;

“;On a small area on the North Shore, we have a lot of people buying expensive homes, but the majority of the people have lived here for a long time—decades—and they're not selling their homes,”; he said, adding that most are humble homes purchased inexpensively years ago.

“;They're not making money off of their homes,”; he said. “;Yet with these high property taxes, it's a real burden for the retired people and the older folks.”;

The city's Department of Budget and Fiscal Services announced yesterday that its 2009 Honolulu property assessments are completed, and homeowners should be receiving them in the mail this week.

The property assessments going out this week are not tax bills, but notices of what the city believes the properties are worth. Property owners who disagree with an assessment have until Jan. 15 to file an appeal. The city's property tax bills will be mailed July 20.

Residential properties include all single-family houses, condominiums and apartments. The change excludes new inventory and construction, the city said.

People trying to sell their homes in these tough economic times might not be pleased with the lower valuations.

“;It's really hard to sell a property right now,”; said Realtor Patricia Bovard. “;This is bad news because buyers tend to look at the assessed values as market value.”;

Bovard predicts values will go up eventually because of the limited supply of real estate on the island.

Lower property assessments also mean lower tax revenues for the city.

“;It shows that this is reflective of the market we're in, and it sets the stage for the budget realities we're going to face come next March,”; said City Council Chairman Todd Apo. “;The reality is we continue to face rising costs that's out of our control.”;

Apo said one big expense that continues to grow is the post-employment benefits fund, which the city is required to fund. He said there are “;discretionary areas where we can cut back without taking away from core services.”;

However, the city says the total gross assessed value of all real property on Oahu went up a bit, by two-tenths of a percent, to $191.1 billion from $190.7 billion, thanks to new construction and improvements on existing properties. This increase will help offset the decline in residential property values.

Hotel and resort property values also decreased a tenth of a percent. The value of commercial and industrial properties grew 4.3 percent and 9.3 percent, respectively.

For more information on city property assessments and appeals, go to www.realpropertyhonolulu.com.