Sydney's Auburn leads growth in land values across NSW: Valuer General
Auburn had the biggest metropolitian increase in land values - soaring by 16.1 per cent - as the latest issuance of land valuations took land across NSW to a record $1 trillion.
The NSW Valuer-General had residential land values for NSW up by 3.21 per cent, compared with an overall 0.24 per cent decrease for the previous year.
Sydney's inner west and middle ring western suburbs continued to notch up the biggest metropolitian increases.
Auburn's 16.1 per cent rise was followed by Ryde up 9.6 per cent, then Marrickville up 9.5 per cent, Ashfield up 9.2 per cent and Parramatta up 8.8 per cent.
Investors have been eyeing off Auburn, with Property Observer noting one pre-Christmas sale reflecting a 9% gross yield. According to the latest RP Data report, the median unit price in Auburn is around $360,000, up 12% on last year. One unit is not going to put the landlord above the land tax threshold, but if it was among a portfolio, the investor could be paying land tax for the first time given the hefty rise.
The family home is not taxed or included in any combined total of a property portfolio.
The land tax threshold sits at $412,000 in the 2014 land tax year, up from the $406,000 threshold last tax year. It means despite the small 3.21% percentage rise more second home owners will fall into the tax net given there was only a 1.4% bracket creep shift in the threshold.
New valuations have been issued on annual and tri-annual determinations based on a rotating system through the state's local government districts.
Some 26,020 notices of valuation were issued to landholders in the Ryde local government area (LGA) having last occurred as at 1 July 2010.
The new total land value of the Ryde LGA was $21.29 billion as at 1 July 2013, an overall 11 increase from the total land value of approximately $19.12 billion determined as at 1 July 2010. The report found residential properties generally experienced a moderate increase in land value with the exception of some areas around Ryde and North Ryde which experienced slight increases and properties in Denistone which generally experienced strong increases.
Some 53,014 fresh notices of valuation have been issued to landholders in the Bankstown local government area with the total land value at $25.02 billion, an overall 15% increase over the three years from 1 July 2010.
“The increase in the Bankstown LGA was primarily due to an increase in residential land values as a result of higher demand than supply, contributed to by lower interest rates," the Valuer General said.
Holroyd's 27,591 new valuations jumped 11% over the tree year period to $11.06 billion as at 1 July 2013.
The land valuations will be used by the NSW Office of Revenue to calculate the land tax property investors will pay this year.
The tri-annual land valuations are used by councils to calculate their fresh rates.
“Changes in land values don’t necessarily lead to similar changes in rates," the NSW Valuer-General Philip Western said.
He further suggested increases in most land tax assessments may be modest with the prior two flat valuation years being taken into account in the calculation. For 2007 and subsequent tax years, the value used to determine land tax liability is the average of the land value for the current tax year and the land values for the previous two years.
But Mr Western acknowledged the increase was a sign of the recovering market, in his reponse to queries from Sydney's weekend papers.
Prestige suburbs were however subdued in their land valuation growth. The premium land tax threshold at $2,519,000. Land values in woollahra municipality fell another 3.1 per cent to a median of $1.23 million. woollahra median land values are down from the 2007-2008 high of $1.47 million. The Manly market was also soft.
The Mosman local government area had the state's highest median residential land value at $1.3 million with the Central Darling credited as the lowest at $1200.
The biggest increase in rural values occurred in Bourke (19.3 per cent), Brewarrina (11.6 per cent) and Murrumbidgee (10.2 per cent).
Tenterfield experienced the largest decrease in overall values for the 12-month period with total land value decreasing by 10.02 per cent. The Great Lakes local government area experienced an 8.6 per cent drop to $148,000.
The biggest increases in coastal land value were in Kiama (5.2 per cent), Yass Valley (5.1 per cent), Newcastle (2.7 per cent) and Wyong (2.6 per cent).
The value of 2.4 million properties around the state exceeded a record $1.003 trillion.
“This is the first time that the state’s total land values for rating and taxing has exceeded a trillion dollars,” Mr Western said.
Every year approximately one third of Local Government Areas (LGA) receive new valuations to assist with their rates modelling. Some 774,000 notices of valuations will be sent to ratepayers in 57 LGAs this month, showing the value of properties based on market conditions as at 1 July 2013.
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