Auckland Council delays new CV release for third time

Author
Ben Leahy, NZ Herald,
Publish Date
Tue, 30 Nov 2021, 5:01PM
(Photo / File)
(Photo / File)

Auckland Council delays new CV release for third time

Author
Ben Leahy, NZ Herald,
Publish Date
Tue, 30 Nov 2021, 5:01PM

Auckland Council valuations have been delayed again after being told it needed to do more work on its numbers. 

It means city home owners will now likely have to wait until March next year to find out what their property's new CV is. 

The new CVs - formally known as capital values - were expected last year. 

However, council pushed that date back to October this year, before delaying a second time and saying the CVs would instead be out next month. 

The council today said it is delaying the CVs for a third time until March. 

It said the Office of the Valuer General had inspected the latest valuation results and found more number crunching was needed. 

"The audit conducted by the OVG determined that the council and its valuation partner Quotable Value need to do more work on the values before they will be ready for release," the council said. 

Wellington home owners received their new citywide valuations today with the local council experiencing no Covid delays. 

Auckland Council blamed the Covid-19 pandemic for contributing to the delays. 

"The Covid-19 pandemic has added layers of complexity, which have affected the council's ability to complete the revaluation this year," it said. 

A source of fascination to property-mad Kiwis, CVs can affect the prices homes sell for as well as the council rates bill. 

Homeowners wanting to sell typically hope for a new higher CV in the belief it might help convince buyers to pay more. 

Banks sometimes also lend more money to people whose homes have higher valuations. 

On the flip side, home owners may get a higher rates bill if their new CV jumps too much in value. 

CVs are typically released every three years - Auckland Council's last CVs were calculated in 2017. 

The council was last year given permission to delay the Auckland revaluation process, after arguing that attempts to estimate home values in the uncertain market created by Covid-19 would likely produce distorted results that might be unfair to home owners. 

It then restarted the process this year by pretending every city home had been sold on June 1, 2021, and estimating the most likely selling price for each one. 

This is done "by analysing recent property sales information, resource and building consent data and undertaking sample inspections to establish an updated picture of land and capital values across the city", it said. 

These valuations must legally be approved by the Valuer General. 

"Ratepayer confidence is paramount therefore it is crucial that the OVG completes a detailed audit process," it said. 

Once the CVs are finalised, they will be used to determine every property owner's rates for the 2022/2023 rating year, with the rates bills kicking in from July 1, 2022. 

When they are finally released, home owners can expect their new CVs to be much higher than in 2017. 

The city's average property value in 2017 was just over $1m, but has now jumped to $1.5m, according to analysts Valocity. 

The booming growth in the past two years has meant it's become common for homes to sell for hundreds of thousands of dollars - if not millions - above their CVs. 

A Sandringham home on Hazelmere Rd is among the latest homes to fetch a stunning price as it sold for $3.56m at auction last Wednesday. 

The home has four bedrooms, a swimming pool and large block, which helped it go for more than $2m above its 2017 $1.2m Auckland Council valuation. 

Another 1970s North Shore home on Sequoia Pl in Sunnynook also recently earned its owners close to $2 million profit in just one decade of ownership after fetching $2.4m at auction. 

Not only is that almost $2m higher than its $430,000 purchase price in 2010, but is also $1.4m higher than its 2017 Auckland Council valuation. 

Although CVs play a role in helping setting rates bills, they do not change the total dollar amount the council collects from rates. 

The council instead decides how much money it wants each year, and then uses CVs to help work out the share each home and commercial property owner pays. 

The council has already decreed it intends to raise $2.3 billion from rates in the 2022/2023 financial year – the first year the new CVs come into effect. 

Ratepayers have a right to object to their new CV value if they do not believe it is accurate.