Category: Moving to Hawaii

Things you need to consider before moving to the Aloha State.

Kohala Ranch Property Taxes

Posted on by JUDY HOWARD

Kohala Ranch has amazing views, a great climate, and wonderful homes.

As a Realtor, I get many inquiries about Kohala Ranch. People fall in love with the expansiveness of the area, the views. and the climate. The lots are large, ranging in size from about 3 acres on up to about 12 acres, and prices tend to be affordable for the area, although complying with the design rules can make building expensive. There are a number of homes for sale, many of which have luxurious amenities, and the prices are, again, relatively affordable. It is fairly close to Waimea, and both prep schools located there, but it is also far enough away, and private and safe enough, to seem like a wonderful retreat from the daily bustle. https://hawaii.elitepacific.com/results-gallery/?hood=3374513

Kohala Ranch no longer has a dedicated agricultural use classification for property tax purposes.

A couple of years ago, the Kohala Ranch HOA board decided to prohibit cattle grazing on the ranch. That decision led to the revocation of the dedicated agriculture classification for property tax purposes. (The Ranch is still zoned for agriculture uses, so all of the uses that were previously permitted are still permitted by the County.) http://livinginwaimea.com/2018/10/12/land-use-in-agriculturally-zoned-areas-on-the-big-island/

The dedicated agriculture designation reduces the assessed value of land to rock bottom. Thus, even though the tax rate remains the same as other agriculturally-zoned land, it is applied to much lower values, resulting in much lower taxes.

The loss of the dedicated agricultural use classification has increased property taxes on some parcels.

Now the agricultural rate is applied to market value, rather than dedicated agriculture value, unless individual owners have applied for and received non-dedicated agriculture status from the County Real Property Tax office. Under this program, owners must show that they are engaged in ranching or farming. If they can demonstrate such activity, they will be entitled to a much lower assessed value, although not as low as lands in the dedicated agriculture program. Also, the lower assessed value will be limited to the land devoted to the agricultural endeavor-so if you have a pool, tennis court, and pasture for cattle, only the pasture will be entitled to the lower assessed value.

If you don’t want to farm or ranch, you may still qualify for lower taxes if you can qualify as a homeowner.

Another option some owners have pursued is to be classed as homeowner, rather than agriculture, because a) the tax rate is lower and b) property tax increases are limited to no more than 3% a year. In order to qualify for this classification, the property must be the owner’s primary residence.http://www.hawaiipropertytax.com/tax_rates.html

If you are considering a second home, and offering it as a vacation rental to offset some of the costs, you should probably look elsewhere.

The County of Hawaii has just passed a stringent vacation rental bill, and unless a property in Kohala Ranch has a history of lawfully operating as a vacation rental, it will not be a permitted use. See my post:
http://livinginwaimea.com/2019/03/30/hawaii-county-restricts-vacation-rentals/

Kohala Ranch has undergone some changes, but it is still a lovely place to live!

I would be delighted to provide you with more information about properties in Kohala Ranch. You can reach me by phone at (808)885-5588, or by email at judy.howard@elitepacific.com. Aloha.

Hawaii County land use restrictions for agriculturally zoned land.

Posted on by JUDY HOWARD

It is beautiful, but it is not for everyone!

Hawaii County is a place of great beauty and vast open spaces.  But it is also a place where the goals of food self-sufficiency and diversified and sustainable economic growth are taken seriously. At the moment, the County is heavily dependent on tourism, which leaves us in a precarious position when visitor numbers drop for any reason.  We also import an appalling percentage of our food, which leaves us vulnerable to vagaries of labor strikes and natural disasters.

Land zoned for agricultural use, Hawaii County.
Hawaii County and the State restrict use of agriculturally zoned lands

Agricultural lands receive favorable tax treatment.

First and foremost, the property taxes on land in agriculture are much lower than those on land used for residential purposes.  The actual rate is higher for some agricultural land than it is for some residential land, but the assessed values to which those rates are applied results in significantly lower taxes.  Grazing land, in particular, is assessed at about $10,000/acre for non-dedicated land, and is currently taxed at $9.35/$1000.  Homeowner rates are currently $6.15/$1000 of assessed value, but the land and improvements are assessed at market value. Also, those low homeowner rates apply only to primary residences, not to second homes or homes held for income or investment.  Rates are available here: http://www.hawaiipropertytax.com/tax_rates.html

So what constitutes an agricultural use, and where is County land use policy headed?

You can access a handy chart showing the permissible uses of land zoned in various ways here: http://www.hiplanningdept.com/wp-content/uploads/2017/09/Permitted-Uses-Table-091917.pdf

Some of the uses listed in the chart don’t do much to increase food production.  There is obvious value in keeping land in agricultural use, in the sense that it is much easier to later convert open land to food production than it is to restore land that has been used for residential, commercial or industrial purposes so that it can be safely used for such production.  But given the growing emphasis the State is placing on a diversified economy and food self-sufficiency, it is reasonable to expect increasing restrictions on use of agriculturally productive land for purposes other than food production and commercial agriculture.  The days during which a developer could easily purchase a pasture, get it rezoned and subdivided, and build and sell houses, are gone.

Current restrictions on use of agriculturally zoned land.

Even now, the number of dwellings, and the type of occupants of dwellings, are restricted on some agricultural lands.  Some lands are governed by the State Land Use Commission, and lands classified as less productive are subject to County regulation.  This is a huge topic, and while I could post links to every source that would need to be consulted in order to make a determination as to the governing body and restrictions on a given parcel, I instead advise anyone considering a purchase of agriculturally zoned land in Hawaii County to consult with the Hawaii County Planning Department.  Have the TMK of the parcel you are considering, and a planner should be able to outline for you all of the permitted and prohibited uses for that land.  See also http://livinginwaimea.com/2019/03/29/kohala-ranch-property-taxes/

Don’t plan on paying for your agricultural land purchase by selling agricultural goods!

If you want to make a profit on agriculture in Hawaii, your options are even more limited.  Some crops do reasonably well in some years, but given the cost of land, it is very difficult to thrive as a farmer or rancher in Hawaii, year in and year out.  Nonetheless, there are quite a few ranchers and farmers here.  Why?  Because even though it is very hard work, it is also endlessly interesting and occasionally very rewarding!

What is there to do?

Posted on by JUDY HOWARD

Mauna Kea in the distance

What is there to do in the Waimea area?  We have beaches, which are both beautiful and offer almost endless opportunities for fun.

We have golf courses, and many places to hike.

We have whale watching, canoe paddling (and combining those two is a sublime experience), and scuba diving.

You can surf, wind surf, SUP, fish, or hunt for birds or pigs.

We have rodeos, polo, and cutting and reining competitions, along with various other clubs for other riding disciplines.

We have glorious farmers markets, and many excellent restaurants.  We have a theater, and talks sponsored by the two observatories with offices in town.

There are many houses of worship, and lots of opportunties to volunteer or engage in civic activities.  It is sometimes not easy to figure out which organization needs which kind of help, but checking with the school offices and hospital is a good place to start.

But our cultural events are limited, we don’t have huge shopping malls, endless shopping choices, or massive movie complexes. People do move here and then move away, saying there “is nothing to do”.

What is there to do?  It depends on what you’re looking for. The Big Island is definitely more attractive to active outdoorsmen (and women) than to people who are accustomed to having multiple cultural events and shopping opportunities to chose from. It is also more attractive to those who are willing to forgo frequent visits with friends and family and are open to learning about different cultures and making new friends!

Big Island Weather

Posted on by JUDY HOWARD

Two of my rescue pups. One snaps with joy, the other tends to piddle. But you can see how green the grass is

It changes from minute to minute, and is different from place to place! I live on the “wet” side of Waimea, also euphemistically referred to as the “lush side”, “emerald side”, “green side” etc.  We tend to have wetter weather from January through September, but there have been many summers when we have suffered from drought. On any day of the year, it may sprinkle for a bit, and then the sun will come out.  At other times, such as last night, we can have torrential rain and wind.

We are on the windward side of the Island, while parts of Waimea are on the leeward side.  Those areas are much drier, but tend to have much more wind.  And not 20 miles from here, in Waikoloa, the County has been battling a brush fire for a couple of days. They had enough rain earlier in the year to promote growth of grass and brush, and now that is has dried, it has become fodder for fires.  The fire department has that one under control now, but they’ve closed a road connecting Waimea and Kona, leading to some serious traffic delays.

Recently I was driving up the Hamakua Coast from Hilo, and encountered blinding rains along the way.  When I got home, less than 15 miles from the area where it was pouring, everything was dry. Whether on the windward or leeward side, it varies from spot to spot, season to season, and day to day!