New rating valuations on the way for Central Hawke’s Bay
Central Hawke’s Bay property owners will soon receive new three-yearly rating valuations in the post.
Updated values have been prepared for all 8,904 properties in the district by independent valuers Quotable Value (QV) on behalf of Central Hawkes Bay District Council. They reflect the likely price a property would have sold for on 1 September 2024, not including chattels.
Since the district’s last revaluation in 2021, the value of residential housing has decreased by an average of 9%. The average house value is now at $585,000, while the corresponding average residential land value has decreased by 19% to $175,000.
QV registered valuer Sophie Treder said Central Hawke’s Bay was one of a large number of districts across Aotearoa that had seen rateable values reduce this year after the previous triennial revaluation was undertaken at around the peak of the market.
“Following a strong end to 2021, a moderate downwards correction of residential values occurred over the back end of 2022. However, it has been a relatively stable residential environment in the 18 months preceding thee latest rating valuations,” she said.
“A strong first-home buyer market has maintained the lower level entry point, with larger residential properties feeling more of the pinch from rising maintenance, insurance and finance costs. These costs have also reduced the appeal of land and subsequent development, leading to a sharper decline in land values across the district.”
She said residential properties in Waipukurau had experienced the largest average declines in residential capital and land value movement – a 12% decrease in average residential capital value and a 25% decline on land values, compared to an 8% decrease on capital values in Waipawa and 20% on land values.
“Residential rent levels have continued to trend upwards since 2021 providing stable returns for investment rentals,” Ms Treder said. “The damage from Cyclone Gabrielle has also largely been remedied, although Pōrangahau does still have a small catchment of properties sitting in a ‘2C’ land categorisation.”
“While Waipawa was initially affected by the cyclone, it remains a popular choice for commuters North to Hastings and Napier,” she added.
Meanwhile, commercial property values have decreased by an average of just 0.2%, with values in the industrial sector increasing by 11% since the district’s last rating valuation in 2021. Commercial land values have decreased by 8.3% and industrial land values have increased by 5%.
“The industrial and commercial property markets in Central Hawke’s Bay have transitioned to a more cautious environment between 2021 and 2024. The industrial sector has remained resilient, driven by owner-occupier demand, and low interest rates in 2022 – though rising interest rates and construction costs have slowed overall activity. The commercial sector has seen weaker demand, particularly for upper-level office space, with vacancies increasing. Retail rents have softened more than office rents, reflecting reduced tenant demand,” Ms Treder said.
The average capital value of an improved lifestyle property has decreased by 5% to $715,000, while the land value for a lifestyle property decreased by 25% to $300,000.
“Lifestyle has generally followed a similar trend to that of the residential market, with values falling away from their 2021/22 peak. The influence of new subdivision rules, in combination with cost/financing constraints has seen an oversupply of lifestyle sections with extended listing periods. A good supply of lifestyle blocks within neighboring Hastings district has also added to the decline within the Central Hawke’s Bay District.”
The pastoral sector had an overall decrease of 6.6% under the 2021 values with this being largely in the in the land with an over land decrease of 7.1%. “The market for pastoral properties has weakened since the last revaluation with the impacts of major weather events, uncertainty around government policy, changes to the Overseas Investment Office, rising interest rates and the volatility within the forestry sector all influencing the drop-in values from the peak of 2021/22,” Ms Treder concluded.
The total rateable value for the district is now $8.8 billion with the land value of those properties now valued at $5.3 billion.
What are rating valuations?
Rating valuations are usually carried out on all New Zealand properties every three years to help local councils assess rates for the following three-year period. They are not intended to be used for any other purpose, including raising finance with banks or as insurance valuations.
They reflect the likely selling price of a property at the effective revaluation date, which was 1 July 2024, and do not include chattels. Any changes in the market since that time will not be included in the new rating valuations, which often means that a sale price achieved today will be different to the new rating valuation.
Rating valuations are calculated using a highly complex and detailed process that utilises all relevant property sales from your area. A large number of properties will also be physically assessed, particularly those that have been issued building consents in the last three years.
The updated rating valuations are then independently audited by the Office of the Valuer General to ensure they meet rigorous quality standards, before the new rating valuations are confirmed and posted to property owners.
If owners do not agree with their rating valuation, they have a right to object through the objection process before 16 May 2025.
