I am extremely new to this, so don’t laugh too hard!
I just received the Section 32 for a property we’ve been looking at, an apartment in Melbourne’s CBD, and there’s (1)Valuation & Rate Notice 2004-2005 and (2) Land Information Certificate included. I was hoping you may be able to help me interpret:
(1) Valuations (2004-2005)
NAV $14,000
Site Value $31,300
Capital Improved Value $280,000
Effective Date 1/07/2004
Valued as at Date 1/01/2004
Rate in $ 5.0 cents(2) City of Melbourne Land Information Certificate
Date of Issue 18/08/2003
Year Ending 30/06/2004
Operation date of Valuation 01 July 2002
Net Annual Value 13,500
Site Value 27,000
Capital Improved Value 270,000The asking price of the property is $300,000+
OK, here’s my questions:
What are these three values?
Would the total value of the property be all of these added together, or just the capital improved value?
Or is it just a value for the council for rates and has nothing to do with the real value of the property?Any help in deciphering this would be great!
Cheers,
JenJenD,
Site Value – market value of the land only
Capital Improved Value – total market value of the land plus buildings and other improvements
Net Annual Value – for residential dwellings, the NAV must be 5% of the CIV*market value is the valuations made by the council as provided by registered valuers
The rate in 5.0 cents, is the council determined figure to apply against valuations. ie valuation x rate in the dollar. Obvioulsy each council will set this as part of their budgetary process.
The valuation date was made on 1/1/2004 and effective on the rates in FY05 (1/7/2004 issued rates notice)
Land Information Certificate
The State Revenue Office uses site values for the purposes of assessing land tax. The council valuation used for 2004 and 2005, is that valuation which was used in 2002…The different valuation dates between the two notices ie 1/7/2002 and 1/1/2004 is the reason why Site Value & CIV are not the same.
The Valuer builds a profile of value levels for each different area / property type by analysis of recent sales and leasings. This information is then applied to individual properties, taking into account the different characteristics of each property
The above is an extract from my local council’s web-site, which applies a general property market approach and fits it to a specific property…So whilst there still shouldn’t be a huge difference, it is probably not a realistic guide to the current market value….Recent comparable sales of similar properties are better for you in ordre to judge what would be a fair and reasonable price for the property.
Trust this helps
Originally posted by woodsman:
not a realistic guide to the current market value….Recent comparable sales of similar properties are better for you in ordre to judge what would be a fair and reasonable price for the property.Well summarised Woodsman,[biggrin]
Council Valuations are used by councils to determine the annual council rates.
Land Information Certificates / Valuations are used by State Revenue Office to determine Lax Tax.
Although worth taking these valuations into account 99% of the time these figures are very conservatively calculated and are consequently way below the current market value of the property.
What you should be looking at in the Section 32 is the AMOUNT of actual costs associated with respect to ownership of the investment, that is look at HOW MUCH your council rates and your land tax bill will cost you each year.
Do not use these documents to try and justify the sale price for the property. This is best done, as Woodsman has suggested, by observation of similar properties either currently on the market, or that have just been sold.
Cheers,
Jo
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