Recent reassessment of property values January 22, 2021 Listen How do valuations affect rates? Property owners in Rangitīkei may be wondering what the effect of the recent reassessment of property values will be on their rates. Every three years, Quotable Value New Zealand (QV) reassesses property values (land value and capital value). Below, you can see the total Rangitīkei District capital value for each of the last three assessments: 2014: $3.774 billion2017: $4.461 billion2020: $6.262 billion “The recent rise we have seen in property values assessed by QV is significant and quite varied throughout the District. However, it is in line with increases elsewhere in rural New Zealand,” said Dave Tombs, Rangitīkei District Council’s Chief Financial Officer. “We have put together this information to help ratepayers understand the effect it will have on their rates.” Every year, Council decides through its planning processes how much money is required to pay for the services it will provide for the next 12 months. From there decisions are made as to how it will be paid for. Every third year the process is more involved as Council develops a Long Term Plan that covers the next 10 years. The outcome of this analysis is summarised on each rates assessment. Some of the terms you see on your rates assessment include: Uniform Annual General Charge: This is a generic charge applicable to each dwelling and is for specific district-wide services that all ratepayers enjoy. This rate is determined through the Long Term Plan and Annual Plan process. General Rate: This rate is based on the Capital Value of your property. Roading District Rate: Specific rate to pay for road maintenance in each ward and is based on the Capital Value of your property. There are other charges for specific services relating to the property, such as stormwater, sewerage, solid waste and potable water. Mr Tombs said only the general rate and the roading district rate are based on the Capital Value of each property – therefore both these rates will fluctuate to different degrees after QV valuations are applied. “It’s important to understand that an increase in property value does not mean a corresponding increase in rates” said Mr Tombs. “Property values only have an impact on two of the ten or eleven lines that typically make up a residential rates assessment.” Mr Tombs said that further information regarding this process is included in the current Long Term Plan that is available on Council’s website. Rangitīkei District Council will use the new valuations to determine rating that will take effect from 1 July 2021. More information What are rates? In New Zealand, councils are funded by a form of property taxation known as rates. Every three years, each District and city is revalued to set the values on which council rates are based for the following three years.Who is Quotable Value New Zealand? It is a State-Owned Enterprise, independent of Council.What is the rating valuation based on? It is based on two things:What would the value of a property be if sold by a willing seller to a willing buyer on the valuation date? The valuers assume the property is for sale and then use current sales histories and other information to assess what the property would probably fetch if it was sold on that day.What is the best use of the property? The valuers consider what a new purchaser might do with the property to maximise its value. The valuation is made on this “highest and best use” basis, rather than the existing use. For example, a smaller pastoral block may have a higher value as a lifestyle residential property, and a smaller farming property on the outskirts of a larger urban township may have a higher value as a residential subdivision.When did the revaluation occur? QV undertook a desktop revaluation on the same day across the Rangitīkei District in 2020. In November, QV advised property owners of the new valuation by sending them a notice.When will the revaluation affect my rates? Rangitīkei District Council will use the new valuations to determine rating beginning from 1 July 2021.When will the next revaluation occur? In November 2023.