What It Actually Costs to Sell a House on the Big Island

Ask most people what it costs to sell a house and they'll say "the commission." That's the big one, but it's not the whole story, and on Hawaiʻi Island a couple of the line items catch people off guard — especially owners who bought years ago from the mainland and have never sold property in the state before.

I've sat across enough kitchen tables in Hilo and Kona to know the moment it lands: we're going through the seller's net sheet, everything's tracking fine, and then we get to a withholding line with a number in the tens of thousands and the room goes quiet. None of it is a secret. It's just rarely explained until you're already under contract. So here's the whole picture, in the order the money actually leaves the table.

The commission — and what changed in 2024

For decades the convention in Hawaiʻi, like most of the country, was a total real estate commission of roughly 5 to 6 percent of the sale price, split between the listing brokerage and the brokerage that brought the buyer. The seller paid all of it out of proceeds.

That convention cracked open in August 2024, when the National Association of Realtors settlement took effect. Two things changed that matter to you. First, buyer-agent compensation is no longer advertised in the MLS. Second — and this is the part that's still settling into local practice — it's no longer assumed that the seller pays the buyer's agent at all. Commissions were always legally negotiable; now they're negotiated out loud.

In practice on the Big Island, most sellers still list with a brokerage for somewhere around 2.5 to 3 percent on the listing side, and many still choose to offer something to a buyer's agent because the large majority of buyers here are represented and you want those buyers through the door. But the "6 percent, no questions asked" era is over, and you should treat every percentage point as a real decision, not a default.

This is the line item we built our whole brokerage around. Rock Realty lists for a flat 1 percent (with a $5,000 minimum and a $12,500 cap), and a licensed broker still does the pricing, the negotiating, and the closing. Whether you offer a buyer's-agent cooperation fee is a separate choice you make at offer time. On an $800,000 sale, the difference between a 3 percent listing side and our 1 percent is $16,000 — money that stays in your pocket for doing one thing differently, which I'll get to. If you want to see the math on your own number, the pricing page has a calculator.

Hawaiʻi's conveyance tax

The state charges a conveyance tax every time real property changes hands, and by long-standing custom the seller pays it. It's graduated by price, and there's a wrinkle that's pure Hawaiʻi: the rate depends on whether the buyer is going to live in the home.

It starts at 10 cents per $100 of value — that's one-tenth of one percent — for homes under $600,000 where the buyer qualifies for the county homeowner's exemption (in other words, they're going to occupy it). From there it climbs in brackets all the way up to $1.00 per $100 for sales of $10 million and above. If the buyer is not going to occupy the property — a second-home buyer, an investor — the rate in each bracket is higher. The current brackets are published by the Hawaiʻi Department of Taxation, and your escrow officer will calculate the exact figure, but the rough shape is easy to carry in your head: on a typical owner-occupied sale it's a fraction of a percent, and it gets less trivial as the price climbs and if the buyer isn't moving in.

On a $700,000 sale to an owner-occupant, you're looking at roughly $1,400 in conveyance tax. Not the line that breaks the deal — but real money, and it's yours to pay.

Escrow, title, and the closing-cost split

Hawaiʻi runs sales through neutral escrow companies rather than closing attorneys, and there are customary splits for who pays what. "Customary" is the operative word — all of it is negotiable, and on the Big Island the practice is fairly consistent:

• Escrow fee: usually split 50/50 between buyer and seller.
• Owner's title insurance policy: customarily the seller's cost. This protects the buyer's ownership against title defects, and on a $700,000 home it typically runs somewhere in the four figures.
• Recording fees, conveyance document prep, courier and notary charges: small, and split per custom.
• Your mortgage payoff: whatever you still owe, plus any per-day interest through the closing date and a possible payoff/reconveyance fee from your lender.
• Property tax proration: Hawaiʻi County bills property tax in two installments. At closing you'll credit or be credited for taxes depending on where you land in the cycle. It nets small but it's on the sheet.

Add it up and the "everything except commission" pile on a mid-priced Big Island home tends to land somewhere in the low single-digit thousands. Predictable, and your broker should hand you a net sheet that spells every line out before you sign anything.

The one that surprises mainland owners: HARPTA

Here's the line that quiets the room. If you are not a Hawaiʻi resident when you sell, the state requires escrow to withhold 7.25 percent of the gross sale price at closing under the Hawaiʻi Real Property Tax Act — HARPTA. On a $700,000 sale, that's $50,750 held back from your proceeds.

Read that carefully, because the panic is usually a misunderstanding: HARPTA is a withholding, not a tax. It's the state making sure non-residents actually file a Hawaiʻi return on the gain. If your real tax owed is less than what was withheld — which is common — you file and you get the difference back. There are also ways to apply for a reduced withholding when the actual gain is small. But the cash is gone at closing and comes back later, and if you were counting on every dollar of proceeds to buy your next place, that timing matters enormously. Plan for it.

Foreign sellers have a parallel federal version called FIRPTA, withheld at 15 percent, which stacks on top. Between the two, an overseas owner can see more than 22 percent of the sale price held back. If that's you, talk to a Hawaiʻi-savvy CPA before you list, not after.

General excise tax, quietly

Hawaiʻi doesn't have a sales tax; it has the general excise tax, and on Hawaiʻi Island it runs 4.5 percent (the 4 percent state rate plus the county's half-percent surcharge). You won't see GET as its own line on your net sheet, but it's there — real estate brokerage commissions are subject to it, so it's baked into what brokerages charge. Worth knowing it exists; not worth losing sleep over.

So what do you actually keep?

Let's run a clean example: a $700,000 home in Puna or Hilo, owned free and clear, sold to a local owner-occupant by a Hawaiʻi-resident seller.

That $14,000 swing is the listing commission, full stop. Everything else is the same no matter who you list with — the taxes and escrow costs don't care about your brokerage. Which is exactly why it's worth being a hard negotiator on the one line you control.

The honest catch

I'm not going to pretend 1 percent is free money. The reason a full-service brokerage can list your home for 1 percent instead of three is that nobody from our office stands at your door for showings. A buyer's agent opens a lockbox, or you host the showing yourself, and you control the windows. That's the trade. For a lot of Big Island sellers — especially ones selling a vacant home, or comfortable with a lockbox — it's an easy trade to make for five figures. For someone who wants an agent physically present at every showing, it honestly isn't the right fit, and I'll tell you that to your face.

If you're weighing a sale, the most useful next step is a real net sheet on your property and your situation — resident or not, mortgage or not, owner-occupant buyer or investor. That's a five-minute conversation. You can talk it through with Nalu, our AI assistant, any time, or read how the 1% service works and what we do and don't do first.

This article is general information for Hawaiʻi Island sellers, not legal, tax, or accounting advice. Conveyance tax brackets, GET rates, and withholding rules change — confirm current figures with your escrow officer and a Hawaiʻi CPA.