Owners at affordable condo to appeal after seeing their property taxes skyrocket

HONOLULU, Hawaii (HawaiiNewsNow) - Nearly 50 owners of affordable condos at an Ala Moana area highrise are appealing their city property tax assessments.

The owners of the units at 1631 Kapiolani Blvd. said the city is incorrectly using sales of nearby high-end condos to value their studios, which unlike market-priced units, have strict restrictions on resale.

“It was quite a shock,” said James Kawana, who owns a studio on the 43rd floor of the complex and is appealing his assessment.

Last year, Kawana ― an employee at Hawaii News Now ― said he paid about $500 in property taxes for a studio the city valued at around $158,000.

This year, the city’s quadrupled his assessment to about $690,000, meaning that his property tax will be about $2,000.

“If I knew the tax assessment would go so high within the first couple of years of owning it, it would give me pause to consider (buying) something else,” said Kawana, who bought his studio in 2018.

Real estate expert Ricky Cassiday said owners rarely win property tax appeals. But because the city relied on market prices units to value affordable ones, it wasn’t an apples-to-apples comparison.

“They should have a good chance" of appealing, he said. “The comparables used in this case were not comparables."

City Councilwoman Kymberly Pine said she plans to introduce a bill next week to bar the city from using resales of market-priced homes to assess the property value of affordable ones.

She believes this practice could discourage affordable housing development.

“It’s not just unfair but it just doesn’t make any sense," said Pine.

The city says it will review the assessment for the project to see if the valuations are warranted. In the meantime, owners will have to go through appeal process.

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