Landlords face higher rates after valuation anomalies
Wednesday 29 December 2010
Inaccurate rating valuations have left some Hutt City commercial property owners facing excessive rates payments, claims Bayleys Valuations Chris Orchard.
Orchard said that in the wake of the release of new rating valuations for commercial property in Hutt City, it has quickly become apparent that there are examples of commercial and industrial property owners and occupiers paying rates that are too high.
Orchard said that as values for many commercial and industrial properties had steadily fallen over the past three years, some rating valuations are now considerably higher than what the properties were actually worth according to sales.
"Sales data available through the various land registry databases is showing an increasing pattern of discrepancies between actual market value and the council's perceived value for rating purposes."
"This means that for every $100,000 that a property is overvalued, the extra rates burden is in the order of $1,000 per annum. With rating valuations only reviewed on a three year basis, any excess is fixed for the full three years. A $1,000 excess therefore becomes $3,000 over the three year term - and in the current business climate that is a substantial sum for many businesses."
Orchard said to rectify an anomaly, commercial property owners had to lodge an official objection with Quotable Value - the company charged with undertaking rating valuations for Hutt City Council.
The last date for lodging objections is January 18, 2011.
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