News and information – Real estate appraisals ready to be consulted
The new ratings can be viewed online at www.qv.co.nz – enter your address if you want to see the latest numbers.
Appraisals were prepared for 80,336 properties on behalf of City Council by Quotation Value (QV). They show that the city’s total assessed value is now $ 123,219,693,151, with the land value of these properties now appraised at $ 79,045,542,201.
Rating appraisals are typically done on all New Zealand properties every three years to help local councils set rates for the next three years. They reflect the probable sale price of an asset on the effective revaluation date, which was September 1, 2021, and do not include movable assets.
On average, the value of residential dwellings has increased 60.4% since 2018, with the average value of homes now standing at $ 1,435,000, while the average value of corresponding lots has more than doubled to an average of 985. $ 000.
QV Regional Director Paul McCorry commented: âIt will come as no surprise that demand for residential housing in the capital has been extremely strong over the past three years. In 2018, we were shouting about the number of million dollar suburbs in the city. In 2021, there isn’t a single place with an average value of less than $ 1 million – in fact, Kelburn, Oriental Bay, Roseneath and Seatoun have now passed $ 2 million.
âA large part of the increases in value are due to pressure on the land. Demand for vacant land has seen land values ââmore than double in many suburbs. We have started to see developers looking to demolish modest houses on sections with development potential. Rapid escalation is the model. This is not exclusively a problem of the city of Wellington, but one that is exacerbated by the physical constraints of urban sprawl.
Meanwhile, commercial property values ââhave increased 36.1% and property values ââin the industrial sector have increased 60.6% since the city’s last ratings appraisal in 2018. Commercial land values ââand industrials also increased by 52.2% and 73.1% respectively.
âThe commercial sector continues to have the greatest potential for the impact of COVID-19. Our discussions with landlords and tenants across the city show that the retail space has seen little growth in rents, especially from those reliant on hospitality or tourism. On the other hand, the office sector continues to show strength in the face of the pandemic. Appetite is really robust for Class A and earthquake resistant offices. Government employment in this space has really helped this resilience.
Meanwhile, Mr McCorry said the industrial market has compared favorably to the commercial market nationwide for some time now – a trend that has continued in the city of Wellington.
âThe number of real industrial properties is now relatively low, apart from the northern corridor, but good quality industrial spaces are in high demand and contribute to the growth of value. In the commercial and industrial sector, the demand for return / return on investment continues.
The average increase in the real estate value of commercial zoned land has been 52.2% since 2018, which McCorry attributes to a change in use from commercial to residential.
âWe have seen a huge demand for redevelopment land on the outskirts of the city. Areas such as Te Aro, Mount Cook, and Newtown, where you’re within walking distance of the CBD, are great for apartment living, and developers have purchased underutilized sites to satisfy that need. With the current supply chain issues, it remains to be seen how quickly some of these proposed developments will hit the market. “
Since 2018, the average capital value of an enhanced lifestyle property has increased 55.57% to $ 1,600,000, while the corresponding property value for a lifestyle property has increased by 91.18 % to reach $ 1,025,000.
âLifestyle properties make up a modest part of the Wellington city market, with just over 500 lifestyle properties primarily in the Makara, Ohariu Valley and Horokiwi areas. Typically, lifestyle values ââalign with high-end residential properties and this segment of the market has been dynamic, âadded Mr. McCorry.
He said there were few true rural properties in the city with less than 40 properties in total. Among these, the forestry sector had achieved the best results, up 69.2% in three years.
The effective rating reassessment date of September 1, 2021 has now passed and any changes in the market since then will not be taken into account in the new rating assessments. In many cases, this means that a sale price reached in the market today may be different from the new rating assessment set for September 1, 2021.
Updated rating assessments are independently audited by the Office of the Assessor General and must meet rigorous quality standards before new rating assessments are certified. They are not intended to be used as market valuations to raise funds from banks or as insurance valuations.
The new rating values ââwill be displayed to owners after December 8, 2021. If owners do not agree with their rating assessment, they have the right to object through the objection process before January 29, 2022.
City Council director of financial strategy and treasury Marty Read said it’s important for homeowners to remember that a change in a property’s assessed capital value doesn’t mean rates will change by a similar percentage.
He said the Council uses property values ââto distribute the rates it needs to collect among all taxpayers – it doesn’t collect more rates just because the capital value has gone up and it doesn’t collect less rates if the capital value has declined.
The actual rate increase for each property will depend on a number of factors, including:
- the overall rates of the Municipality âbudgetâ calculated each year in the Annual Plan.
- the change in the capital value of your property compared to the average change
- any change in the range of services provided by the Council
- any change in target rates or the Board’s rating differential.