Rates burden hits the poor

Homeowners in some of Hamilton’s poorest suburbs can expect to shoulder a larger share of the city’s rates bill from July.

Hamilton City Council’s latest property valuations have been released and show a 57% increase in the city’s average residential property value during the past three years – from $587,645 to $922,838. Rating valuations are a snapshot in time and reflect the likely selling price if a property had sold on September 1 last year.

And while Hamilton has experienced record growth in house and land prices citywide over the past three years, the strongest price uplifts have occurred in some of the city’s most deprived suburbs.

‘‘There are some areas like Nawton through to St Andrews, Fairfield and Enderley as well, that are increasing at a higher level, and some parts of Frankton as well,’’ council’s financial support services manager, Matthew Bell said.

‘‘The majority of that [capital value growth] is just driven by the development of some land within those areas. It’s quite common to see houses that have been removed and new duplexes and other developments go on.

‘‘The valuations are driven by the market, so they’re looking at market sales and evidence to determine what those changes should be within those areas.’’

Property values in Maeroa and Nawton/Grandview Heights have increased by 63.4%, while Beerescourt (63.1%), and Fairfield/Woodstock/Enderley (60%) all registered higher than average growth.

The strongest growth in properties’ capital value were experienced in Peacocke and Rotokauri (138.6%).

‘‘Some of those properties [in Rotokauri and Peacocke] are those high-value large blocks of land, large parcels of land, so it’s those ones that are driving up the average,’’ Bell said. The revaluation does not affect the amount of rates collected by the council in the 2022/23 financial year.

However, ratepayers whose property values increased by more than the average 57% will

pay more rates.

The rating change caused by the revaluation comes on top of the proposed 4.9% rates hike signalled in the council’s draft annual plan.

Hamilton mayor Paula Southgate said it’s disappointing residents in the city’s poorer neighbourhoods will take on more of the city’s rates take. She expects rates affordability will become more of an issue for residents adversely impacted by the revaluation.

‘‘I’m sure we will hear from some of those property owners, some of whom will be quite distressed about the increase in their rates,’’ Southgate told Stuff.

‘‘The market price increases are what they are, and it’s not something the council has any control over.

‘‘And rating has never been an exact science, or a totally fair one, and there will always be winners and losers.

‘‘I feel for those people in those lower socioeconomic areas because you assume they’re less able to afford their rates.

‘‘I do know this is going to hurt people.’’ Council staff are presently assessing how the revaluation will impact each homeowner’s rates. This work will be shared publicly in the next few weeks.

Councillor Rob Pascoe, who chairs the council’s finance committee, said the significant uplift in property values in some older suburbs reflects the high prices developers are willing to pay for homes on larger sections.

Although ‘‘mums and dads’’ in suburbs such as Nawton, Fairfield and Enderley will end up paying more rates, many are presently paying less than the city’s average rates bill of $2887.

Hamilton’s revaluation was independently completed by valuation company Opteon.

The capital values for retail and office property have increased, on average, by 31%, while the capital values for industrial property has increased by 75% on average.

Property owners can lodge an objection if they don’t agree with their new valuation.

Objections have to be lodged before June 8.