Hawaiian Homeland Homes

Community Contributed

By Eileen M.S. Nims, Esq.

Question: I live on Hawaiian Homestead lands, so I don’t own any property, right?

Answer: Actually, that is not correct! It is true that you don’t own the land you are leasing from Hawaiian Homelands, but if you built a house, then the value of the house is yours!

When it comes to dividing up your interest in property to your children after your passing, it is important to realize that the homes that have been built on homestead lands have a value to your children. So, if your children meet the qualifications to live on the property after you are gone, they actually inherit also the value of your house. This is important to know, since if you don’t have a will or trust, each of your children receive an equal share of your assets. Say, for example, the house you built on your Molokai homestead is worth $300,000 and you have three children. Now each one is entitled to receive 1/3 of the value of the house, which is $100,000. If only one child has the qualifications to live on the property, that child will have to pay the other two $100,000 each, because each child is entitled to receive 1/3 of the value. 

This is, of course, a fair distribution of your assets, but you may have different wishes. You may want to leave the child who is qualified to live on the property with the house without him or her having to pay the other children a share of the value. This is easily done by creating a will that specifically states who gets what and under what circumstance. It is also possible that none of your descendants want to or are able to live on the homestead. In that case, the house will be sold to the next person who is on the DHHL waitlist and wants to purchase the house from your heirs. The proceeds from that sale will then be distributed to your children, or other heirs, according to either your will, or according to the Hawaii State Statutes. 

So even if you own a home that is on Hawaiian Homelands, you will want to create a will that specifies what you want to happen with that home and with the value of that home after you have passed on. 

If you want guidance with will-related matters and receive individualized legal advice with regards to your estate planning, please feel free to contact Eileen M.S. Nims, J.D. at eileen@nimsesq.com or by phone at (808) 664-1834.