Noorbergen v VG
[2006] NSWLEC 555
•21/02/2006
Land and Environment Court
of New South Wales
CITATION: Noorbergen v VG [2006] NSWLEC 555 PARTIES: APPLICANT
RESPONDENT
Marcus Noorbergen
Valuer GeneralFILE NUMBER(S): 30890 of 2005 CORAM: Murrell C KEY ISSUES: Valuation of Land :- LEGISLATION CITED: Valuation of Land Act 1916 DATES OF HEARING: 21/02/2006 EX TEMPORE JUDGMENT DATE: 02/21/2006 LEGAL REPRESENTATIVES: APPLICANT
Mr M. Noonbergen, Litigant in personRESPONDENT
Ms A. Pearman, barrister
Crown Solicitors Office
JUDGMENT:
THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALESMurrell C
21 February 2006
JUDGMENT30890 of 2005 Marcus Noorbergen v Valuer General
1 This is an appeal under s 37 of the Valuation of Land Act 1916 in respect of the property known as No. 126 Lake Road, Balcolyn. The subject site is within close proximity, although not visible from the subject site, of the Lake Macquarie waterway. The subject property is within the Lake Macquarie Local Government area. It has a size of 9,537 sq m. The valuation base date is 1 July 2004 and at that time the Valuer-General ascribed a value of $430,000.
2 Evidence was given to the Court on behalf of the Valuer-General’s Department of Lands by Mr Kevin Bayliss, a registered valuer, with the company that does the valuations for the Lake Macquarie area for the Lands Department.
3 Mr Noorbergen is a litigant in person representing himself in these proceedings.
4 The Court had the opportunity of meeting on site with the parties this morning and carried out a site inspection of the subject site and the two comparable land sales provided by Mr Bayliss that are in many respects they are the most comparable in terms of their location. However, one must look at other sales in terms of the temporal difference that is, the date of those sales to the base date of the valuation being contested.
5 Mr Noorbergen, after hearing Mr Bayliss’ evidence in Court today, has provided a figure of the value of his property at $295,000. The Court has had regard to all the evidence to the Court.
6 On the way back from the subject site to the Court here in Kurri Kurri I had the opportunity of viewing the other two sales that were identified by Mr Bayliss that is, sales 3 and 4 in Ironbark Road, Morisset. The Court has also had the benefit of Mr Bayliss’ evidence to the Court and his written submission.
7 The applicant contends that the value of his property is less than that of $430,000 when one has regard to the adjoining property next door and the two sales in the street. Mr Bayliss provides an appropriate description of the subject property as being located on the south-eastern corner of Lake Road and Yarrawonga Park Road at Balcolyn. It is noted that there are some eight residential lots in Lake Road that are of a similar size, approximately 10,000 sq m or just under, and that Balcolyn is a residential suburb located in the Morisset Peninsula on the western side of Lake Macquarie. The township and railway station of Morisset are approximately 8 km distant and Bonnells Bay Shopping Village is 3 km. The other comparable sales in Ironbark Road are approximately half the distance to Morisset itself.
8 It is also noted that the subject site is zoned Residential 2.I under the Lake Macquarie Local Environmental Plan 2004. This plan provides a number of objectives for the planning regime of the subject site and also lists the uses that are permissible within the zone, that includes uses such as: bed and breakfast; dual occupancies; dwelling houses; general stores; home businesses; places of public worship; and educational establishments. The more relevant provisions in terms of the LEP are with respect to the minimum allotment size and subdivision. Clause 24 states:
- “Despite any other provision, subdivision of land other than that identified in sch 1 is exempt and may be carried out only with development consent.”
And cl 4:
- “Consent must not be granted for subdivision in zone 2.1, for the purpose of dual occupancy and attached dual occupancy unless consent has been granted for the erection of land and dwellings comprising that form of dual occupancy.”
9 If one turns to sch 2, this provides the subdivision standards. This is not a straightforward minimum allotment size. I will not cite the whole of the contents, but for the 2.1 residential:
- “Subdivision creating more than or equal to ten lots is to provide a minimum of 20% of all lots as standard lots and 10% of all lots for small lot housing. Alternatively, all lots may be used for small lot housing if each lot is not less than 1,000 sq m.”
10 There are other standards such as 450 square metres for dual occupancy, 600 square metres for small lot housing, and for attached dwellings there are a regime of minimum allotment sizes and standards.
11 The subject site is capable of subdivision, although Mr Bayliss’ is he has regarded it in terms of a single allotment. But then on the other hand in terms of the comparable sales when one looks at the comparable sales one must have regard to the potential of the land and this is an accepted principle in valuation. It is noted that this land together with the adjoining property or the property at 118, the vacant sale No. 1, and also 110 are all zoned the same as the subject lot. An astute buyer would have regard to the fact that the land can be subdivided, although Mr Bayliss has not valued it on the basis of the maximum number of lots that could be achieved.
12 It is noted that the applicant has said that sale 1 at No. 118 Lake Road was purchased by a developer, but there is no evidence to the Court that the site was not by a willing purchaser to a willing buyer in terms of the transaction and there is nothing peculiar that has been provided in terms of evidence as to why that sale should be disregarded. I do assume, and on the basis of the evidence, that it was a willing purchaser in the market and, whilst he may be a developer, nonetheless, it was a sale that I cannot disregard in these proceedings.
13 The Court must have regard to appropriate and accepted methodology of land valuations and this is the comparable land sales. Comparable land sales clearly are what guide the Court in terms of an appeal on a valuation. When valuation matters comes to appeal the valuation is put under greater scrutiny, as valuations are often global or a mass valuation as opposed to being individually valued. But at the end of the day the Court must look at the comparable land sales and in this regard, the comparable land sales are contained in Mr Bayliss’ report and he has provided four sales for this purpose.
14 Clearly the greatest yardstick or the greatest benchmark would be the sale of the particular land under appeal as of the base date. That very rarely occurs, so one must look at comparable sales in terms of not only the proximity in terms of location to the site but in terms of the proximity of the base date. In this regard, I consider Mr Bayliss has carried out an assessment which is fair in terms of providing the sales 1 and 2 both in Lake Road and then looking at as a check by sales 3 and 4, in particular sale 4, which is at the base date of the subject valuation.
15 The sale price of sale 4 at the base date valuation was $430,000, but that does not mean the assessment ends there because one must look then at what the zoning provisions are of that land. In that regard, Mr Bayliss has provided a factor of 30% as a variable, meaning that the subject site should have a higher value because it has potential for subdivision. When I say potential for subdivision, that does not require an approval as such. An approval would attach greater value to the property.
16 In terms of sale 1, which is 118 Lake Road, the sale date was March 2002 and an adjustment has been made in terms of what Mr Bayliss considered an appropriate percentage rise per annum between 2002 and 2004. His evidence is that the market did rise during this period, which is also consistent with general knowledge of the market rising, in particular in areas close to the coast or in coastal lake locations. His 14% per annum can be looked at in terms of the sale of property 3 and 4 in terms of proximity to each other, both in Ironbark Road, where there was a 14% rise within the one year for those two vacant parcels. Clearly vacant parcels also provide not so much a better guide but if there are vacant land sales, they should also be used because it does not require the same adjustments in terms of improvements.
17 The difficulty has arisen with sale 2 because it has a dwelling erected on it and has a deduced land value by Mr Bayliss of $330,000. The applicant contends that the value ascribed to or the capital improvement in terms of the dwelling house on that property has not been valued as highly as it should have been. Even if I consider valuing the improvements to a greater extent, that would not indicate a less value for the subject site because in terms of the other adjustments that Mr Bayliss has made, one could look at other adjustments in favour of the subject site, in particular the adjustment for topography. In this regard, it is noted that sales 1 and 2 are very close to the subject property and that is a desirable characteristic in terms of comparable sales. However, at the same time they are considered to be less desirable in terms of the affectation of the watercourse and the low-lying nature of these properties. The subject site has a slightly higher topography and it has the benefit of a watercourse if one wants to use for a single dwelling house. But in terms of future potential of the subject land, in the Court’s assessment it would require less expense in terms of subdivision and would be more attractive from this point of view. However, with the variations or the adjustments, one can scrutinise these and one can forensically try and look at them and that is probably not of great assistance. One must at the end of the day consider overall what the adjustments in terms of the total adjustments ascribed to those sales would indicate for the subject property.
18 Mr Noorbergen has indicated to the Court that he has personal circumstances where clearly it would be desirable for the subject land value to be less from his personal point of view. Whilst I understand his concerns and difficulties, at the same time in terms of valuation practice these are not matters which I can take into consideration. It is a matter that perhaps he needs to pursue by some other means in terms of a rebate or alleviation of the rates. The land rates in terms of council rates are based on the Valuer-General’s value of the land and this is a service that is provided to Local Government in order to then levy their rates. The other matters and personal circumstances are also not matters that this Court can take into consideration in its determination of the land value.
19 It is clear that the land does have subdivision potential and that is a matter that he may wish to pursue in terms of the joint ownership, whether that be a total subdivision or into two lots. But, as I said, that is a matter for the applicant himself. The practice of valuation does not and should not provide for individual circumstances in determining land values.
20 At the end of the day the Court must base its determination of the land value on the comparable sales and in this regard I concur with Mr Bayliss, I consider to be an assessment of land sales therefore, I do not consider it appropriate for the valuation which has been determined at $430,000 as of the base date of 1 July 2004 should be altered by the Court.
21 In the last 12 months, as in other parts of the State, there may have been a decrease in land values. That is not a matter that has been before this Court or relevant to its consideration because I am looking at the base date of 1 July 2004 and not how the market has performed post that date.
22 Similarly it is not relevant to have regard to The percentage rise on a subject property from one base date to another is not a relevant matter for the Court. It is to focus on the comparable land sales. There has been great focus from the respondent in terms of s 40(2) of the Act in that it provides for:
- “The appellant has the onus of proving the appellant’s case.”
23 A greater number of land sales within close proximity and close to the base date is always an advantage. This very rarely occurs, so one must then look at a logical assessment of what is provided. In this regard, the Court considers that Mr Bayliss’ assessment is robust.
24 The Court, in its determinations has made this comment on many occasions that is it usual recognise that the concept of land value cannot be scientifically and is not scientifically based. Individuals purchase property which at the end of the day is what the comparable land sale shows. Individuals purchasing properties do not look at matters in a scientific way. A prudent purchaser will look at the zoning, will look at the planning controls, and will look at other sales presumably within the area before making a decision to purchase a property. No two properties are exactly the same, as I noted earlier, and that is why allowances for various factors and variables must be taken into consideration.
25 At the end of the day, whilst one may say that the percentages in the tables could be altered in some way, even if one did alter those and allowed a greater factor for topography and a greater allowance for the dwelling house itself on 110, at the end of the day this does not change the fact that I am satisfied that the valuation of $430,000 should be upheld by the Court.
26 In summary, the practice of comparable land sales has been a long-established valuation practice and I must base my judgment and my determination on this methodology. This does not preclude an applicant coming to the Court with comparable land sales in an appeal with or without the benefit of a registered valuer. The Court may give due weight to a number of variables and if there has been a logical presentation of matters to the Court in terms of other factors that it should take into consideration by the applicant then the Court may do so.
27 Accordingly on the basis of the evidence to the Court and my assessment of the comparable land sales, the formal orders of the Court are:
1. The appeal in respect of the property known as 126 Lake Road, Balcolyn is dismissed.
2. The valuation of $430,000 as at the base date 1 July 2004 is confirmed.
3. The exhibits except 1 are returned to the parties.
___________________
- J S Murrell
Commissioner of the Court
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