The Honolulu City Council is considering a bill which would increase the property tax rate for all transient vacation units(TVU) and bed-and-breakfast (B&B) homes on Oahu. Currently, both endeavors are taxed at a residential property tax rate which is $3.50 per $1,000 of assessed value. In comparison, hotel/resort owners pay $12.40 for every $1,000 of assessed value. Under Bill 23, argues that transient vacation units and bed-and-breakfast homes are business activities, and would be fall somewhere in between residential properties and hotel/resort properties.
Bill 23 will also include legislation to help crack down illegal vacation rental homes as well as a new process for people interested in legally turning their property into a transient vacation rental or bed-and-breakfast to be able to do so. According to the city Department of Planning and Permitting, there are currently only 48 legal B&Bs and 810 TVUs in Honolulu. However, it is estimated that there are probably triple that amount of illegal operators. For information on Honolulu's current rules go to: http://www.honoluludpp.org/ReportsNotices/tabid/85/aid/5/Default.aspx
Source: Honolulu Star Advertiser, 3-12-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
Global Executive Realty, LLC
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