Background  

Land in NSW is subject to regular valuation by the Valuer General, who provides updated notices to landowners every three years on average. Most land is valued using a “mass valuation” technique based on recent sales in the local area. Note that only the land is valued – the valuation does not include buildings or other improvements.

Given this “mass” approach is not specific to any particular property, valuations can be open to question. This is especially the case where the Valuer General relies on a process to separate the value of the underlying land from any fixtures, or where land has particular features that will impact on its value. Even the Valuer General accepts that, in some circumstances, the valuation technique may lead to an overstated valuation. It is difficult for the Valuer General’s office to consider all relevant factors in determining values for each individual land holding.

As a result, the Valuation of Land Act 1916 (NSW) allows Landowners to request a review of the valuation adopted. Given significant movements in the property market during recent times, it is important to check the Valuer General’s land value for your property reflects reality and that you are not paying more land tax than you should be.

Why might you consider requesting a review?

The valuation is provided to local Councils and used as a reference in determining rates, and also to the Office of State Revenue for calculation of Land Tax. The valuation may also be referred to for taxation matters: for example, if land is transferred between related parties, the capital gain and / or Stamp Duty may be calculated with reference to the Valuer General’s valuation. An overstated valuation may therefore lead to payment of excessive Council Rates, Land Tax, Income Tax and/or Stamp Duty.

Conversely, note that an understated valuation if reviewed could be increased and therefore could increase your liability. Therefore you would only consider a challenge if you are reasonably confident that the supplied valuation is overstated.

What is the process for review?

1. Generally, the timeframe to request a review is 60 days from the issue of an updated notice of valuation. However, the Valuer General is prepared to accept late requests in special circumstances.

2. You can request a copy of the data that has been used by the Valuer General in arriving at the valuation.

3. Gathering the relevant information to support the objection – for example, data regarding additional local sales or photographs to demonstrate characteristics of the land that would result in a reduced valuation.

4. Completing the “Valuation Objection Form” - either online or by mailing a paper version.

5. The Valuer General checks the form for completeness and then will issue a letter acknowledging receipt.

6. A professional valuer will review the landowner’s concerns, and may inspect the land in question.

7. The Valuer General will make a decision and notify the landowner in writing.

8. The Valuer General will notify the local Council and the NSW Office of State Revenue of the updated valuation. Those organisations will then make any required adjustments to rates and taxes previously levied.

What reasons are valid for requesting a review?

The Valuer General has outlined examples of supporting information that will be an acceptable basis for lodging an objection. They include:

• Reference to specific comparable sales in the area.
• Specific features of the land (e.g. views, location, soil type etc).

What reasons are seen to be invalid when requesting a review?

Invalid supporting information includes:

• Comparisons to other land valuations.
• Reference to asking prices.
• Reference to previous land values or the growth rate of the valuation.
• Median or average land values in the local area.
• Personal circumstances.

Where can I get further information?

You can find further information at www.lpma.nsw.gov.au/valuation/land_value_review or by contacting your Lawler Parters Client Relationship Manager to assist you with your objection.