Projected drop in Brisbane's CBD commercial land values

Tuesday, 09 March 2010 17:25

A projected drop in Brisbane's CBD commercial land values by an average of 16 per cent discredits claims that amendments to Queensland's valuations laws will increase values.

Minister for Natural Resources, Mines and Energy and Minister for Trade Stephen Robertson today released the report, Property market movement for the 2010 valuation, which provides a snapshot of the predicted market movement for commercial, industrial, rural and residential land for the 23 local government areas being revalued this year.

"Commercial values on the Gold Coast are showing an overall 16 per cent reduction, while Brisbane is showing a 6.6 per cent reduction, with the largest decreases, of an average of 16 per cent, in the CBD," Mr Robertson said.

He said the report put to rest incorrect claims about the impact of the government's proposed amendments to the Valuation of Land Act.

"After all the alarm created in recent weeks, this report indicates that commercial and industrial property values in Brisbane and the Gold Coast would actually fall in line with market movements using the very legislation this bill will protect.

"When the current legislation is passed, valuations will be issued on exactly the same basis they always have been."

"Claims that the 2010 valuation would see 'biggest ever change to land taxation' were clearly incorrect."

"There is no 400% increase in property values evident here and valuations are reflecting simply market movements - not a new valuation methodology,"

Mr Robertson said if the legislation was not passed, it would be a different story - with further reductions for commercial and industrial owners of 20 to 35% in addition to the changes currently being forecast.

"Without this legislation, the recent Court decision would have provided a $1 billion windfall in repaid land tax and rates to big commercial property owners at the expense of average ratepayers."

"This report shows that land values for the top ten most valuable properties in Brisbane's central business district have actually dropped by 16 per cent in value since their 2007 valuations - reducing their collective value by some $193 million," Mr Robertson said.

"We're expecting to see a 15 to 23 per cent decrease in the value of theme parks, since their last valuation in 2007 consistent with the overall commercial trend on the Gold Coast.

Mr Robertson said not every Local Government area being revalued would see a fall in it property values.

"The report highlights that the 2005 to 2008 property boom in Queensland resulted in large increases in both the volume of sales and sales prices, in all market sectors."

"The boom period will be reflected in some Local Government Area revaluations, as some local government areas had not been revalued since 2004.

"In the more regularly valued areas - mostly Brisbane and the Gold Coast - reductions in value are common due to the economic downturn. In fact, Gold Coast values have fallen across all sectors," he said.

Mr Robertson said that the market snapshot demonstrated that any change in valuations, after the passage of the current legislation, would still be determined by market movements, not a change in methodology.

He said that despite a flattening of the market overall, residential values had shown a continuing upward trend particularly in lower-priced properties, a sector boosted by first home-buyers.

The Report indicates residential land values in Brisbane show an overall increase on average of 11 per cent since 2007, which is modest compared with average annual increases between 2005 and 2007. Gold Coast residential land decreased on average in value by 5 per cent over the same period.

"In general, regional residential markets have been more resilient to the impacts of the global financial crisis and latest indications are that the market has stabilised with sales volume and market values increasing marginally," Mr Robertson said.

The report is available on the Department of Environment and Resource Management website at www.derm.qld.gov.au .