HONOLULU (HawaiiNewsNow) - Homeownership is a dream for many, but with that dream comes the reality of paying for property tax.
People may be coming home from work checking their mailbox and finding their new property tax assessment. And chances are you will be paying more.
"Especially if you are retired and on fixed income property taxes could be a significant deduction," said Toy Arre, retiree.
Owners like Toy Arre, who happens to be a retired Finance Director, are getting their property tax assessments. The good news is home values are going up. The bad news is that means paying more in taxes.
"It doesn't affect only old people. It could be young families with children," said Arre.
Property tax does stand out with retirees. AARP Hawaii says nearly 260,000 people or 27 percent of Oahu's population is older than 55. There are also 143,000 or nearly 15 percent older than 65.
"The property tax is the single most burdensome tax for many low-income and older people. It affects older people directly as homeowners but also indirectly as renters, because landlords pass on at least part of any property tax in the form of higher rents," said Bruce Bottorff, AARP Hawaii Director of Communications.
"We are concerned about our seniors and on fixed income. There is a break for those 65 and older, and there is a break in terms of a tax credit for those on a fixed income of $50,000 or less," said Kirk Caldwell, Honolulu Mayor.
Keep in mind, the tax rate of $3.50 for every $1,000 of assessed value has stayed exactly the same. Homeowners are paying more because values have gone up by an average of 10 percent on Oahu. It's all market driven.
"It's not an exact science but it is all supported by market data," said Gary Kurokawa, Honolulu Budget and Fiscal Services Deputy Director.
The City collects nearly $900 million a year in property taxes. That is less than half of the total $1.9 billion operating budget.
As always perspective counts. Today's bill is likely around the same as people were paying back in 2008 before the housing bubble burst.
"Where are you compared to where you were in 2007 before the meltdown? You may not be at the same level or you may be a little higher," said Mayor Caldwell. "An increase in value is a positive thing. It does mean they have to pay a little more in property taxes but there is also the benefit that they have a home that is increasing in value."
The mayor also plans to approve a plan making a second tax tier for people but it only affects those that have a second house worth more than a million dollars that they don't live in or get exemptions on.
Just remember there's probably no pot of gold at the end of the rainbow but there is value in your home.