Published 14 January 2006
42% is the benchmark to calculate a likely rise or fall in your Auckland City rates bill for the next financial year starting in July.
That’s the average by which the annual value of the city’s 163,000 properties has risen since the last Auckland revaluation in July 2002. To see the changes in land, capital & annual values around the city, click the box:
Maps produced by the council showed pepper-potting of rises & falls, rises generally in areas of large subdivision, and on the Hauraki Gulf islands large rises were almost universal.
Annual value is the measure Auckland City Council uses to work out the rates it charges on individual properties (along with other calculations such as the commercial differential). It’s calculated as the higher of the estimated gross rental less 20% (or 10% if it’s a vacant site), or 5% of the property’s capital value. The rental assessment is done whether or not the property is actually rented.
The council also assesses land value & capital value. In the latest revaluation, land value rose 86%, capital value 51%. At the 2002 revaluation the rises were much more conservative â€“ 11% for annual value, 14% for land value, 13% for capital value.
The council will send its revaluation notices out on Monday 16 January. Objections close on Wednesday 15 March. The council will hold its annual plan meeting on Wednesday-Friday 8-10 March then set the total rates requirement & individual components in June.
42% is the benchmark for rates contributions. A revaluation assessment above that means the property’s share of overall rates will be higher than before, but other factors include targeted rates, as well as changes in the total rates bill and in the number of rateable properties.
John Wells, who headed the council project, said factors affecting valuation changes included:
strong industrial & retail markets (low vacancies in those markets, but office vacancies ranging from 5-15%, depending on location)
the big demand for mixed-use properties
single-digit cap rates across much of the city, except for large office buildings (where the cap rate range was 10-11.5%)
big rises in land values rather than the value of improvements
consequently, a bigger valuation movement for larger properties
strong presence of owner-occupiers keen to insulate against future rent rises, “often in desperation & at a premium)
greater recognition across the city of parking as assessable property (where previously parking may not have been recognised as a contributor to value or assessed separately â€“ there are more unit titles for parking spaces, with rent being paid for parking spots in places like Mt Eden & One Tree Hill)
a significant increase in contribution from the rural sector, especially affecting island rural property.
Attribution: Council statistics & press release, council media conference, story written by Bob Dey for this website.