Letter to: Ms Julie Walton, Chairperson, Valuation of Land Inquiry
Dear Julie,
Thank you for the opportunity to place some brief comments before your Inquiry, and including comments (26-3-99) to Legislative Council Standing Committee re Land Tax.
My comments are directed to the impact upon Residential Land used as Rental Housing and Premium Property. The principles and practices the current Valuation Methodology applies are well established, although Land Valuation is not an exact science as opinions to qualify and quantify, market sensitivity between different zoning – location and physical features etc becomes educated guesswork.
The Valuation of Lands Act 1916 requires the Valuer General to value on mass each parcel of land reflecting its Highest Economic Use with the sale price of Vacant Land, often referred to as knockdown. In established urban area (Example SEPP10), Vacant Land sales are rare, and supply and demand are distorted as all parcels are valued as though each will be offered in isolation for sale on a market where such Vacant Sales are rare and demand high.
The Valuation Methodology used to impose Land Tax upon Rental Housing and Premium Property, particularly conventional housing in established suburbs, exploits unmercifully supply and demand factors to maximise Tax on Rental Housing and Premium Property.
C.J. [Mike] Danzey
August 1999