Rating values (RV) on homes in Central Hawke's Bay have shot up by 55 per cent, on the back of a thriving property market in the district.
Every council in New Zealand must complete a revaluation of the properties within its district at least once every three years. Quotable Value (QV) has prepared this year's revaluation and determined the average house capital value is now $345,000 and house land value is $102,700.
Mayor Alex Walker said the substantial growth in property values was not unexpected and reflected the "surge of positivity and optimism" in the district.
"The secret about Central Hawke's Bay is out. The large amounts of growth and new residents we are experiencing across residential, commercial, industrial and rural properties, recognises that Central Hawke's Bay is a place where families and business can thrive - which has in turn increased the value of property.
"The increased land values also provides opportunities for Central Hawke's Bay residents to realise the potential of their new property values – which is positive all-round for Central Hawke's Bay."
The rating revaluation figures compiled by QV show the total rateable capital value of the 7741 properties within the Central Hawke's Bay District is now $5,716,116,000. The land value of those properties is $3,621,894,000.
QV Property Consultant Philippa Pearse pointed out demand for residential property, particularly in areas within commuting distance to Hastings and Napier, had resulted in significant increases in values.
Average prices for residential property have increased by 55 per cent for residential property over the past three years.
Generally, housing at the lower end of the market has experienced a higher percentage of value growth compared with higher-value properties.
"The buoyant sheep and beef market has also driven strong demand for pastoral farms resulting in value growth. Some rural properties have had a significant increase in the land value due to a change in the prescribed methodology used to value irrigated land set by the Valuer General.
"The lifestyle market has also experienced considerable growth particularly properties in close proximity to townships."
Some commercial and industrial properties have also increased in value. The average capital value for developed commercial property has increased by 10.2% since the last rating revaluation in 2015, and the average capital value for developed industrial property is up by 18.8% over the past three years.
CHB District Council would use the new values as the base for setting rates from July next year.
Council chief executive Monique Davidson said staff were reviewing the new values to assess the impact on rates for individual properties.
"It is important to recognise that while land values may have increased, the overall rates collected by the council does not increase or decrease. Instead, the new QV values changes how the cost of rates is spread among ratepayers in slightly different proportions than before".
The council had yet to make any decisions about the rating system and levels of rates for 2019/20.
New rating values would be posted to property owners after November 28, 2018. If owners do not agree with the rating value, they have the right to object to their valuation by mail, using the instructions on an owners' valuation notice, or online before January 25, 2019.
The district's residential property stock totalled 4306 properties - 84 more than in 2015.
Davidson said growth was being catered for through the council's Long-Term Plan.
"This, together with our infrastructure strategy, has driven the extensive capital work programme that the council has committed to over the next 10 years - not only to build resilience within our existing network while also allowing provision for growth."