Why the new values may not affect your rates.
Updated property values for all properties in the Auckland region will hit mailboxes, inboxes and online later this month.
The Covid-19 pandemic has added layers of complexity which affected the council's ability to complete revaluation this year, something all councils are required to do by law every three years.
The new valuations for the Auckland region were delayed but are now expected to be available shortly.
The revaluation was due to be undertaken in 2020 but the pandemic made it difficult to accurately forecast sales data; the Valuer General granted the council a deferral of 12 months.
Revaluation was then planned for October 2021 but, in August, Alert Level 4 restrictions affected the council's ability to complete the final stages of the valuation process and the Valuer General's ability to conduct an audit of these values.
The new values we assign are based on the most likely selling price if the property had sold on June 1, 2021. A rigorous process was undertaken to reach the new values – exciting, as revaluation allows us to set rates fairly for the 2022/2023 rating year and crack on with the initiatives in the 10-year budget.
Why we revalue properties
Auckland has seen significant population growth over the last few years and the pressures this has put on the housing market are well-known to all.
The value of properties is one of the ways we calculate each ratepayer's share of rates, so it is important we are using current figures to ensure a fair rating system. The property market is dynamic which is why these values change over time.
The valuations capture only a moment in time and should not be viewed as a current market value – but we know that there is still a huge amount of interest from Aucklanders in their new values.
How we calculate values
We compare recent sales in the area with the property being valued. We consider many factors, including the property type, location, land size, zoning, floor area and any consented work for renovations, new builds or subdivisions.
The property value is made up of three parts: capital value, land value and the value of improvements.
- Capital value (CV): the most likely selling price if the property had sold on June 1, 2021
- Land value (LV): the most likely selling price of the bare land on June 1, 2021
- Improvement value (IV): The CV minus LV. The IV does not represent the replacement value of the building(s) or other improvements on the land.
The revaluation is a 'point in time' exercise and is not meant to reflect the ongoing probable sales price of a property.
Keep in mind, the value of improvements is an indicative value and won't necessarily represent the value of any buildings currently on the land.
Revaluation and rates
We use property values to share the rates the city needs to raise between properties.
Revaluing Auckland's properties won't affect the amount of money the council collects from rates. It helps us make sure we are sharing the rates requirement fairly between properties as valuations move across the city.
Your property value is only one of the elements which help us determine your share. If your property value has increased, this does not automatically mean you pay more in rates. What will determine a rates increase is if your property value has increased more than the average increase across the region.
If your property increases in value but this increase is below the average, this may mean you will pay less in rates.
Revaluation won't affect rates until 2022
The impact of revaluation won't come into play until July 1, 2022. Your current rates will stay the same until then.
Visit aucklandcouncil.govt.nz/revaluation to find out more.