Dunedin city residential rating values increased on average 38% in the three years since July 2019, according to the recently released 2022 Quotable Value valuations.

The new Dunedin city rating values were mailed to homeowners early February. Most owners will be aware of them by now. You can find them on the DCC website and other property websites such as One Roof and homes.co.nz.

The total rateable value for Dunedin district is now $47.7 billion. Of that $25.6 billion is land value. The average Dunedin home value is $672,000, with land values increasing 71.5% since July 2019 to an average of $363,000.

The figures reflect the big increase in market values in the past few years, driven largely by low interest rates, according to QV’s national revaluation manager Tim Gibson. But Gibson adds “that growth has fallen away throughout 2022 and 2023”.

So, following my last newsletter foreshadowing the rateable values release, let me again emphasise the distinction between rateable value and market value. They are not the same – and it can be fairly said that they seldom match. The latest round of values from QV have some noteworthy discrepancies. While appraising a Dunedin suburban property recently, I noted a nearby property had been marketed for the previous month around the low $700s and remained unsold. Its new rateable value is $900,000. At time of writing it remained unsold. This is by no means an exception. Generally, recent sale prices have been below the new rateable values. Any vendor who expects their 2022 rateable value to be a clear marker for their sale price is likely to be sorely disappointed.

The reasons for this have been outlined previously and include:

• Their assessment is based on sales that were in a different market and are no longer comparable
• QV rating valuations seldom require a visit to the property
• The QV assessment does not include chattels
• QV’s rateable values are for rating purposes only

Buyers have been quick learners in this regard and most recent property visitors I’ve encountered are aware that the 2022 QV values are mainly on the high side of today’s market.

As happens when markets fall, owners who have bought high and sell within a short time of ownership are facing a loss. The point most vendors should take comfort from is that those who have owned their property for a few years are still well ahead of the price they paid pre-2019.

Pricing to sell

Have you noticed there are more properties priced from the start of marketing? With the change in the market to buyers’ favour, “By Neg”, “Enquiries Over” or lack of any pricing guide is unattractive to those looking through the largest number of listings on the Dunedin market for some years. Current relaestate.co.nz listings are now around 700. In February 2021, Dunedin listings were at 266, and last February 538.  Median days to sell has now stretched from the low 20s to 60 days.

So, my strong advice to vendors focused on selling at the best price is price early and sharply. Otherwise, you risk staying unsold and going stale.