Assessed value vs sale price: how accurate is Hawaii County?

Every property on Hawaii Island has an assessed value set by the county. Homeowners watch it for tax purposes. But how close is the assessed value to what homes actually sell for?

The overall picture

Across 25,000+ qualified sales in our database, the median ratio of sale price to assessed value is 1.35. That means homes sell for 35% more than the county says they're worth, on average. The county systematically under-assesses, which is intentional. Hawaii law targets assessment at 100% of market value, but reassessments lag the market by 1-2 years.

It varies by region

The gap isn't uniform. In fast-appreciating areas, assessments lag further behind:

• Puna: median ratio 1.42 (assessments 42% below sale price)
• Hilo: median ratio 1.28
• Kona: median ratio 1.31
• South Kohala: median ratio 1.45
• Ka'u: median ratio 1.25

Puna and South Kohala have appreciated fastest recently, so their assessments are furthest behind. Ka'u is closest because prices move slower there.

Can you use assessed value as a price estimate?

Roughly, yes. Multiplying assessed value by 1.35 gets you in the ballpark. But the standard deviation is large (about 0.3), so any individual property could be anywhere from 1.0x to 1.8x its assessment. That's too wide a range to price a real transaction.

What we do with it

Our valuation model uses assessed value as one of seven similarity dimensions for finding comparable sales. It's useful as a signal of relative size and quality within a neighborhood. But we'd never use it as the sole estimate. The actual value comes from what similar homes have sold for recently, with adjustments for differences. That's what a comp report gives you.