Financing April 30, 2022

How to Calculate Property Tax

Most individuals are aware that owning a home entails a substantial financial investment. There is your mortgage, but the expenses don’t stop there. You will also be responsible for paying property taxes.

If you already own a home, you can look at your most recent property tax statement to see how your tax is calculated. If you’re thinking about purchasing a house, you can search for the assessment and tax information on the real estate listing, or go to the City & County of Honolulu Real Property Tax website to found out the annual property tax (

The City & County of Honolulu also provides a step-by-step on how to calculate real property taxes. Click here to view the link:

How are property taxes determined

When determining property taxes, a variety of factors are taking into account, including the assessed value of your home and the mill levy (tax rate) in your area. Here’s how to figure out how much property tax you’ll have to pay so you don’t get caught off guard.

A Home’s Fair Market Value

The market value of a home is the amount that a knowledgeable buyer would pay a knowledgeable seller for a property in an arm’s-length transaction with neither party feeling compelled to buy or sell. When a property is sold to a third party, the sales price is usually deemed to equal the property’s fair market value.

A Home’s Assessed Value

The value of your home is one aspect that influences your property taxes. Tax municipalities will utilize your home’s assessed value. Tax appraisers can calculate the current assessed value of a residence once a year. When a property is sold, bought, built, or remodeled, they may adjust information by looking at the permits and documents submitted with the local municipality.

They will look at basic attributes of your property (such as acreage, square footage, and the number of bedrooms and bathrooms), the purchase price when it changes hands, and comparisons with similar properties in the area.

The assessed value of a home may be surprisingly comparable to its fair market value, but this isn’t always the case, especially in hot markets. In general, you can expect your home’s assessed value to be between 80% and 90% of its market value. For a more precise amount for your home, you can contact the Honolulu tax office at (808) 768-3799.

You can contest the value of your home for tax purposes if you believe the appraiser has given it an excessively high value. You don’t need to pay a professional to assist with lowering your property taxes. As a homeowner, you may be able to present how you arrived at the conclusion that your assessed value is incorrect.

Taxable Value

Your home’s taxable value is the worth of the property as determined by your assessment, without any modifications such as exemption amounts.

Mill Levy

You will also need to know the mill levy, which is the real estate tax assessment rate in your area. The tax rate varies significantly depending on the public services provided and the amount of income needed by the local government.

Your property tax rates will be greater if you have a public school, police force, full-time fire department, desired school districts, and plenty of playgrounds and parks than if you don’t. After all, you get what you’re taxed for!