What Are Property Taxes on the Big Island of Hawaii for Second Homes?
If you’re thinking about buying a second home on the Big Island, property taxes are going to be part of your monthly cost.
And this is where Hawaii is a little different from most mainland markets.
The short answer:
Property taxes in Hawaii are relatively low… but the rate depends on how you use the property.
How Property Taxes Work on the Big Island
Property taxes are set byHawaii County.
They are based on:
Assessed property value
Property classification (this is the big one)
That classification determines your tax rate.
Primary Residence vs Second Home
This is where most mainland buyers get surprised.
Owner-Occupied (Primary Residence)
Lower tax rate
Requires filing for a homeowner exemption
Non-Owner-Occupied (Second Home / Investment)
Higher tax rate
No exemption
If you’re buying a second home and not living in it full-time, you’ll typically fall into this category.
Typical Property Tax Rates (Approximate)
Rates can change, but here’s a general idea:
Owner-occupied:lower tier rates
Second homes / non-owner occupied:higher tier rates
Vacation rentals:may fall into their own category depending on use
Even at higher tiers, Hawaii property taxes are often still lower than many mainland states.
What This Looks Like in Real Numbers
Example:
A $800,000 condo in Waikoloa or Mauna Lani:
As a primary residence → lower annual tax
As a second home → higher annual tax
The difference can be noticeable, so it’s important to plan for it.
Why Hawaii Property Taxes Feel Different
Most buyers from the mainland expect taxes to be much higher.
But Hawaii:
Keeps rates relatively low
Adjusts based on property use
Uses assessed value rather than just purchase price
Still… your classification matters more than anything.
Real Buyer Scenario
A buyer from California purchased a condo in Waikoloa as a second home.
They assumed taxes would be similar to what they were used to.
Even at the non-owner-occupied rate, their taxes were still lower than their previous property.
But…
They hadn’t initially planned for the difference between primary vs second-home classification.
That’s where understanding this upfront helped them avoid surprises.
What Can Affect Your Property Taxes
Property value
Classification (primary vs second home)
Changes in county rates
Improvements to the property
Common Mistakes Buyers Make
Assuming taxes are the same as their home state
Not understanding classification differences
Forgetting to file for exemptions (if applicable)
Only focusing on purchase price
Are Property Taxes High on the Big Island?
Compared to many mainland markets…
No.
But they still need to be factored into your total cost.
Especially for second-home buyers.
FAQ
Are property taxes higher for second homes in Hawaii?
Yes, second homes are taxed at a higher rate than primary residences.
Can I lower my tax rate?
Only if the property qualifies as your primary residence and you file the proper exemption.
Do taxes change every year?
They can adjust based on property value and county decisions.
Next Steps
If you’re considering buying on the Big Island, it’s important to look at:
Property taxes
HOA fees
Insurance
Total monthly cost
Not just the purchase price.
Julie Wettstein is a trusted real estate broker specializing in buying and selling homes on the Big Island of Hawaii, with a focus on helping off-island sellers, second-home owners, and real estate investors navigate the unique Hawaii market with confidence.
With over 30 years of real estate experience, Julie provides expert guidance on pricing strategy, marketing exposure, negotiation, and the complexities of selling property in Hawaii—including HARPTA, FIRPTA, short-term rental regulations, and island-specific property considerations.
Known for her concierge-level service and strong negotiation skills, Julie helps clients maximize value while removing stress from the selling process—whether they are on-island or managing their property remotely.
If you’re thinking about selling your home on the Big Island of Hawaii or want a clear strategy to get top dollar in today’s market, Julie is a trusted resource for expert advice and results-driven marketing.
Julie Wettstein, Broker RB-21086
Island Homes by Scuba Julie
Big Island, Hawaii
(808) 345-6934
BigIslandDreamHomes.com
[email protected]
