Hawaii Depreciation Calculator

Real estate depreciation lets you deduct the cost of a building over its useful life — 27.5 years for residential property. Pre-filled with Hawaii median property value of $743,000.

Market

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Property Details

Property Type

Purchase Price

Land Percentage($148,600 land)

Capital Improvements

Tax & Timeline

Marginal Tax Rate

Years Held

Depreciation Schedule

$21,615$21,615 total

$21,615$43,229 total

$21,615$64,844 total

$21,615$86,458 total

$21,615$108,073 total

$21,615$129,687 total

$21,615$151,302 total

$21,615$172,916 total

$21,615$194,531 total

$21,615$216,145 total

$21,615$237,760 total

$21,615$259,375 total

$21,615$280,989 total

$21,615$302,604 total

$21,615$324,218 total

$21,615$345,833 total

$21,615$367,447 total

$21,615$389,062 total

$21,615$410,676 total

$21,615$432,291 total

$21,615$453,905 total

$21,615$475,520 total

$21,615$497,135 total

$21,615$518,749 total

$21,615$540,364 total

$21,615$561,978 total

$21,615$583,593 total

$10,807$594,400 total

Hawaii Market Context

Avg Cap Rate

Median Price

$743K

Property Tax

0.31%

Vacancy Rate

7.4%

Local Factors

-Lowest property tax rate in the nation at 0.31%
-Extremely limited land supply drives high prices and low cap rates
-Short-term vacation rental regulations vary by island and can significantly impact returns

Sources

World Population Review – Median Home Price FL Probate Law – Property Tax Rates (ACS Data)The Hartford – Insurance Rates iPropertyManagement – Vacancy Rates RentData.org – Fair Market Rent

Annual Depreciation

$21,615

$1,801/mo

Solid Savings

Annual Tax Savings$5,187

Depreciable Basis$594,400

Building Value$594,400

Land Value$148,600

Useful Life27.5 years

Total Deductions Taken$21,615

Total Tax Savings$5,187

Years Remaining27 of 27.5

Land (Non-depreciable)$148,600

Depreciation Taken$21,615

Remaining Basis$572,785

What does this mean?

You're getting meaningful tax savings from depreciation. This phantom expense reduces your taxable rental income without costing you anything out of pocket.

How Real Estate Depreciation Works

Depreciation is one of the most powerful tax benefits of owning rental property. The IRS allows you to deduct the cost of a building (not land) over its useful life — 27.5 years for residential and 39 years for commercial property.

This is called straight-line depreciation because you take equal deductions each year. It's a "paper loss" — your property might be appreciating while you claim it's losing value. That phantom expense offsets rental income and reduces your tax bill.

Keep running the numbers

One calculator rarely tells the whole story.

Depreciation is the silent return in Hawaii. See how it compounds.

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