What is Capital Value (CV) and Why Does it Matter?
If you’re a homeowner, you may have been waiting on tenterhooks to hear what your property’s CV is. This rating, known as the Capital Value (CV) or the Rateable Value (RV), is determined by your Council at least every three years, and is used to work out how much you should be paying in rates.
The QLDC has recently updated local CV/RV’s and property owners throughout the district have seen some hefty increases in value.
If you haven’t received an updated CV or are curious about one for another property, head to the council website to find out. There, you can search for an address to find out it's land value and the value of any improvements.
While the CV rating of a property can be useful to know, it is also contentious. It’s believed to be an inaccurate reflection of the true market value, however this is not usually the case especially in fast moving markets like we have here. To understand how a CV is determined, you need to know how they are calculated.
While a more accurate appraisal of a property would require an individual visit by a valuer to each residence, resources don’t allow for this. So think of the CV as more of a snapshot of the property rather than a thorough assessment. Mass appraisal techniques are relied on, such as what type of property it is (a house or apartment, etc.), how much properties in the vicinity are going for in the market, and any changes that have been since the last valuation (such as renovations).
If a CV rating has now changed, the owner could be up for an increase or decrease in rates. If the property increases by more than the average increase, expect to pay more. But again, it’s not that clear-cut. While the CV plays an important factor in whether the rates bill will cost more, it only contributes to a third of the cost (the rest of which is made up of fixed costs). And although the CV will be of interest to potential buyers of your property, it doesn’t hold that much weight, as it reflects a past evaluation rather than a future prediction.
Homeowners do have the power to object to their CV, but only on the grounds of the valuation being incorrect in their view, rather than them being annoyed at a potential rate hike. Here the last day for objections to be filed was the 10th of November so unfortunately if you are reading this now and having doubts about your own, you are too late.