Quake hits area's home values
Kaikoura property values are declining more than neighbouring districts, but the town is far from being a cheap, low-value area.
That is the message from Quotable Value southern operations manager Brendon Bodger, who presented a fairly bleak picture to the Kaikoura District Council last week.
Mr Bodger said Kaikoura had been well above the national average in terms of residential property values until the global financial crisis hit, and now it was falling well below the average.
Kaikoura values had been affected by a decline in tourist numbers and the fallout from the Christchurch earthquakes.
Kaikoura had been a playground for Christchurch, but with people there feeling the squeeze they had been letting go of the holiday homes, he said, which had also affected Kaikoura property values.
Total capital value had dropped since the last two revaluation years, from $1560 million in 2006, to $1451m in 2009 and $1499m this year.
Though values of churches and schools were up 4 per cent, residential values were down by the same amount.
The capital value for an average house in Kaikoura is now $348,500, and the new land value is $175,000.
Mr Bodger said there had also been a slight decrease in rents because of the increase in vacant properties compared with previous rating years.
Dairying was doing well in Kaikoura, though decreases were being seen in all other sectors.
A comparison with other districts showed things were a "wee bit tougher" in Kaikoura.
Other areas, particularly outside Christchurch, were seeing increases in values, he said.
One of the reasons for this was that these other areas became good markets after the earthquakes because of closeness to the city.
Council chief executive officer Stuart Grant said one positive to be taken from the new rating values was that housing was becoming more affordable in Kaikoura.
Mr Bodger also conceded that values in Kaikoura had historically been overrated and that perhaps the new ratings were a more realistic reflection of the market.
Council building inspector Dave Laughton told the council last week that October had been a quiet month for building consents.
Just five were issued, making it the poorest month for many years.
Mayor Winston Gray said it was unlikely there would be any decrease in rates as a result of the declining property values.
Though it was hard for the layman to understand ratings systems, it could not be automatically assumed that rates would go up or down with property values, he said.
Mr Grant said the council still needed a certain income to operate and even if the distribution was altered the council would still collect the amount of money it required through rates.