Hefty rate rises likely for some Hastings district residents after increased land valuations

Hefty rate rises could be on the cards for Hastings residents.

A 1.9 per cent overall rate increase for Hastings district has been proposed for the coming year, but this could change dramatically for Hastings, Havelock North and some rural residents in light of increased land valuations.

Residential Hastings and Havelock North land values rose by 25 per cent in August last year, from the last valuation conducted by Quotable Value (QV) three years before that.

A report presented to the Hastings District Council yesterday showed this equated to an average 3.5 per cent increase in rates for these residential properties, bringing their total potential rates rise to about 5.4 per cent, when added to the overall rate increase.

Hastings mayor Lawrence Yule said this was the most dramatic hike in residential rates he had seen in his time in the role.

"In the past coastal properties have gone up a lot, but this is the first time residential values have gone up substantially more than average - it's sobering."

Lifestyle, horticulture and farming properties, especially those of higher economic value, were also not immune, with a potential rates increase in the region of 3 to 6 per cent.

Flaxmere values, however, decreased by 10 per cent, and Hastings commercial property values stayed the same, signalling a 10 per cent rates reduction in both these areas.

At a council meeting yesterday, councillors discussed whether the rate increases could be "smoothed out", become more user-pays or be phased in over time.

All of these options, however, had legal implications, and it was noted that the valuations conducted by QV were independent and people could object to them.

One tool to soften the blow was to suspend the differential rating programme that began in 2012.

This was introduced at a time when commercial rates were deemed to be too high, and it was decided that over the next eight years commercial rates would be reduced and residential rates increased.

Now that residential valuations had gone up and commercial had remained static or declined slightly, it was felt appropriate to pause this for the coming year.

The council also decided to review the spending programme for the 2017/18 year to see if any cuts in spending could be made to reduce the overall 1.9 per cent rate increase.

The rating changes will go out for consultation with the annual plan this year.