Market value vs council rates

I just got my mums rates notice and surprise its gone up again.
Gone up but $580 for the year.

My mum was told she could sell for 950 to 1.1 mil but offeres have been below 900k.

The rates notice conservative estimate says 900k.
So should you get close to 1 mil if selling?

 

My rateable value on my rates is less than half of market value.

Your mum's property is worth what someone is willing to pay for it - I wouldn't rely on the rateable value at all.

 

So how can rates be so high.if its.not what the property is worth

 

There would be an information booklet from Council that comes with the rates notice.

 

Have a read through this. Might help

Frequently asked questions - Valuer General of New South Wales

 

Nope doesn't really.
Says how its valued but doesnt say how this if it has a impack on market value

 

A, valuations are only done every few years (so behind the curve)
B, they are an average
C, they are conservative (mostly, as it's a PITA for council when contested)

I find Vic to be a rort, as it is land and "capital improved", IE: if you can afford to put a nice house on that lot you can afford to pay council more..............(for no extra service's)

 

The way rates are worked out is a bit complicated.

Roughly, Councils decide on a budget for the year based on what is needed (in my Council it’s been local road maintenance, public waste management, community hubs with libraries and maternal child & health centers - along with lifesaving clubs and sports pavilions recently) and that cost is divided up amongst rate payers at a rate in the dollar according to the value of their property.

Seems fair to me.

 

That's because rates in NSW and QLD are based on valuations of the unimproved land (i.e. they don't include the house) whereas rate valuations in Victoria include the value of the buildings.

 

I'm late to this chat, but I'm dealing with a situation which seems to be the opposite of some folk here. My uncle's home in Sydney may need to be sold to fund his aged care accommodation. He has let it go for decades, so the house is in such a state that it's uninsurable and 99% of buyers would knock it down straight away.

The local council's rateable value for the land alone is currently $1.7 million, but everyone I talk to says that's way OVER value on what the property would sell for, not undervalued. So in this case it seems the council is overvaluing the land.

 

Council doesn't do the valuation. Someone should have objected to the valuation when it was issued.

Speak with different people.

 

Thanks for your reply.
When you say someone should have objected to the land valuation - do you mean someone within the system, or my uncle?

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Scott No Mates, post: 1355537, member: 146"]Council doesn't do the valuation. Someone should have objected to the valuation when it was issued.

 

Sir I believe you are incorrect.
The Resentment service is not free nor cheap.

 

Valuations for rates and land tax

Victoria has annual revaluation of land based on homogenous parcels. The rateable charge per $,000 of land is set annually to ensure consistency in how users of land are assessed charges PLUS waste etc. Basically the sum of all councl revenue is determined then divided by total assessed land values to determine the rates charge per $1000 of land.

The rates are based on a capital improved value which considers what is on the land. I have no idea how each property is fairly valued this way. One may look pristine and be a horders house inside and the neighbour could have gold wallpaper. Valuation objections processes assume each owner knows the market value AND has a meaningful basis to consider it as excessive AND acts within the limited time period to object. The poor owner has the odds stacked against them. Prior to 2023 some regional councils did their own valuations but now the VG does / supervises it all !! Thats a worry.

The valuation process

To make a valuation, valuers collect and analyse:

• Property transactions, such as sales and rental transactions
• External/internal inspection data
• Historical government property data records
• Planning permit/building permit records
• Planning (zones and overlay) information
• Property transaction statistics
• Property title and occupancy details

The information enables a level of value to be established and applied to each property within a group of properties that have similar characteristics.

This doesnt explain how EACH property is respectively valued at market value.It suggests some will be over valued and other under valued perhaps

 

The owner.

 

As per later in your post
Valuation is based on comparable sales AND building permits.
My neighbor had a well maintained original home that had no building permits ever (cosmetic works only) whilst my home was smaller and a run down mess, both were valued against the house over the road that sold, my rates were $120pa less than my neighbor, eventually I put in to demolish the skillion and build a proper extension and my rate notice went to $900pa more than my neighbor (even though the houses were now the same size), the building permit was the trigger and council just have a formula on which to overestimate the value of works (thus improving their income next rate review)...