Every 2 - 3 years every council evaluates all the properties in its area. There are 3 ways of valuating a property: using Site Value, Capital Improved Value or Net Annual Value.
Site Value means just land value; Capital Improved Value means value of both the house and the land. Net Annual Value is a bit different – it means how much the annual rent would be if the property was leased (less the landlord’s expenses). Usually for residential properties it is calculated as 5 % of Capital Improved Value.
There are 79 councils in Victoria and they use different methods of valuation. Sounds too complicated, right? Wrong! There is an easy way to get the real value of the property (as recorded in council’s books) using council rates that the owner pays.
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