Winners and losers in house valuations
Across Wellington house prices fell by 3.5 per cent on average, but areas that experienced the largest drop-offs shouldn?t expect a rates decrease says Porirua City Councillor Euon Murrell.
Quotable Value released new valuations that will be used by Wellington City Council to set rates for the year starting July 2010. As Tommy's Mana branch manager Mr Murrell covers from Tawa to Pukerua Bay and says a shortage of properties and strong demand had stopped the bottom falling out of the market.
?It will be interesting to see where the values go after time; it takes time for these valuations to work through.
?I?m not that hung up about RV?s [government valuations] because it really depends on the market value,? says Mr Murrell.
There is a common belief that when house values fall council rates will follow, but this isn?t the case.
?It doesn?t mean a reduction in rates, the city still needs an income and will adjust their rates formula to the level of income they need,? Mr Murrell says.
Tawa central was hit the hardest, where average house values plunged 9.6 percent to $360,000. Because the whole market has seen high growth recently, Mr Murrell says it?s odd that Tawa took such a fall.
?The growth applies to all of market, and time will prove if they have it right or wrong.
?The market will decide on the houses value, not the government valuation,? he says.
Tommy's Johnsonville branch manager Ron Beccard agrees that the market sets the value of houses.
?It has not affected us at all because there is a shortage of property here.
?The buyers are looking to buy, and when you have three to five people looking to purchase it keeps prices at a certain value,? says Mr Beccard.
He covers Johnsonville, Churton Park and Newlands, all suburbs where house values fell by less than one per cent. Ngaio also fell by only one percent.
?The area has done pretty good, it has depended on supply and demand, because of a shortage of properties,? he says.
Because the valuations are ?fairly new? they won?t affect any changes for some time, he says.
?
