The Rateable Value of a house (or RV) is often quoted in the advertising for a house for sale - the suggestion is that it provides some kind of indication of the market value of the house - but does it?
What is the RV?
The RV is the rateable value or the 'value' of a house set by the local authority for the purpose of determining and allocating rates. The RV is also sometimes known as the government valuation (GV) or capital value (CV).
Why is the Rateable Value Quoted in House Adverts
Real estate agents often mention the RV in advertising, most often this is because people like to know the rateable value! But sometimes it is because the real estate agent or home owner feels that the RV is a good indication of the market value of the house. The RV's relationship to the market value of the house is ultimately up to you to decide, here are some things to consider:
Rateable Value v Price
The rateable value doesn't usually take into account anything that makes a property better or worse than others in the area, for example condition of the house and land, chattels included, landscaping improvements, and so on. Sometimes the RV is a good rough-guide of value but other times it is completely irrelevant.
An RV can be very out of date! RV's are done at least every 3 years - this can be a long time in the property market. Check the date of the rateable value - it may be 2+ years old - and not relevant in the current market.
Should I Use The RV as a Price Guide?
As a rule, you should only use the rateable value in combination with other information, like your own experience or a registered property valuation. If you are looking for the rateable value of a house - you can find out rateable value information on your local council's website for free.
Property Valuation and Rateable Values
One last thing! A registered property valuation done by a registered valuer is not a rateable value or a RV, and a registered valuation should not be referred to as an RV. To find a registered valuer - visit Property Valuation NZ.
The Propertytoolbox Home Buyers Guide
This information about the RV as a price guide was from the resources section of Property Valuation NZ – the home of the property valuer profile – making it easy for you to make a good decision when choosing a local property valuer.