New QV rating valuations on way for Whanganui property owners

Whanganui residential and commercial land values have almost doubled in three years. Photo / Bevan Conley

Whanganui property values have increased by over 50 per cent in the last three years while land values have increased by over 90 per cent, according to new rating valuations for the Whanganui District.

Property owners will soon receive a valuation notice in the post with an updated rating value for their property assessed by Quotable Value (QV) Limited on behalf of the Whanganui District Council.

The QV analysis shows that on average, the value of residential housing has increased by 53 per cent since 2019, and the average house value was now $522,000. The corresponding average land value has increased by 96 per cent for an average of $247,000.

The total rateable value for the district is now $15.5 billion, with the land value of those properties now valued at $7.9b.

Property Brokers Whanganui branch manager Ritesh Verma said it was hard to say how the new valuations would affect market prices at this stage.

“The valuations don’t reflect things like kitchen or bathroom upgrades, which will of course affect the vendor’s asking price,” he said.

“The way the market has been for the past couple of years, vendors have been able to get from 50 to 70 per cent above the QV valuation, but it’s hard to say what the percentage might be in the current market. For the past couple of years, the median price for Whanganui has been around $400,000.”

Verma said it would be around six months before the impact of the new valuations on the real estate market could be accurately gauged.

Council chief financial officer Mike Fermor said property value increases would not equate to rates increases.

“Some people may worry that a 53 per cent increase in their property value means a 53 per cent increase in rates. That’s actually incorrect,” he said.

“When the council goes through the rates setting process each year, we work out the total cost to provide services and facilities [swimming pools, sports grounds, libraries, and parks] on behalf of our community – this is the amount we need to collect in rates.

“External factors that influence what we need to charge for rates are things like inflation, interest rate rises and supply chain issues, not property values. The amount it costs to run our district doesn’t change because property values change.

“What the revaluation can change is the size of your ‘piece of the pie’ compared to others.”

QV property consultant and lead valuer Simon Willocks said the increase in values reflected a national upward trend.

“Whanganui hasn’t been immune to the significant value growth seen nationwide in recent years, which was primarily driven by record low interest rates,” he said.

“Though that growth has fallen away from the height of the market, values remain well above where they were at the previous rating valuation in 2019.”

Rating valuations are usually carried out on all New Zealand properties every three years and reflect the likely selling price of a property at the effective revaluation date, which was October 1, 2022.

If owners do not agree with their rating valuation, they have a right to object before April 14, 2023.