Coastal properties are leading the fall in Whangarei property quotable values, with one Whangarei Heads resident seeing the official value of his home plummet by $120,000, or a 20 per cent drop.
QVNZ has released the latest quotable valuations (QV) for Whangarei which show that valuations across all sectors and almost all suburbs have fallen since they were last officially done in 2009. While most have seen the official value of their property fall, Hikurangi is the only suburb that recorded a rise.
The valuations have fallen most in coastal areas, with one coastal homeowner witnessing a valuation drop by $120,000 to $460,000. However, the man, who did not want to be named, said he had no intention of selling and so, was not too worried about the latest valuation.
"A higher valuation is only really a big advantage if you are wanting to sell. I hope that the fall will mean I don't have as much rates to pay next year."
Coastal home owner hit with $120k QV drop||Sellers are terrified that they have suddenly lost a lot of money. Graeme Lester, Northland REINZ Rates are based on land values in Whangarei, going up by the rate of inflation every year, and people pay a proportion of the total amount collected, based on their QV.
Only homeowners who saw their land value decrease by far more than the average will likely see a fall in rates.
However, Northland REINZ spokesman Graeme Lester said the QV had little relation to a property's selling price as that was driven by the market value.
"Most people seem to forget that the QV is a value established by the Government so that it can have a written value of all properties in the country," Mr Lester said.
"For example if there are four homes in a street worth $100,000 and one worth $500,000 and the $500,000 one is the only one that sells in that street in the three years and only goes for $400,000 the QV is then adjusted for all the homes in that street down by 20 per cent to reflect recent sales in the street.
The new values were already causing a few problems with some buyers using them to try to drive down a property's price since they came out last month.
"Buyers are trying to use them to their advantage and sellers are terrified that they have suddenly lost a lot of money. But the asking prices last week are the same this week and selling prices won't change much, if at all, because of the new QVs,"
Mr Lester said.|QVNZ Northland team leader Bruce Wiggins said overall capital values in the district have dropped on average by 7 per cent, land values by 12 per cent and industrial land values have suffered the biggest fall, down 27 per cent.
"Values for coastal blocks have also fallen, whilst quality properties in other areas are holding their value," he said.
"This is evident in Bream Bay and some other coastal areas, where values have fallen more than most, mainly due to the large amount of available land in the area. In contrast, Waipu and Langs Beach have seen little to no movement.
"The market for vacant sections has struggled over the three years, due to low demand, coupled with over-supply."