Hawaii County Real Property Tax Administrator Stan Sitko said Tuesday the reason lies in the 3 percent cap put on property values in the homeowner classification in 2004.

The cap was established so properties “would not be subject to more than a 3 percent rise in assessed value on existing real property from year to year in a rapidly rising market,” Sitko said.

“Exceptions to the cap are made for new additions, which are added at full value and then capped for the following years,” he said. “The 3 percent rise continues until market value is reached.”

Before the economic recession, when market values were increasing 20 percent to 30 percent annually, “the difference between the capped assessed value and the market value was so large that it would have taken 10 years for the capped assessments to catch up to a one-year rise in the market,” Sitko said.

He said the disparity between capped assessments and market values “can grow very large after a few years of rapid growth.”

“The market does not, however, just go up nor does it change at a fixed rate,” Sitko said.

“This year we are seeing market values go down while the capped assessments are still going up at a 3 percent rate, as they are still below the current market values.”

Sitko said he expects his office to be flooded this year with appeals from property owners unhappy with their assessments.

“I expect a lot of people (to appeal) because we’re in a recession, and everything else is not looking cheerful,” he said.

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There were 85 single-family homes sold on the Big Island in February, a 17 percent drop from the same month last year, according to statistics from Hawaii Information Service. Sales were down by 29.5 percent for January and February combined.

The median price of a single-family home dropped 26 percent in February to $291,000, down from $395,000 in February 2008. The median price for the first two months of the year combined was $276,000, a 25 percent drop from those months in 2008, when it was $370,000.

The median price of a Big Island condominium last month was $435,000, jut 4 percent off the median condo price in February 2008, which was $453,500. But that was based on just 13 units sold, which was 54 percent fewer units sold than in February 2008. Sales for the first two months of the year were down 42 percent from the same period last year.

Condo prices for the first two months of the year didn’t fare as well as in February. The median price of a Big Island condo for January and February combined was $245,500, a 46 percent drop from the same months in 2008, when it was $453,500.

Source: Pacific Business News

Hawaii’s rate of foreclosure filings for January was 174 percent higher than a year ago and topped 300 for the sixth consecutive month.

RealtyTrac, an Irvine, Calif.-based foreclosure listing service, reported 337 filings for January, up from 123 a year ago. Despite the big increase, the figure was the lowest since August and was much lower than December’s 499 filings or September’s 594.

The increases from last year reflect a troubled housing market as more borrowers are unable to meet loan payments and housing values decline.

Figures by county show that Maui had the highest rate of filings per household with about one out of every 800, while Honolulu’s rate was the lowest at one for every 2,200. The Big Island and Kauai had roughly one out of 1,000 households in January.

Overall, the state had about one filing per 1,500 households, which was far better than the national average of one for every 466 households.

Across the country, the firm reported nearly 275,000 foreclosure filings last month, up 18 percent from a year ago.

The county breakdown for Hawaii was 152 filings on Oahu, with 79 on the Big Island, 78 on Maui County, and 28 on Kauai.

Prior to August, filings in Hawaii averaged about 150 a month. Most of the filings were foreclosure sales notices.