Auckland homeowners may have rates rise as property values skyrocket

There's a serious call to change the way household rates are set across New Zealand.

Currently they're largely determined by the value of your property. But the Auckland Chamber of Commerce says the current system is "dumb" as a rise in rates doesn't get you any extra services from the council.

Currently how much you pay in is largely determined by your property's value, but the Auckland Chamber of Commerce says that system needs to be scrapped.

"Ratepayers across New Zealand need to be concerned about this because it's an unfair system," says Michael Barnett from Auckland Chamber of Commerce.

Mr Barnett's comments come as figures this week show Auckland property valuations have skyrocketed.

On average properties, have gone up 46 percent since 2014, while some south Auckland suburbs have increased by more than 150 percent.

"If your valuation has gone up 46 percent then it will - because that's the average - not affect your rates at all. If your valuation has gone up higher than 46 percent then you may get a rates increase because of that," says Debbie Acott, Auckland Council head of rates, valuations and data management.

Mr Barnett's biggest concern is those who face a rates increase won't get any extra benefits from the council.

"If the value of my property goes up I shouldn't have to pay anything more unless I'm going to get a better service or a better quality of service."

The council argues it's basically a property tax - a taxation on your wealth - and that it's law set by the Government.

"Anybody that's not going to convert their property into cash is in trouble, so if you're an elderly person, you're on a pension, you're on a fixed income; if you're a solo mother sitting down somewhere in the country, no more money, this is not going to help you," Mr Barnett says.

The council says it doesn't expect the rate increases to be "wild" and says if anyone is struggling to pay their rates, they do have options.

They include direct debits to spread out payments as well as the ability to postpone rates if you meet certain criteria.

On Monday Auckland Council will release the new values for individual properties, which will be able to be accessed on its website.


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