The effect of revaluation of properties

Press, 9 April 1980, Page 13

The effect of revaluation of properties

LOOKING AT REAL ■ESTATE .

By

the Real Estate

In many areas where there is a substantial rise in property rates there has often been a recent revaluation by the Government and the ratepayers are prone to seize on this as the reason for the increase. This generally is wrong, even in the face of revaluations of 200 to 300 per cent on the previous fiveyearly assessment. Each of the million or so properties in New Zea- • land is valued every five years and although these figures are usually the basis for the rating system they cannot affect

local body expenditure, which is itself the basis for rates. Before striking their rates local bodies arrive at a total expenditure figure and from it subtract expected Government subsidies and income from other sources. The net amount has therefore to be collected from the ratepayers. There are several methods of calculating the • levy on ratepayers. The main one to set a figure in the dollar for each dollar in the valuation. For instance a rate of 8c in the dollar on a property

valued at $25,000 would mean a bill for $2OO, to which will also be added water rates, loan repayment charges and one or two other minor sundries. Council collections on behalf of ad hoc bodies, such as drainage boards, may greatly increase the final bill. ’

As the local body’s needs increase so, too, do the rates.

The method of carrying out government valuations is to assess the value of the land and to add to it the value of the improvements, such as buildings. Improvements may

mean only gardens and fences where there are no buildings on the land. An owner of property always has the right o'f objection against his Giverriment valuation within a specificed period of time.