Posted on Thursday, March 24th, 2022 in by Matt Garmony
The Licensed Valuers at Garmony Property Consultants undertake numerous Valuations for the objection of the assessed Unimproved Value which is the basis for Land Tax assessments in Western Australia. If, following our valuation investigation it is decided an objection is warranted, our Licensed Valuers can submit the prescribed objection form as your “Agent” and liaise with the Valuer Generals Office throughout the objection process.
Land Tax is an annual tax, based on a rate in the dollar of the Unimproved Value (UV) of the land, assessed by the Valuer Generals Office at Landgate. Under the Valuation of Land Act 1978, “Any person liable to pay any rate or tax assessed in respect of land who is dissatisfied with a valuation of such land made under this Act, may serve upon the Valuer-General a written objection to the valuation.”
The Valuation of Land Act 1978 defines Unimproved Value or UV as;
unimproved value means —
- in relation to any land situate within a townsite, except land referred to in paragraph (b)(ii), the site value;
site value of land means the capital amount that an estate of fee simple in the land might reasonably be expected to realize upon sale assuming that any improvements to the land, other than merged improvements, had not been made and, in the case of land that is reserved for a public purpose, assuming that the land may continue to be used for any purpose for which it is being used or could be used at the date of valuation;
Our licensed valuers have the extensive experience and expertise in assessing the appropriate Unimproved Value (UV) and preparation of a UV valuation objection.
CASE STUDY
The property comprised 3 development sites, with a total area of approximately 13 hectares located in a southern suburb of Perth. The properties were designated for high density (up to R80) residential and mixed use under the approved Local Structure Plan.
In 2018 the Valuer-General assessed 2 of the larger parcels of land to each have the Unimproved Value of approximately $2,000,000 and a smaller site of approximately $100,000 inclusive of GST.
We completed thorough research and investigations of relevant sales evidence and also completed hypothetical development analysis to demonstrate the properties were not viable development sites under the current Local Structure Plan. Given the location of the land, we argued it was not the current (as at the date of valuation) highest and best use and highly “aspirational” from a town planning perspective.
Based on our detailed analysis and basis for our objection, the result was the Valuer-General agreed to adopt reduced Unimproved Values of approximately $650,000 for the 2 larger parcels and $20,000 for the smaller site, as at 1 August 2018 date of valuation. It was also agreed to the same values for the subsequent years to now.
The outcome for our client was a successful reduction of Land Tax from approximately $60,000 per annum, down to approximately $3,000 per annum, with a substantial refund now due to our client in overpaid Land Tax since the original assessment 4 years ago.
This is also a prime example of where local authorities adopt very ambitious and “aspirational” town planning schemes, which incorporate high density residential zonings, in outer suburban areas that are not viable in the present market conditions. Careful review of unimproved values by our expert Licensed Valuers is important to make sure you don’t pay too much Land Tax.
If you have a property that falls into this category, please don’t hesitate to contact Garmony Property Consultants to discuss a review and valuation of the Unimproved Value and potentially an objection to the Valuer General’s assessment.