Faxing is quite uncommon nowadays. Most communication transpires through email, along with documents utilizing digital signatures via DocuSign® (http://docusign.com) where the paperwork is pre-filled with tabs so you only click with the mouse to initial, sign, and date.
The amount of down payment required depends on how you intend to use the property, (eg. primary residence, 2nd home, investment.)
Typical Down Payment Requirements:
- 0% VA
- 3 % FHA
- 3% - 3.5% HomePath
- 20% Conventional
- 25% Portfolio
- 3% - 10% HomePath
- 20% Conventional
- 30% Portfolio
- 3% - 10% HomePath
- 30% - 35% Portfolio
*Additional factors may affect down payment requirements. Your lender can help guide you through the various options.
200 days in Hawaii County (Big Island) to be eligible for residency. If you had your legal domicile in Hawaii for the whole tax year, or if you lived in Hawaii for at least 200 days (no matter where you had your domicile in this period), you are a resident of Hawaii. There are some exceptions, however: military employees and students are not considered residents if their domicile is outside Hawaii and if they resided in Hawaii for more than 200 days solely for educational or work purposes.
A rental term of at least 180 consecutive days.
Yes. However, there are strict requirements you must follow before traveling to Hawaii with animals, in addition to post-arrival quarantine.
Hawaii is rabies-free and the quarantine law is designed to protect residents and pets from potentially serious health problems associated with the introduction and spread of rabies.
All dogs and cats, regardless of age (puppies and kittens included) or purpose, must comply with Hawaii’s dog and cat import requirements.
Hawaii Administration Rules govern the importation of dogs, cats, and other carnivores into Hawaii. This law states that dogs and cats meeting specific pre-and post-arrival requirements may qualify for 5 Day Or Less quarantine program, which has a provision for direct release at Daniel K. Inouye International Airport (Honolulu) after inspection.
Furthermore, the law requires dogs and cats that do not meet all of the specific 5 Day Or Less program requirements to be quarantined for up to 120 days upon arrival in Hawaii.
Hawaii real property taxes are based on the fiscal year, running from July 1 - June 30 of the following year and are paid in 2 even installments: 1) Installment 1 is due August 20 (payment for July 1 - Dec 31 taxes) and 2) installment 2 is due February 20 (payment for January 1 - June 30 taxes of the following year).
Property taxes are based on assessed value, which is a value the tax office’s appraisal team determines a property is worth, which is different from market value (what a Buyer is willing to pay).
An appraiser at the tax office will typically review and analyze 5 comparable properties that have sold prior to July 1 of a given year (without actually visiting the property) and ideally not too many months prior to July 1 to determine what the value may be of a given property. The appraised value is the value on October 1 and since the appraiser only looks at sold data prior to July 1, the appraiser will also assess how much the market may have moved up or down in the 3-month period from July 1 to October 1 and use that as well in determining the property’s value on October 1. The assessed value on October 1 is used to calculate property taxes due the following fiscal year. Example: October 1, 2017, assessed value is the value used to determine property taxes for the fiscal year 2018, which runs July 1, 2018 - June 30, 2019. An owner can contest and appeal the assessed value in case an owner believes the assessed value is too high. *If you intend to appeal an assessment, make sure to have actual recent sold data to support your claim. Appeals can be filed online using this PDF form: RP Form 19-91 (Appeal Application)
For new construction, not completed yet, the appraiser will typically look at the costs of the building permits the developer takes out at the County of Hawaii’s Department of Planning & Permitting, which is normally a fraction of actual market value and a major reason why new construction oftentimes have 1-year or longer with property taxes that are substantially below where property taxes should be, based on market value. Example: If a new home is completed in May 2019 the property taxes for the fiscal year 2019 (July 1, 2019 - June 30, 2020) will be based on assessed value on October 1, 2018, which is a date prior to the house being completed, and there is a good chance property taxes will be low, relative to market value, since the assessed value is determined in great part based on the costs of the builder’s building permits. Come October 1, 2019, there will be sales data (at the least May 2019 original sales prices) and it is likely the assessed value for fiscal 2020 (July 1, 2020 - June 30, 2021) will be much closer to the home’s market value.
Hawaii County (Big Island) Property Tax Rates
|Property Class||Taxable per/$1000|
|Affordable Renting Housing||$6.15|
|Residential (less than $2M)||$11.10|
|Residential (more than $2M)||$13.60|
Review Property Assessed Values & Property Taxes
Click here to review the assessed value of any property in Hawaii County. Select “Yes, I accept the above statement” and then click “Search by Site Address” and you can enter Street Number, Street Name, and Unit Information.
Fee Simple (also known as Freehold) is the most complete form of ownership and most common throughout the United States and Hawaii. Fee Simple ownership includes the land and the buildings thereon. A Fee Simple condominium includes the actual condominium unit and the proportionate interest in the land underneath plus the proportionate interest in the common and limited common elements of the project. Common elements could include the lobby, elevator, walkways, swimming pool, etc. Fee Simple owners are responsible for their property taxes and sometimes association dues and or maintenance fees in the case of a condominium.
Leasehold ownership only includes the buildings, but not ownership of the land! A Leasehold condominium includes the actual condominium unit and the proportionate interest in the common and limited common elements of the project but not the ownership of the land. Someone else (the fee owner) owns the land and the Leasehold owner only leases (rents) the land at terms defined in the lease document. Prices for leasehold properties may appear very affordable, but remember, the price reflects a value without ownership in the land.
Potential buyers of leasehold property should proceed with caution with a full understanding of leasehold terms: Leasehold owners pay a monthly lease rent to the landowner. Per the terms of the lease, the lease rent could increase over time and is payable above and beyond the property taxes and any possible association dues or maintenance fees. Per the terms of the Lease, there may be restrictions on property usage, alterations, and maintenance.
Financing for Leasehold properties could be more difficult depending on how short the remaining lease term is. Generally, lenders require the lease to be at least 5 years longer than the loan term. So, a 15-year loan would tend to require at least 20 years remaining on the lease. The terms and details of the Lease can vary for different properties and the risks of ‘Step-Up Lease Rent’, ‘Lease Renegotiation’, and ‘Lease Expiration’ need to be carefully considered.
Tax Assessed Value
The tax assessor establishes an assessed value for the purpose of collecting the appropriate property taxes. Big Island assessed property values are established once every year on October 1 based on ‘comparable sales’ (similar size & location) that recorded prior to July 1st of a given year while also considering any market movements up until October 1.
The assessed value on October 1 determines taxes for the following fiscal year, which begins the following year on July 1. That means tax assessed values lag behind the real market value by at least one year. Note: The tax assessor rarely inspects the inside/condition of the property, which means the tax assessor may lack information to consider such as expensive upgrades versus original or even tear down condition. Additionally, the tax assessor does not adjust for gorgeous ocean views, beautiful landscaping, or property frontage.
For example, a property in Kona with great ocean views, spectacular landscaping, and stunning curb appeal might have the same tax assessed value as a ‘similar property on a nearby busy street with a dilapidated interior and no view of the ocean. While both properties might have the same tax assessed value, the true market value for both properties could differ substantially. Hence, one of the reasons why lenders don’t use assessed value in their loan calculations since it’s far from an 'accurate' or reliable indicator of the real market value.
The appraised value (appraisal) is a professional value opinion completed for a fee by a licensed appraiser, often hired by mortgage lenders. A licensed appraiser determines the appraised value by researching and comparing most recent (during the last few months) comparable sales (similar size & location) and uses certain predetermined detailed criteria to make adjustments for condition, upgrades, functionality, layout, etc. While appraisers have to be very detailed and follow specific formulas, 10 different appraisers still might come up with 10 different value opinions! Keep in mind, that appraisals are subject to the person performing the appraisal (appraiser), and even with a high degree of detailed analysis and specific formulas used for calculations, the end result can often be different from one appraisal to the next.
Real Market Value
The real market value is the price that a willing and able buyer pays for a property at that time. This could be affected by several market dynamics. For example, if two or more buyers are interested in the same property at the same time, it is possible that the property could sell at a higher price than otherwise.
A Foreclosure is when the lien holder (generally the bank) files legal documents to take possession of the property because the homeowner defaulted on their payment obligation. The process takes time and is costly for the lien holder, and therefore the bank’s last and least favorable remedy.
A Short Sale involves a lienholder willing to approve a sale even though the proceeds of the sale will not be enough to pay off the balance owed to the lien holder.
Banks will often prefer a Short Sale, where the bank (or lienholder) will accept less than the balance owed in order to avoid having to foreclose on the property.
The property owner will need to qualify for the Short Sale approval, by showing evidence of true financial hardship that makes it difficult to continue with the payment obligation for the property (job loss, income loss, etc.), and does not have the funds to make up the shortfall for the amount owed.
The lienholder typically orders an appraisal to determine the true market value and carefully scrutinizes the property owner’s financial hardship before approving the short sale.