Frequently Asked Questions About Ratings Valuations
What is a rating valuation?
Rating values (RVs) for all types of property are compiled under the Rating Valuations Act 1998. (RVs were previously known as Government Valuations or GVs) These are used as a basis for levying local authority rates.
Rating values consist of three main components;
- Land Value (LV),
- Improvement Value (VI)
- Capital Value (CV) being the total of both LV and VI
Rating Values do not include chattels.
Whilst rating valuations are based on market sales, they are a snapshot of the property market at a single point in time.
What is the difference between a market valuation & a rateable value?
A market value on any property will look at what other properties of comparable size, improvement, etc have sold for in the recent past.
Rating values (RV’s) are a snapshot of the market on a single point in time and these rating values must preserve uniformity within existing roll values of comparable parcels of land. This uniformity must be maintained as the values are used for rating purposes and it is about providing a fair rating valuation base.
The values on the District Valuation Roll (DVR) represent a level of value at a single point in time (a snapshot of the market as at the last revaluation date). The value relativity with the other properties needs to be maintained. Therefore, any updates to the DVR must always be backdated to the last revaluation.
Properties are valued using a mass appraisal system.
Note: Chattels are not included in a Rating Valuation.
What do the terms capital value, land value & improvement value mean?
The assessment of the most likely selling price had the property been sold on the open market at the date of the most recent revaluation. The capital value includes the principal building, all other buildings and other improvements on the land, plus the value of the Land.
The assessment of the probable price that would have been paid for the bare land at the date of the most recent valuation. This includes development work such as drainage, retaining walls, and leveling but does NOT include any buildings or other improvements to the property.
Improvements add value to the land i.e. buildings, drives, paths, fencing etc. Improvement value is the difference between the Capital Value and the Land Value. The improvement value does not necessarily reflect the cost of the improvements on the property.
Who should I contact about my rating valuation?
Please contact your local authority first. Opteon, being contracted to a local authority for the provision of rateable values, acts on instruction from the local authority.
Phone your local council office for further information.
Can a rating valuer enter my property?
Rating valuers have “Powers of Entry” on any land for the purpose of assessing rateable values on a property. This is authorised under Section 45 of the Rating Valuation Act 1998. This section of the Act also requires the owner, occupier or manager to answer any questions for the purpose of enabling a correct valuation to be made.
Property inspections may be carried out by Opteon rating valuers for the following reasons:
When a building consent or subdivision is completed, Opteon valuers are required to inspect each property and adjust the rating values where necessary.
When a property owner objects to their rating valuation
Most sales occurring during the year of the districts revaluation will be looked at.
Sales are the most important evidence of market levels at the effective date of valuation, so the accuracy of the sale detail is often confirmed by an inspection and discussion with the owner.
When a property sells, the sale price is compared with its rating value. Based on this comparison, if the sale price falls outside what is considered normal market movement, an inspection is required to confirm both the accuracy of the rating valuation and sale detail.
All this work requires a high volume of property inspection, as this is an essential part of providing accurate rating values. In most cases, due to the large number of inspections completed each day, appointments are not made.
Can I object to my property valuation?
Yes. Property owners can lodge an objection to their revised property values once a revaluation has been completed. Each local authority is responsible for advising property owners of their updated valuation after the new values have been audited by the Office of the Valuer General.
The updated revaluation notice will be posted to all property owners by the local authority. This will include information on the objection procedure.
The objection period is for a limited time – normally one month after notices have been issued. Objections received within this timeframe (indicated on the rating valuation notice posted to property owners) are provided free of charge.
Property owners objecting to their valuations outside the objection period, will be required to be pay the costs of a “valuation review”.
Information regarding how to object to your property valuation is generally available on the council websites. Forms to be completed are generally available to download from the council website. Alternatively call into you local council and request forms to complete.
What is the role of the Valuer General?
The Office of the Valuer-General sets minimum standards for rating valuations and maintenance of the District Valuation Roll (held by each local authority). After every revaluation of a city or district, the values are audited by the Valuer Generals office before being released to the council.
Other duties include:
- provides independent quality assurance of valuations for rating purposes
- certifies rating valuations to local authorities
- provides technical advice to Government on valuation and the valuation services sector
- monitors and audits the work of rating valuation service providers (VSPs)
- is ex-officio chair of the Valuers Registration Board
- sits on the council of the New Zealand Institute of Valuers(NZIV)
- For more information, refer to www.linz.govt.nz or www.legislation.govt.nz
How often are revaluations done?
In New Zealand, it is common for most local authorities to conduct revaluations of their district every three years.
Local authorities, in some areas, may carry this out annually.