Are Auckland’s New Property Valuations Too High?

Auckland property owners received their new property valuations in October, with many homeowners predicting that the increased values will send their rates bills sky high. Which leads to the question as to whether or not the property values in Auckland are too high?

With hours to go until the closing of the official objection period, the Auckland Council had received 8,643 submissions from Auckland property owners upset with the new valuation the council has given their property. These properties will have their capital value re-evaluated by July 2015, just in time for the start of the next re-evaluation period.

With the residential property values having risen on average 34.8% since 2011, Auckland ratepayers have been concerned that their rates will also increase substantially, leaving some homeowners unable to pay the new unprecedented high costs. But the council has been quick to quash this by saying that homes on average will only rise approximately 2.5%.

2015 Mortgage War Predicted
Accounting firm Price Waterhouse Coopers are predicting that our five largest banks will start an all-out mortgage lending competition war early on in 2015. With only 28% of mortgages on floating rates at the end of September, compared to 44% in 2013 and 63% at the same point in 2012, homeowners are taking advantage of lower fixed interest rates and fixing their loans rather than floating them.

This lead PWC to say that it sees ANZ, ASB, Westpac, BNZ and Kiwibank focusing heavily on promoting special interest rate deals on three and five year fixed mortgages. Homeowners are likely to see very attractive rates because long term fixing is popular with banks as it gives them more certainty than a borrower with a floating rate mortgage.

Sam Shuttleworth, a partner of PWC said that, “I wouldn’t be surprised to see a lot of competition on three- to five-year mortgages when we come back from our lovely Kiwi holidays.”

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