Kaikoura District Revaluation 2018 Gail Smits and Kris

Kaikoura District Revaluation 2018 Gail Smits and Kris Rodgers 31 October 2018 1

Agenda • • Process & Tools Results Key Dates Questions

Process • Rating values assessed in accordance with legislation • Property data updates – constant process over 3 years • A detailed market analysis and sales inspection is undertaken across all property types • Individual valuation worksheets are used for majority of business and rural properties • Roadside inspections by valuers to check and review valuations • OVG(LINZ) audit – 3 week process – approved by auditors on 19 October 2018

Kaikoura Issues • Rating values are a ‘snapshot’ of the market at a single point in time – 1 September 2018 • Known unrepaired earthquake damage is reflected in the revaluation values. • An extensive publicity drive to encourage property owners to advise of unrepaired earthquake damage to their properties has been undertaken. • Physical inspections and Council records have also further identified some property damage • The Hurunui/Kaikōura Earthquakes Recovery (Rating Valuations Act—Kaikoura District Council) Order 2017 ceases for rating purposes when this revaluation takes effect. – 1 July 2019

Capital Value Change since 2015 30. 00 26. 5 25. 00 Percentage Change 20. 00 15. 00 10. 2 10. 00 6. 3 6. 4 3. 8 3. 7 5. 2 3. 7 5. 00 0. 00 Overall Residential Lifestyle Rural Business Forestry Utilities Other

Capital Value by Sector 2018 Capital Value 2015 Capital Value 10% 39% 26% 8% 17% Business Farming Lifestyle Other Residential 38% 27% 8% Business Farming Lifestyle Other Residential 17% 6

Residential Dwelling Growth since 2015 30. 0% 25. 0% 20. 0% 15. 0% % CV Change 10. 0% Typical CV % Change undamaged house % LV Change 5. 0% 0. 0% Kaikoura Town -5. 0% South Bay Seaview Kaikoura Subdivision Ocean Ridge

Average House Residential CV & LV Ocean Ridge Seaview Kaikoura Subdivision South Bay Kaikoura Town 0 100, 000 200, 000 Average 2018 LV ($) 300, 000 400, 000 Value ($) Average 2018 CV ($) 500, 000 600, 000 700, 000

Residential • Some properties have received significant value reductions as part of the 2018 general revaluation to reflect their current damaged condition. This damage is not included in the 2015 values. • Ocean Ridge Subdivision has seen a decline in land values with many vacant sites selling for below their 2015 LV. • Seaview Kaikoura has seen good growth in values with a Capital Value adjustment of about 1. 25. • Large localised lateral displacements as a result of the 2016 earthquake occurred around Lyell Creek resulting in significant ground, housing and infrastructure damage, and is reflected in the 2018 revaluation. • Demand for residential properties has increased significantly evidenced by a high volume of sales activity and upward pressure on price levels.

Business Property Value % changes 2015 2018 8 6 4 CV change (%) 2 LV change (%) 0 Commercial (Overall) Industrial (Overall) Commercial Accomodation -2 -4 11

Business Property • There has been some market growth since the 2015 revaluation due to; • Slight increase in some retail rental levels. • Tourism growth • High demand on accommodation due to the influx of rebuild/recovery workers into Kaikoura following the Earthquakes • Some properties with substantial value reductions due to unrepaired earthquake damage • Motels generally showing growth but average overall values reduced due to some valued with unrepaired damage. 12

Rural Lifestyle • Lifestyle market steady, with majority of demand close to Kaikoura town. • Average Capital Value of developed lifestyle property is $570, 000 up 3. 1% • Average Lifestyle block land value $285, 000 up 5. 6% 13

Rural % Value Movement 2015 -2018 30. 0 25. 0 20. 0 15. 0 CV change (%) 10. 0 LV change (%) 5. 0 0. 0 -5. 0 Dairy Pastoral Specialist Horticulture Forestry -10. 0 14

Average Rural Values Forestry Horticulture Specialist Pastoral Dairy 0 mil 1 mil Average 2018 LV ($) 2 mil Value ($) Average 2018 CV ($) 2 mil 3 mil 15

Rural key points • Current Dairy farm environment less positive – 5. 1% CV reduction and 5. 3% LV reduction • Pastoral CV increase of 8. 8% on average • Mycoplasma Bovis has created uncertainty in the rural sector

Overall Results $1, 800, 000 $1, 600, 000 $1, 400, 000 $1, 200, 000 $1, 000, 000 $800, 000 $600, 000 $400, 000 $200, 000 $0 Capital Value Land Value 2012 Values 2015 Values As at Sept. As at 2015 Sept. 2015 Values 2018 Values As at Sept. 2018

What if my property has earthquake damage? Your new 2018 rating valuation should include the impact of any earthquake damage, so it may be very different to your 2015 rating valuation. If your property has significant damage that you do not think has been reflected in your 2018 valuation, you can make an objection. What if I am unhappy with the value that was issued? If you don’t agree with your new rating value you have until 6 December 2018 to object. If you’re thinking about objecting phone QV on 0800 787 284 to discuss your concerns. The back page of your owners’ notice letter also has more information. If you have any questions about rating valuations or objecting you can also check the frequently asked questions at: www. ratingvalues. co. nz What does the revaluation mean for my rates? The new values will be used for rating purposes from 1 July 2019. 2015 valuation property values will be used for the current 2018/19 rating year (1 July 2018 - 30 June 2019. ) Generally, if your property value has increased/decreased more than the averages for the district, your rates will change as a result of the revaluation. If your property value only changes as much as the average change across the district, the rates you pay are less likely to be impacted. 18

Objections • Call QV on 0800 787 284 in the first instance, to discuss your concerns. • Owners who consider their values incorrect because of earthquake damage not reflected, or recent repairs not assessed, should object to their values with supporting reasoning. • Can be lodged on line § www. ratingvalues. co. nz • Objection close date 6 December 2018 § Objections can’t be lodged after this date.

Key Dates • Effective Date of Valuation: 1 September 2018 • Public Notice date: 24 October 2018 • Owners notices posted from 31 October 2018 • Objection period closes 7 December 2018 • Used for Rating Purposes from 1 July 2019

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