Rates won't change much despite fall in property values
THE value of properties in some areas has dropped by almost 40% but that doesn't mean general rates will follow suit.
The State Government released its land valuations this week. On average, properties in the Gladstone Regional Council area are down in value by 14.6%.
That should not come as a surprise since between July and September last year, the average house price had already fallen 13.1% to $380,000 and units were down 24.9% to $330,000.
This week's report encompasses 28,443 properties worth $5.6 billion and again, multi-unit residential properties were the worst hit.
Homeowners in West Gladstone are facing a decrease in property value of 20.3% while those in Toolooa are down 39.7%.
The residential market in Gladstone peaked mid-2012.
Queensland's Valuer-General Neil Bray said an oversupply had led to dramatic decreases in some areas of the Gladstone region, including Barney Point where the average purchase price per house was down $45,000.
But it's not all bad news for areas with a massive decrease, because those properties are likely to see a slight decrease in their next rates notice.
Rates are set based on a number of factors, including land valuations, consumer price index and the amount of money needed to balance the council budget.
Gladstone Regional Council CEO Stuart Randle said although the depressed valuation would not mean a decrease in general rates, residents in areas like Toolooa should see a small decrease.
Mr Randle likened the distribution and collection of rates to dividing a cake where property valuations determine the size of each piece, but overall the cake remains the same size.
"While this might sound simple, it becomes complicated when property valuations change by different amounts, meaning the relative share of the cake might vary each time a valuation is done," he said.
Major drops in property values:
West Gladstone: -20.3%; Telina: -29.6%; Toolooa: -39.7%; Glen Eden: -29.4%; Barney Point: -25%; Mount Larcom: -25.5%; Agnes Water: -9.5%; Ambrose: -25.0%; Boyne Island: -15.4%; Clinton: -22.1%.
Facing Island, Miriam Vale, Seventeen Seventy, Turkey Beach, Curtis Island, Boyne Valley, Southend.
How are rates calculated?
Each property is placed in a different category, depending on use.
In Gladstone Regional Council area, there are 20 categories.
The council calculates a rate charge by multiplying a property's average rateable value by a dollar rate.
Eg. Rates for a house worth $220,000 is calculated by multiplying the dollar value by the rate in the dollar of property valuation set by council.
For a category one residential property; $220,000 x 0.00742 = $1632.40 + fees and charges