KEY POINTS:
There is a silver lining to falling property prices in Auckland City - most households have been spared higher rates from the latest property revaluations.
Soaring house prices led to rates increases of 50 per cent or more in boom areas like Waiheke Island at the last property
revaluations in 2005.
Now, with house prices falling and more stable commercial values, businesses are bearing the brunt of the 2008 property revaluation exercise.
Even then, other levers mean household and business rates will generally rise next year at about the council's rate of inflation of 5 per cent.
The big exception are 742 rural properties, mostly on the gulf islands, where big rises in property values translate into an average rates increase of 12.6 per cent.
The council is sending out the latest revaluations to 173,000 property owners across the city this week. The figures reflect the change from July 1, 2005, to July 1, 2008. House prices continued to rise for most of this period before tapering off and starting to fall this year.
The values were produced through a mass appraisal approach, where valuers inspected about 85,000 houses from the road and used sales figures in the three months up to July 1 this year.
The revaluation is done every three years for rating purposes and does not necessarily reflect current market value. The new values will be used to set rates from July 1, 2009.
The exercise does not generate any additional revenue for the council. It is used to redistribute the rates total, according to how property values increase or decrease relative to the citywide average.
This year, the citywide average is an increase of 12.5 per cent. This means that property owners whose values rise by more than 12.5 per cent face a rates increase, and vice versa.
Great Barrier Island residents face the biggest rise in rates as a result of a 39 per cent jump in property prices since 2005. Other areas to have experienced jumps of more than 20 per cent are Western Springs, Otahuhu, Pt England and Rakino Island.
On the flip side, the revaluations in Grey Lynn, New Windsor, Owairaka and Three Kings have gone up 6 or 7 per cent, so residents can expect a small drop in their rates.
Great Barrier Community Board chairman Paul Downie blamed a distortion of high property prices at Medlands Beach for the big jump in valuations. That, and low sales volumes, would be felt by most of the island's 1400 property owners who lived more modestly, he said.
In 2005, property values rose by an average of 42 per cent across the city and runaway house prices contributed to 5 per cent on average of the 13.2 per cent rates increase in 2006. The pain was greater in places like Waiheke, which experienced a 98 per cent rise in house values and rates increase of 50 per cent or more.
Finance committee chairman Doug Armstrong yesterday said there were fewer wild swings in the latest revaluations and a reflection that non-residential properties had been more stable holding their value.
Anyone not satisfied with a new valuation can lodge a formal objection with the council before December 1. In 2005, there were about 5300 objections.
