3rd October 2011

Ratepayers should be ready to object to new rating valuations

The Auckland Council has announced its intention to issue new rating valuations to Auckland property owners on 27th October.

Any council revaluation generally results in some ratepayers paying more, and some less, than the previous year’s rates levy. For residential ratepayers these changes do not recognise any changes in the incomes or personal financial circumstances of individual households.

Valuations are the core reason why the rating system is totally unfair as it takes no account of ‘ability to pay’.

Homes are calculated by a ‘mass appraisal technique’ – in other words a desk-top process of assessing the likely sales value of broadly similar type homes, based on information on property sales in local neighbourhoods.

The system leads to many unfair valuations and consequent unfair rates increases.

These new Auckland valuations will set the levels for charging rates for the next three years.

Ratepayers should be prepared to challenge their new valuation if they believe they are being overvalued.

Many ratepayers are afraid to challenge their valuation which they believe will impact on what price they might get if and when they sell.

This fear is generally fuelled by real estate salespeople who usually quote, a “CV” or “GV” figure to give price indications.

This practise should be outlawed in favour of more accurate indications based on actual recent sales.

This Auckland revaluation will also be heavily influenced by the change from Land value to Capital value for many properties in the old city council areas..

I urge all ratepayers to take the opportunity to challenge their new valuations by asking the Council to produce the local information on which their valuation has been set.

ENDS

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