Allianz Home Insurance

 

What is the real property value?

by Chris Lang on October 10, 2007

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.

The Real Property Value calculator is based on the latest 2007 information of all the councils of Victoria. Use it to see what the real property value is – not the blown up market value, not the sky-high asking price – but the conservative estimate, carefully calculated by the council’s specialists. Select the council area property belongs to, enter the amount of general rates in the bill, click on “Calculate” and see what the real value of that property is.

Important! Do not enter the total of rates bill, which includes all the fees such as garbage collection, etc – use just the amount of general rates.

{ 7 comments… read them below or add one }

Ana September 19, 2010 at 12:05 pm

Hi there,
I bought a house for 550 and the council bill I just received said the capital value is 510. Does it mean I paid 40k more than the house is worth?

Thanks in advance
Ana

Reply

Chris September 21, 2010 at 6:27 pm

Hi Ana, council evaluations are done once about every 2 years. Depending on the date when this evaluation was done it could be outdated, and your house could have appreciated since it was last evaluated by the city council. Can you tell me what suburb did you buy in, and what state?

Reply

Stacey October 20, 2010 at 7:19 pm

Hi guys! I am about to try and get a little more added to my homeloan, and therefore will be requiring a valuation on my house, when i built it was valued at 160,000 by the bank, now 8months on i just received an amended rates letter saying my Capital improved value is 211,000. Can i expect my house to be valued at this by the banks valuer? Thanks.

Reply

Chris October 20, 2010 at 10:49 pm

Stacey, it’s really hard to guess. Council rates’ valuers may take into account the value of houses in the whole area where you live (they don’t necessarily go and value every single house). I hope you get your wish though 🙂

Reply

hedy August 13, 2012 at 12:04 pm

Chris the answer for Stonnington was no details

regards

Reply

sam October 15, 2012 at 1:09 am

Its really hard counsil rates are sometime lower than market price usually 10 percent. Since the market is slow counsil evaluation still going up which making no sense, my evaluation is far more than actual price of the property. They donot consider little things that matter when evaluating eg weatherboard house , old style house tends to be cheaper than modern house, they dont look inside even house falling apart theystill give capital improved value lot higher than site value.
Bank will send their own evaluation

Reply

Benji August 22, 2013 at 4:25 pm

Why does the CVI value of my property differ from the purchase price. I purchased the property before the valuation date have made no improvement and the CVI is 10% higher than purchase price.

Reply

Leave a Comment

Previous post:

Next post: