Each year your property is valued by the Valuer-General Victoria. This $ value is used to work out your rates and land tax.
Property values are worked out by analysing property sales and rents, and looking at the features of a property. Data about a property is collected from inspections, building and planning permits and other public sources.
We use the valuation given to your property in January 2021 to work out your rates for the year 1 July 2021 to 30 June 2022.
If your property has changed, an extra or supplementary valuation may be done. Examples of this include the construction, demolition or extension of a dwelling, or the subdivision of land.
Valuation amounts for your property
You will see 3 valuations on your rates and valuation notice:
- Site Value (SV) – the market value of the land (only). This is used by the State Revenue Office to calculate land tax.
- Capital Improved Value (CIV) – the market value of the land, plus buildings and other improvements.
- Net Annual Value (NAV) – prescribed or current value of the property’s net annual rent. This is the value used to calculate your rates.
Net Annual Value (NAV) explained
For residential properties, NAV is set at 5 per cent of the total value (CIV).
For commercial or industrial properties, the NAV figure is the higher value of either:
- 5 per cent of the total value (CIV), or
- the current value of a property's net annual rent (gross annual rental less all outgoings such as land tax, building insurance and maintenance costs etc. except Council rates).
How rates are calculated using property values
We follow 3 steps to calculate the annual general rates charge included on your rates and valuation notice:
Step 1: Work out rate revenue required and the value of all rateable properties in Port Phillip
First, we work out the amount of rates revenue required to support council services and infrastructure, within the rates cap. For 2021/22 we needed $135 million of rates revenue.
Next, we work out the value of all properties that pay rates in Port Phillip. The total value of all ‘rateable properties’ is $3,545 billion.
Step 2: Find the rate in the dollar
Then we work out the rate in the dollar (of the total value of rateable properties).
Revenue ÷ value of properties = rate in dollar
In 2021/2022 the rate in the dollar was: $135 million ÷ $3,545 billion = 0.038181
Step 3: Calculate your general rates
We don’t each pay the same rates. Instead, we pay an amount determined by the value of our property.
To work out your rates we multiply the rate in the dollar of 0.038181 x NAV for your property.
The impact of valuation changes on your rates in 2021/22
The amount of rates you pay each year is influenced by changes in the value of your property and the type of property you own.
While our overall general rates revenue increased by 1.5% in 2021/22 in line with the rates cap , the average rate change by property type was:
- detached houses – increase of 2.73%
- commercial and retail - decrease of 3.23%
- units – increase of 2.33%.
This was largely caused by an average decrease in the value of commercial and retail properties of 5.51%. This redistributed rates to detached houses and units which on average had limited changes in value.
Use the table below to get an indication of the impact of your valuation change between 2020 and 2021 on your corresponding rate change for 2021/22.
Effect of property market value on rates
|Change in property valuation from 2020 to 2021||Corresponding rate change for 1 July 2021 to 30 June 2022|
|Decrease of 30%||33.43% rate decrease|
|Decrease of 20%||18.07% rate decrease|
|Decrease of 10%||7.83% rate decrease|
|No change||2.41% rate increase|
|Increase of 10%||12.65% rate increase|
|Increase of 20%||22.89% rate increase|
|Increase of 30%||33.13% rate increase|
Objecting to a valuation
If you disagree with the value of your property, you may object within 2 months of the date of issue of the rates notice. Remember, your 2021/22 general rates are based on the value of your property on 1 January 2021.
You can lodge your objections on the Valuer-General Victoria Objection Portal.
For any general valuation queries, please contact us online or phone ASSIST on 03 9209 6777.
Municipal valuations are governed by the Valuation of Land Act 1960.
Contact the rates team
To talk to us about your rates send a direct message, or phone us on 03 9209 6777 during business hours Monday to Friday.