Unsellable Property Assessments

[ironyak]

Given the drop in Puna property sales and the discussion elsewhere that many properties are 'unsellable' due to the insurance moritorium, how would county assessor's office determine property value and taxes as this flow continues? Thoughts on if an unsellable status would be grounds for an assessment appeal?

http://www.hawaiipropertytax.com/appeals.html
Appeals - General Information
For the majority of assessments, the assessed value is also the market value of the parcel.

[HereOnThePrimalEdge]

When I moved to Big Island and received my first real estate tax bill, the assessment was 35% higher than the purchase price. I called the tax office and asked what they based the assessment on. I was told, the value of the property. I asked, isn't the value what someone is willing to pay for it?

"Not necessarily" was the reply. There are other factors taken into consideration.

[ironyak]

Such as...

[HereOnThePrimalEdge]

They wouldn't say. Must be like the recipe for Coca Cola, or McDonalds special sauce.

[pbmaise]

Of course no official will be bothered like no insurance company will pay out without a formal appeal or claim.

No property is unsellable if there is the capability to deliver title.

The correct term in this case is unmarketable. Further that marketability is defined as a reasonable buyer motivated to buy with the typical condition of availability of mortgage and insurance if the subject property is a home.

The appeal process is on the County of Hawaii website the last time I checked. Your claim process against title insurance is in your closing docs.

With title on the hook to pay 150% of purchase price for most homeowners you seem a bit depressed.

Of course both County and Title will see some residual value.

[ironyak]

Thanks for the clarity about the term unmarketable. Has anyone heard this term used by their mortgage company? Was this designation applied when access to Royal Gardens was cut-off?

As for title insurance being on the hook - that's for a jury to decide (see pbmaise v self
http://punaweb.org/Forum/topic.asp?TOPIC_ID=19942

[nanasohana]

So "unmarketable" is the title companies liability and the bullseye for a claim on title insurance? Unless, of course, there is a specific exemption?

[Kapohocat]

quote:

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Originally posted by ironyak...
As for title insurance being on the hook - that's for a jury to decide (see pbmaise v self
http://punaweb.org/Forum/topic.asp?TOPIC_ID=19942

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Title insurance is off the hook if you switched from your name to your name as a Revocable living trust. (I got the denial letter to prove it).

On the assessment issue, it will be interesting to see what the 2015-16 assessments look like. When do they come out - Feb maybe?

[kalakoa]

There are other factors taken into consideration.

I've long wondered about these mystical "other factors". For example, TMK 160010160000: 4305 acres, assessed value 575K ($134/acre), tax $2656 ($0.62/acre).

[HereOnThePrimalEdge]

kalakoa -
The fact that properties are over assessed as well as under assessed proves the system works.
That is if you are in government or know someone who is.

I've seen those same type of valuations. Big property owned by a prominent local family assessed for pennies. A few lots down a much smaller property with a much larger tax bill. Address of the owner, New York City.