Written Answers - Property Valuations.

Tuesday, 17 November 2009

Dáil Eireann Debate
Vol. 694 No. 4

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  145.  Deputy Richard Bruton  Information on Richard Bruton  Zoom on Richard Bruton   asked the Minister for Finance  Information on Brian Joseph Lenihan  Zoom on Brian Joseph Lenihan   if the Valuations Office is undertaking fresh valuations in local authorities based on property values and business volumes at the height of the boom and revaluing the base for rate purposes in a way that is inappropriate for the present state of the market; and if he will make a statement on the fairness of this approach. [41320/09]

Minister for Finance (Deputy Brian Lenihan): Information on Brian Joseph Lenihan  Zoom on Brian Joseph Lenihan  The Valuation Act, 2001 which came into effect on 2nd May 2002 provides for the revaluation of all commercial and industrial property. The old valuation lists date from the Griffith Valuation carried out in the 19th century. Maintaining these lists requires the Valuation Office to determine valuations by reference to the values of comparable properties on the same valuation list. The result is a list of valuations that bear no resemblance to modern valuation levels and contains many anomalies. It has long been recognised that protecting the integrity of the local authority rating system nationally requires that this be addressed and the national revaluation programme is the means by which this is being done.

The basis of rateable valuation for all commercial property is net annual value (NAV) i.e. the rental value of the property. In a revaluation, properties are assessed, in accordance with statute, by reference to rental values at a specific valuation date and a new list of valuations is produced. This new list is then used by the rating authority to levy rates on individual ratepayers. By virtue of the statutory requirement that the valuation date precede the date on which a Valuation Order is made (initiating a revaluation in any given local authority area) and the work involved in actually carrying out a revaluation of several thousand properties [895]before the final valuation list is published, there will be a significant interval between the valuation date and the date of publication of a new list.

Revaluation is essentially about the redistribution of the commercial rates burden between ratepayers depending on the relative shift in the rental values of the properties they occupy. It is the relative value of properties to each other rather than the absolute value of an individual property, which will determine whether the rates liability of any given property decreases or increases following a revaluation. The purpose of revaluation is to bring more equity, fairness and transparency into the local authority rating system and following completion of the initial national revaluation programme. This should result in a much closer and uniform relationship between rental values of property and their commercial rates liability and this relationship will thereafter be maintained by means of the recurring revaluations provided for in the Act. In essence, the exercise is aimed at ensuring a fair sharing of the rates burden across all categories of ratepayers.

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