Why battler suburbs are facing a big jump in rates
Among the many problems in the intray for new councillors, expected to be sworn in on Friday, is a looming problem threatening to cause fury in battler suburbs in the north and west.
Residents in many of those suburbs received an unpleasant surprise in the mail last week in the form of the latest land valuation on their properties from Queensland’s Valuer-General.
While the average rate of increase across the Gold Coast was an even 25 per cent, that far from told the full story, with much bigger hikes in suburbs where cost of living pressures are being most keenly felt.
In both Pimpama and Pacific Pines, the Valuer-General raised land valuations by an average of 45.5 per cent.
In Ormeau Hills the jump was 40.7 per cent.
In Highland Park the average rise in land value was 49.2 per cent and in Worongary it was a stunning 59.8 per cent.
The trouble for council is in other suburbs, most of them generally more affluent and close to the beach, it was a very different story.
Land valuations were up only an average of 6.5 per cent in Burleigh Heads, 6.1 per cent in Mermaid Beach and 5.3 per cent in Miami.
In Palm Beach, the average change since valuations were last arrived at
“It’s a conundrum – and one that it is all but impossible to see being solved without a significant increase in rates bills for homeowners in northern and western suburbs.
two years previously was exactly zero.
This presents an enormous headache for councillors when they sit down for budget meetings in the next few weeks.
Council uses land valuations to determine rates bills by applying a percentage to land valuation.
It does not mean, however, that valuation jumps of say 40 per cent automatically translate into a 40 per cent increase in rates bills.
In the event of a big hike in valuations, council will normally reduce the percentage it applies to avoid a steep rise in bills.
However the wide disparity in valuation changes across the city will make doing so extraordinarily challenging this year.
The system does not allow council to apply different rates to different suburbs.
So any cut to the general rate percentage in an effort to ensure bills don’t spike in Pimpama would lead to a tasty discount in Palm Beach.
Councillors also need to ensure they do what they can to balance the books.
It’s a conundrum – and one that it is all but impossible to see being solved without a significant increase in rates bills for homeowners in northern and western suburbs.
This would surely lead to a backlash, especially after an election campaign in which Mayor Tom Tate said he was focused on cost of living issues.
Already, many northern Gold Coast residents have been reacting with incredulity to the size of the jump in valuations on their properties. The pitchforks are being readied. “Ours went from 345k to 500k. So ridiculous,” one Pacific Pines resident wrote.
“820 sqm block – $355k now $510k. How much will our rates increase, hate to think,” another said.
And there have been many comments with this flavour: “Land valuation is increased for land tax purposes and in turn increase your rates. Money grabbing b---ards springs to mind.”
It does not help that ValuerGeneral Laura Dietrich stated high levels of immigration and infrastructure development played a role in arriving at land values.
“Since the last valuation two years ago, the Gold Coast City local government area has continued to see large numbers of people moving to the area from overseas and interstate,” she said.
“The changes in values we’re seeing is being driven by strong demand from investors and the amount of infrastructure development that’s happening in the area.”
The northern Gold Coast is seeing the lion’s share of immigration into the city, leading to clogged roads, hospitals and increased demand on everything from GPs to police.
Not all long-term residents are thrilled by this development. And now they are being told that they must literally pay for it.
The infrastructure excuse will also not delight people seeing beautiful bushland at their back fence replaced by the Coomera Connector.
Yet even people in Monterey Keys whose homes back directly onto the site of their road have seen their land valuations jump by 25 per cent.
Many of the suburbs recording the biggest valuation hikes were also among those worst affected by the devastating Christmas night tornado.
If rates jump in these areas, while remaining largely unchanged or even falling in places people see as being populated by the well heeled, the backlash could be significant.
In handing down her valuations, the Valuer-General has delivered not just many Gold Coast residents, but also their local representatives, some very difficult news.