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In Auckland’s property market, Capital Values (CVs) have been used as a quick reference for a property’s worth but are becoming increasingly less reliable when being used as a guide for buyers and sellers alike.
As real estate agents in Auckland, we see the gap between CVs and sale prices and these differences can vary by hundreds of thousands of dollars.
We are seeing properties sell for 20 to 30 per cent above CV in some suburbs and well below in others. Buyers who treat the CV like a benchmark are often misled.
One key issue is in the lag in CV updates. The most recent CVs released in the last few weeks were completed on May 1, 2024, but are only being only released now.
Moreover, CVs do not consider any unique property features or recent renovations. A home that has undergone a $200,000 upgrade will still carry the same CV as its unrenovated neighbour. Similarly, location nuances – such as school zones, sun aspect, or off-street parking are often overlooked in a blanket assessment.”
Overreliance on CVs can skew both buyer expectations and seller pricing strategies.
We’ve had open homes where the buyers walked away because they thought the property was overpriced based on CV, even though comparable sales clearly supported the asking price.
In an environment where market conditions shift rapidly, Christina urges the public to view CVs as a council tool for rating, not a proxy for current market value. Instead, she encourages buyers and sellers to consult recent comparable sales by talking to real estate agents, and to obtain independent valuations when making real estate decisions.
Property owners wishing to object to their valuations can do so via the Auckland Council website. Visit www.aucklandcouncil.govt.nz Search “Object to our valuation of a property”
by Real Estate agent, Christina Tubman
