Have You Heard About The Changes To Auckland Rates?
As we all know, the Auckland Council has changed the way they are going to collect rates from home owners.
Oh … hadn’t you heard!
The Power Of A Monopoly!
Wouldn’t it be great to have a business with no competition and the ability to make the rules … in law!.
Well that is what it seems we have with the Auckland Council and given they are short of cash they are keen to push through changes that will help balance the budget.
They think they can change the Auckland rates whenever they want … and maybe they can.
Did You Know….
When I heard that the Auckland Council was changing the way they collect the Auckland rates I was a little surprised … not because they were changing the basis of the rates, but because I had not heard about this before!
How Have Auckland Rates Changed?
This is the extract from the Auckland Council website;
From July 2012, the council introduced a single rating system so that over time, all properties of similar value and use will be charged a similar amount of rates. The general rates for all properties are now rated on their capital value, rather than annual or land value. Auckland Council carried out its first region-wide revaluation in 2011 and these new property values are used for rating purposes from 1 July 2012 through until 30 June 2015. The next region-wide revaluation is due to take place later this year with the new values being used for rating purposes from 1 July 2015
I admit it was not easy to find, but this is the link;
The Rates Calculation Changes
Until now your Auckland rates have been based on the land value of a property, but from 1 July 2015 the general rates will be calculated on the capital value of the property.
The capital value is the value of both the land and improvements.
We selected at random a property at 1/ 10 Abbeygate Street Birkdale. The land value is $215,000 but the capital value is $400,000 which is significantly more – and the valuation was from July 2011, with new valuations are due out soon.
You would expect that the new valuation will be a lot higher.
You would also hope that the rates calculation will not be the same, otherwise what would the rates increase by?
But … Didn’t Len Promise Low Rates?
Auckland mayor Len Brown campaigned on keeping rates low, saying “I am committed to keeping rates low” when he campaigned.
But recently TV3 reported that “Mayor Len Brown promised before last year’s election to cap rate rises in Auckland at 2.5 percent, but capital spending under the current 2012-2022 long-term plan (LTP) would require a rates rise of up to 4.9 percent” so what should we ratepayers believe?
Yes, what should we believe?
Rates Increases Will Hit The Average “Jo” Too
These Auckland rates increases are not only going to affect home owners.
As Jo Holmes
states; “it’s both ratepayers and renters who should be concerned about higher rates” and it most certainly will!
She says that landlords will need to recoup the extra expenses and that will force up rents as well. so while the new rates structure may seem like another tax on the rich, the rates increases will hit the average “Jo” just as hard.
How Much Will My New Rates Be?
At this stage we don’t know.
We do not know how they will be calculated and we don’t know what the new values of property will be.
The new property valuations are due out late this year – maybe next month (September) and most ratepayers will be interested to see how they value.
Any changes to the Auckland rates are not due until July 2015.
But What Can We Do?
They say knowledge is power, and at this stage we do not know enough; however this does not stop us from asking questions.
Soon enough we will learn more and then we can start asking the serious questions of Len and his team.