2017 SOLGM Conference VALUATION ISSUES

Transcription

1 2017 SOLGM Conference VALUATION ISSUES Neill Sullivan, Valuer-General Land Information New Zealand 9 October 2017

2 Introduction The market has been on fire!- big increases across NZ in 2016!

3 The Market 2017 Revaluations - Capital Value increases 20-60% overall since 2014 most of it from late 2015 and 2016 older sales time adjustment LVR s & The Election have taken some steam out Vacant land increases more dramatic than improved property = LVR deposit ratios lower for new homes (20%) vs investors (40%)

4 The Market Councils under pressure to release new development land & increase existing densities - Proposed Plans and Structure Plan changes fuelling the market Valuer s need to be more aware of plan impacts to understand key sales! Resource Consents and Land Use Consents must be notified to VSP regularly VG seeing many examples where valuers not aware of consent based development potential

5 The Market Major roading projects and Inland Ports driving values widespread impacts of major development hubs throughout regions not just the district they physically reside in NZ is transforming into adolescence we re entering the teenage years and growing pains are multiplying these things and mood swings will always have an influence on the property market keep vigilant and talk with your VSP regularly!

6 Rating Valuations Rules Review What s happened since SOLGM 2016?

7 EVALSTARS Review 2017-Issues Identification Paper-Rating Valuations Rules Review

8 REVIEW FINDINGS No demand for wholesale modifications in the system Need to ensure the rules are fit for purpose in a digital age Data seems to be deteriorating - rules a key mechanism to address this concerning at a time when digital data sources have never been better

9 REVIEW FINDINGS Should the minimum standards be raised? Access to rating and sales data Variable interpretation of the rules across the country

10 REVIEW FINDINGS More detail about what fields in the Appendix actually mean could be useful for understanding and consistency - Simplifying language definitions The land use codes need upgrading

11 REVIEW FINDINGS Ratepayer communication options need to take account of electronic methods and mobiles New Data fields = Council & VG Cost and Transition issues Landonline doesn t talk to territorial authorities and their valuation service provider systems very well eg Title & Legal Description

12 REVIEW FINDINGS Emerging Issues Keeping pace with technology AVM s Demands on rating data for other purposes Expectations for greater access to data Central repository for ratings valuations data Potential demands by central government for data Crowd sourcing opportunities

13 New Rules Next Steps Further EVALSTARS report - changes needed to the back end of the Rules covering: Move from flat file structure to a dynamic, real time database New data fields school zones, seismic rating, year of modernisation, number of bedrooms, flooding codes, etc Automated population for certain data fields Title, Address, Owners Name(s) etc from an authoratative source

14 Other Rule Changes Registered Valuer to be a member of NZIV branch for TA district Increasing the Public Content of DVR eg Land use data, Mass Appraisal data, sale details, digital photos, TA parcel identification number New register required for ratepayer supplied questionnaire information Adopting International property measurement standards

15 Other Rule Changes Provision of S16 RVA analysis for revaluations Increased requirements for sale property inspections not general inspection of unsolds All objections requiring a new inspection and ratepayer contact remove 15% rule

16 Other Rule Changes Individual worksheets showing how values calculated at each revaluation for all Commercial, Industrial and productive Rural properties New roll maintenance triggers eg fast track planning processes; Resource consents issued TA inventory audit of current VSP prior to tendering contract improved due diligence

17 Power of Data or Alcohol Effect on the Brain?

18 Better Data = Better Values Next big move in valuation accuracy will be driven by data utilisation not more compliance Rules! Councils report less low value phone and inquiries when ratepayers can get reliable Rates and valuation data from alternate sources - Homes.co/Trademe/QVonLine Moves their contact to fewer but higher value questions and interactions

19 Getting Good Data

20 Getting Good Data Name: Haymond Roran

21 DVR Data Quality Cycle Councils promoting Direct online Ratepayer checking of DVR details High Quality DVR Data More Accurate and Cheaper Rating Valuations Data Freely Available Automated Valuation Models Innovative Users

22 DVR Still Most Wanted Dataset DVR DVR most wanted - freely available & for free (if possible) consolidated, national dataset in real time Christchurch have freed up their data

23 Other Rating Valuation Issues

24 Legal Update Ngati Whakuaue Court of Appeal case pending LVT Decision requiring a discount be applied for land with non alienation condition under Reserves & Other Lands Disposal Act Land is developed commercially to highest & best use Multi storey Tourist Hotel

25 Legal Update Appeal based on view that RVA takes primacy over ROLD in rating valuation matters under RVA we can assume a notional sale - alienation restriction is personal to the owner (NW) & not the land This is not MFL so Mangatu Guidelines not applicable Awaiting hearing date

26 Notice of Sale - LandonLine Sales notices into LINZ - match Parcels, Owners & Titles to what s sold - Councils then notified by LINZ Councils still check accuracy of sales price A lot of Council support for this initiative - Work in progress at the moment

27 Legislative Changes Comprehensive review of Te Ture Whenua Maori Act on hold see what post-election appetite is for this proposal was to bring in a new regulated process for MFL rating valuations Orders in Council for Kaikoura and Hurunui Districts to modify roll maintenance process Review of Valuers Act may not proceed not enough noise about registered valuers market

28 Rule 2.4 Rating Units Proposed new Rule criteria for leasehold land that is surveyed & registered under Land Transfer Act 10 years or more and lessee owns improvements OR 35 years or more irrespective of who owns the improvements (if any) Wellington Council proposal just amend 10 year criteria to remove improvement ownership few occupation leases registered new consultation Watch for new land tenures creative developers

29 Irrigation Schemes Noise seems to have come out of this issue Revaluation approach utilising a stakeholder agreed methodology which recognises potential profitability restrictions for a Co-Op business Rating value of water flows from the scheme to the farmland it serves easily understood & no loss of rating value

30 Rural Digital Mapping Project OVG working with Landcare and ECAN to develop digital mapping of rural land classes new slope criteria to group & display land classes

31 Select Parcels that match property

32 Vector Slope Map (Polygons) Can further simplify map to polygons of predominantly One slope class.

33 Areas of Slope Class from DEM Existing Valuation data (ha) Mean DEM (ha) Difference between existing data and Mean DEM (ha) Flat Undulating Easy Hills Medium Hills Steep Hills Very Steep 0 0 Total hectares

34 Rural Digital Mapping Project Successfully mapped land classes and calculated areas for all farms in Timaru District needs some ground truth testing of accuracy Plan to do a North Island district early 2018 then roll out across the country All going well this information may be available for all 2018 revaluations

35 Harnessing Council IT Riches Many Councils now have high quality GIS and mapping tools for their districts Discuss with your Valuers the opportunities for them to directly access your databases Thematic mapping, land and resource consent data, floor plans etc - tell them what you ve got embed council maps & data in VSP system District Plans with updated RC s Thematic Maps

36 Councils Central to DVR Quality

37 Contestability Auckland & Opteon (Australia) DVR management with valuation module & operational valuation role for ex Rodney area flying to Auckland after this to do certification audit Entering a new era of contestability? Whangarei & Matamata-Piako have changed VSP in past year

38 Some Good things to finish on Still intending to waive OVG fourth quarter cost recovery fees 2016 revaluation objections at near record low of 1.8% More councils promoting ratepayers checking their property data on line & free DVR data