The Winners And Losers Of Nelson’s Revaluations

Thursday, 24 April 2025, 7:31 pm
Article: Max Frethey - Local Democracy Reporter

Nelson’s properties have all been revalued and residential land value across the city dropped 16.08% on average, but where did values fall the most?

Properties are revalued every three years to help councils set rates for the following three years.

The most recent revaluation in Nelson is a snapshot of the market in September 2024.

The last valuation was taken in 2021 during a “property boom”, and the average 16.08% drop in residential land value reflects the downturn seen since.

“It is normal for a market to see some sort of correction in prices after such a strong lead-up,” said Quotable Value (QV)’s manager for Nelson/Marlborough, Craig Russell.

“Interest rates as at September 2024 were at historically typical levels, but with housing supply at very high levels, which provides buyers with plenty of choice, and no feeling of urgency to buy – this results in falling values, especially when sellers are keen to move on.”

Nelson bases its rates off land value, but even though residential land value fell by 16.08%, that doesn’t mean your rates bill will also fall.

The city’s rates will increase next financial year by an average of 6.5%.

If your property’s land value has dropped the average of 16.08%, correspondingly your rates will be increasing by about the average 6.5%.

But if your property has dropped in value by less than 16% or has gone up, you will have a larger rate increase.

About 900 properties will have a rates increase of more than 10%.

Properties in the Atawhai area have seen the greatest drop in their land value, plummeting by 21.01%.

Close behind was the Nelson College/Nelson East area dropping 19.03%, Tāhunanui and the Port Hills falling 18.21%, and the Central City/Wood area decreasing 18.11%.

Russell said the August 2022 storm exacerbated the softening market across these areas.

“We have seen the market discount properties in these locations regardless of whether the property has been directly impacted or not due to a reduction in purchasers' risk tolerances,” he said.

“Generally speaking, the greatest land value discounts were hill locations which experienced land instability as a result of the weather event.”

The Tāhunanui Slump area received the most notable drop in land value since 2021, plummeting between 30 and 50%, with some falling even further.

The Nile Street/Cleveland Terrace area, also badly affected in the 2022 storm, saw land values fall by about a quarter.

Atawhai’s steep drop, however, was also influenced by an oversupply of sections and increasing costs of developing property on sloping land.

“In some instances, we are seeing the cost of new homes exceed their value.”

Areas less impacted by the 2022 storm saw smaller decreases more in-line with the average decrease across the city.

The Washington Valley/Abraham Heights area saw residential land value drop 14.73%, the Wakatu/Annesbrook area fell 14.43%, and Stoke declined by 14.22%.

Nelson South, which typically comprises entry level properties, saw some renewed interest from first home buyers which saw land values fall below the city average at 11.38%.

But Nelson’s more rural areas, those residential properties most removed from the core urban areas and nearer the hills that surround the district, saw the smallest drop in land value, falling by just 8.23%.

While land value fell across the city for residential properties, industrial land surged by 22%, while commercial land climbed by 6.8%.

“Broadly speaking, industrial property remains the investment of choice and demand is still strong although interest rates have emphasised the importance of a good lease and yield,” Russell said.

Nelson property owners will soon receive a notice of their rating valuation in the post or via email with their updated property rating value.

If you believe your new valuation does not fairly represent the value of your property as at 1 September 2024, you have the right to lodge an objection before 2 May 2025.

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