Concern over rates as Napier property values soar

Overall rating values have soared for Napier properties. PHOTO/DUNCAN BROWN.

Concern has arisen over the rates bill Napier residents could receive next year, but the city's Mayor is promising the council will "keep Napier affordable".

Every three years councils do property valuations, with Napier City Council the latest in Hawke's Bay to release its new rating values which will be used to apply the basis for setting rates from July next year. Property values are one component of how rates are formulated.

Napier's new valuations show substantial increases for properties across the city from the 2014 valuation - with an average increase of around 40 per cent in land value.

These increases have caused concern among some ratepayers, with chatter on social media about "freaking out" over what it could mean for rates.

The impact is unknown at this stage as Napier City Council is waiting for modelling on the recent valuations, Mayor Bill Dalton said.

"But sure there's been some significant land valuations come through, and that will certainly have an impact on rates no question about it.

"It certainly wont be an unjust increase I can give an absolute assurance of that."

Rates rise as council costs increase, however Mr Dalton said the council took "this situation very seriously", as it wanted to remain one of the cities with the lowest comparable rates.

"We are determined to keep Napier affordable and we don't want anybody to suffer to the extent where they can't afford to live in Napier. We will be conscious of it when we're setting the figures in the near future." .

To complete the valuations on behalf of council, Quotable Value (QV) assess properties in relation to current market values. It uses a mass-appraisal process based on property sales, supported by individual assessments.

QV Property consultant Pip Pearse said even though there had been strong value growth, this shouldn't have much impact on rates.

"The only time you're going to see a change in your rates is if your land value has gone up significantly more than others in your area, or dropped significantly compared to others."

If a property's land value was in line with the average land value movement, this could mean rates stayed static, "apart from just the normal increase that the council do."

If a property's land value had increased by 40 per cent, this would be in line with the Napier average.

Yesterday a council spokeswoman said work to determine the average residential movement, change by suburb, and commercial property movements is currently being done by the council.

Modelling of the possible rating effects will go to the council next week, a council spokeswoman said. The 2014 QV report saw an average 3 per cent rise.

This modelling would be indicative, as other factors would also impacts rates -especially as the council goes through its Long Term Plan 2018-2028 process.

She added the overall rates revenue to council did not change based on the QV values.

Council Economic Development Manager James Rowe said the updated RVs were a reflection of the strong economic growth within Napier, and Hawke's Bay.

"The new higher valuations are a direct reflection of the surging local property market and the fact that our city is a highly desirable destination for visitors, new businesses and those seeking "the good life"".

Hastings District Council did its revaluations last year, with the new rates effective from July this year - with no capital change. Central Hawke's Bay District Council's valuations will be completed at the end of 2018, to affect rates from July 2019.

Napier rates increased by 4.5 per cent this year, with 1 per cent going toward safe drinking water requirements and drinking water infrastructure.

Residents are able to lodge an objection to the new values with QV