Ryan v Department of Natural Resources, Mines and Energy
[2004] QLC 85
•28 September 2004
LAND COURT OF QUEENSLAND
CITATION: Ryan v Department of Natural Resources, Mines and Energy [2004] QLC 0085 PARTIES: Patrick John and Elizabeth Jean Ryan
(applicants)v. Chief Executive, Department of Natural Resources, Mines and Energy
(respondent)FILE NOS:
AV2003/0676
DIVISION: Land Court of Queensland PROCEEDING: Appeal against annual valuation under the Valuation of Land Act 1944 DELIVERED ON: 28 September 2004 DELIVERED AT: Brisbane HEARD AT: Brisbane MEMBER Dr NG Divett ORDER: The appeal is dismissed, and the unimproved value of Lot 25 on RP 51273 as determined by the Chief Executive in the sum of Three Hundred and Fifteen Thousand Dollars ($315,000) is affirmed. CATCHWORDS: Valuation – Sales – Sales analysis – Method of analysis – Loss of city views – Risk allowance applied APPEARANCES: Mr Ryan for the appellants
Mr Smith for the respondent
Background:
This matter deals with land at 4 Sylvan Avenue, Nundah, and described as Lot 25 on RP 51273, Parish of Kedron. The subject land has an area of 637 square metres, and is located about 7.7 kilometres radially north-east of the Brisbane GPO, in a residential area near the border of Nundah and Wavell Heights. Access is good to Sylvan Avenue, which is bitumen sealed with concrete kerbing and channelling. All normal urban utility services are available, and the subject land is designated Low Density Residential Area under the Brisbane City Plan 2000, effective at the date of valuation of 1 October 2002. The key issues are the nature of the land, impact of City views, relativity and comparison of sales.
On 24 February 2003 the Chief Executive issued a valuation of the subject land at $330,000. Following an objection from the owners, the Chief Executive revised that unimproved value to $315,000 on 5 August 2003. The appellants have now appealed, claiming the unimproved value should more properly be $250,000.
Patrick John Ryan, who is an experienced property owner and developer, appeared and gave evidence on behalf of the owners. Mr GJ Smith, Senior Legal Officer, appeared for the respondent, calling evidence from Andrew Trevor Brown, the departmental registered valuer responsible for determining the valuation.
Nature of the Land –
The subject land is well located about 1.5 kilometres from the Nundah Railway Station and about 1.7 kilometres from the Toombul Railway Station. Bus transport is only 200 metres away, and the subject land is conveniently located from the Nundah Village and Toombul Shopping Centres (2 to 3 minutes driving) and also Chermside Shopping Centre (5 minutes driving). Both primary and secondary schools are within walking distance, as is also recreation facilities at Kedron Brook and Kalinga Park.
The subject land is a near rectangular parcel falling gently from Sylvan Avenue towards the rear. The land is elevated, and at the date of elevation had City views towards the rear across existing residential properties. However since the date of valuation there has occurred subsequent redevelopment which, as explained later, was likely to adversely impact the City views from the subject land.
Mr Ryan argues that the future loss of City views has been accepted by Mr Brown as having an impact upon the unimproved value of the subject land. He notes that was accepted by Mr Brown following the objection by the appellants, which then resulted in a reduction of $15,000 in the value for that purpose. Mr Brown is very familiar with that location, having resided close by for the last three years. However Mr Ryan argues that such loss of views would result in a more significant reduction in value of the subject land, than the amount now offered by the Chief Executive.
To support that assumption Mr Ryan provides a copy of a newspaper article, and personal advice from a private valuation company, which he argues indicates that the loss of a City view could decrease the value for a property by at least $100,000. However Mr Ryan provides no specific details of those assertions, and such opinions provide very second hand hearsay evidence about the likely impact upon the subject lands. It is noted that the articles expressed pictorially in the newspaper, reflect significantly different panoramas of views compared to those at the subject land.
Mr Ryan further advises that the property at 259 Buckland Road, immediately adjoining the subject land to the rear, was sold for redevelopment purposes prior to the date of valuation. He advises that parcel, which was previously a smaller parcel and a larger parcel, after the old dwelling was demolished in early 2004, was then reconfigured by subdivision into two equal 466 square metre parcels. Mr Ryan has spoken directly to the purchasers, who advised him that the purpose of the original purchase of 259 Buckland Road was to provide two home sites for new residences for the two purchasers. Mr Ryan now provides recent photographs to demonstrate that following the subdivision, there are now in progress two-storey dwellings under construction on both sites. Mr Ryan argues that at the time of valuation in October 2002 it would have been obvious to any potential prudent purchaser of the subject land that any proposed new buildings, probably to a maximum height of 8.5 metres, would have obstructed City views from the subject land.
However Mr Ryan concedes that in view of the residential nature of the surrounding areas, and the general slopes of the land, there was always some element of risk that City views could be impacted by redevelopment works. Mr Brown advises that such redevelopments are fairly common in that locality, where property values have increased by 76% during 2001 to 2002. Mr Brown accepts that situation, and advises that he had provided that $15,000 in recognition of that element of risk, and the level of potential it had reached at October 2002. However Mr Brown advises further that at a subsequent revaluation, once it became clear about the actual final impact of the redevelopment upon the City views, then a larger allowance may well be appropriate. He advises that was likely to be considered at the next revaluation at 1 October 2004, as there had been no valuation in 2003.
In respect of any total loss of City views at the subject land, Mr Brown declines to provide an estimate of any value loss, as he notes that views are just part of the attributes of any site value of the land. However he concedes that views, in particular City centre views, are highly prized in the market place. However Mr Brown notes that at the date of valuation, the subject land still retained views of the City centre. Mr Brown adds further that the locality of the subject land in Nundah is similar to the positive attributes much sought after in adjoining Wavell Heights.
Relativity –
Mr Brown advises that in applying unimproved values on surrounding parcels near the subject land, he has maintained the long established relationship between parcels which has been developed over many years, and has remained constant over the last five years. However he notes that while Buckland Road was previously seen as a busy traffic thoroughfare, and the values in that street were applied accepting that situation, with changes in traffic flows along Buckland Road declining following the construction of the tunnel around Nundah Shopping Centre, that may need revision in the future.
Comparison of Sales –
Mr Ryan notes Mr Brown’s sales comparisons, and provides the following sales:
· Sale 1 – (20 Sylvan Avenue – Lot 17 on RP 51273). This is a 728 square metre parcel about 120 metres west of the subject land. The sale sold on 16 January 2003 for $350,000. Mr Ryan estimates the value of the similar cavity brick house as on the subject land at between $130,000 to $150,000, and therefore the value of the land at between $200,000 to $220,000. He notes that sale has potential City views equal or superior to the subject land.
· Sale 2 – (Aland Street, Wavell Heights) Mr Ryan notes that vacant lands in Aland Street were adopted previously in another valuation matter in this locality in the matter of (TP and MC Melit v Department of Natural Resources and Mines, AV2003/0561, 2 April 2004, unreported). Mr Ryan provides no details of those sales, but refers to that previous record of sales of vacant lands which he argues provides a useful check upon Mr Brown’s comparisons. Mr Brown advises that he has considered the Aland Street sales in his overall analysis of the 20 sales in the locality, but feels that the four sales he has now selected are a more appropriate comparison to the subject land. The sale at 36 Aland Street sold in June 2002 for $235,000.
· Sale 3 – (29 Imbros Street, Nundah – Lot 29 on RP 58718). This was a sale adopted by Mr Brown for a previous appeal of Melit at 1 October 2001 (AV2002/0169), delivered on 6 February 2003. The sale has an area of 609 square metres and sold in February 2001 for $177,000. Mr Ryan provides no details of those sales, but again argues they provide a better appreciation of the market value for vacant lands in the area.
· Sale 4 – (227 Buckland Road, Nundah – Lot 54 on RP 53333). This has an area of 637 square metres, and was valued by registered valuers on 25 November 2002 for mortgage purposes at $235,000, including land ($150,000) and improvements ($85,000). Mr Ryan provides a copy of the valuer’s report, however there was no opportunity to examine the valuer to determine the basis of that report. The existing dwelling was seen as similar to that presently occupying the subject land. Without further clarification that valuer’s report provides little assistance in this matter.
Mr Ryan also notes other sales of vacant lands at 55 Caruso Street, Nundah (598 square metres sold in December 2001 for $195,000); 66 Hanson Terrace, Nundah (sold May 2001 for $134,000); and 3 Hedley Avenue, Nundah (403 square metres sold in April 2002 for $139,000). However he provides photographs and no direct comparisons of those parcels, and I get little assistance from those sales.
To support his valuation Mr Brown provides the following sales:
· Sale 1 – (48 Brae Street, Wavell Heights – Lot 23 on RP 43855). This is a 426 square metre vacant inside parcel located about 1.1 kilometres west of the subject land. The sale is further from road transport, and is seen in an inferior location, with inferior access due to vehicle parking associated with the high school and preschool nearby. The sale is smaller, with inferior City views and is seen overall as inferior to the subject land. The sale sold in September 2002 for $255,000, was analysed at $250,000, and applied at $247,500.
· Sale 2 – (21 Brae Street, Wavell Heights – Lot 11 on SP 152978). This is a 512 square metre vacant parcel located about 0.9 kilometres west of the subject land. The sale is also further from rail transport but adjoins a bus stop. The sale is smaller in size and has no City views, and is seen to have slightly inferior access due to “rat-runner” peak hour traffic in Brae Street. However Mr Brown concedes that Sylvan Avenue also suffers from a similar “rat-running” traffic seeking to avoid traffic lights at Shaw Road and Buckland Road intersection. The sale is irregular in shape, gently sloping towards the rear, and with some outlook but no City views. The sale is seen as far inferior to the subject land. The sale sold in September 2002 for $217,500, was analysed at $212,500, and applied at $192,500.
· Sale 3 – (37 Westwood Street, Nundah – Lot 11 on SP 151552). This is a 512 square metre vacant parcel located about 1.1 kilometres north-west of the subject land. The sale is slightly smaller in size, but is in a superior location, in spite of its slightly further distance to railway stations. The sale is inferior in access due to its smaller frontage, but because of its slightly superior City views is seen as overall slightly superior to the subject land. The sale sold in June 2002 for $350,000, was analysed at $346,000, and applied at $345,000.
· Sale 4 – (17 Sylvan Avenue, Nundah – Lot 6 on RP 51273). This is a 890 square metre improved parcel located about 100 metres west of the subject land. The sale is larger in size, but has inferior views compared to the subject land. There are no City views, and the sale falls gently from Sylvan Avenue to the rear to the north. The sale is seen as slightly inferior due to its inferior views. The sale sold in November 2002 for $470,000, was analysed to have an added value of improvements, including a refurbished dwelling and pool, at $150,000, giving an analysed land value of $320,000, which was applied at $290,000.
Mr Brown also provides another sale which he refers to as a remark sale to demonstrate the general ongoing level of the market at that period. This sale was at 11 Imbros Street, Nundah (Lot 44 on RP 51273). This is a 607 square metre parcel located about 40 metres east of the subject land. The sale occurred after the relevant date at 14 January 2003 for $364,000. The existing dwelling was removed, and a new dwelling commenced. The sale faces west, and has only side facing views of the City centre, although it looks to the west to Mt Coot-tha. The sale was seen as slightly inferior to the subject land, and has an unimproved value of $305,000.
Mr Brown argues that the views from 11 Imbros Street are restricted to a very small part of the veranda, a matter Mr Ryan disagrees with as he argues that the views are good from the front of the dwelling on that site. Mr Ryan argues that any risks to the views from 11 Imbros Street are far less than the risk to the views from the subject land.
In respect of the sales at Aland Street, Mr Ryan notes that 36 Aland Street (Lot 1), has an area of 479 square metres, and has mountain views to the west, and sold for $235,000; while Lot 2 has an area of 653 square metres and sold for $250,000. He argues those sales support his estimate of $250,000 for the subject land. Mr Brown rejects that conclusion as he argues that the sales in Aland Street are inferior to the subject land.
In respect of the general level of the market at 1 October 2002, Mr Ryan agrees that it has been rising over that period. Whilst he also agrees that Sylvan Avenue is elevated, he notes that it is not as elevated as areas in Wavell Heights, or in Westwood Street, Nundah, near Sale 3. In respect of his assessment of improvements upon the sales relied upon by Mr Ryan, he advises that while he made no special allowance for depreciation of any dwellings, he had applied his own knowledge of the building’s value to assess the added value of improvements.
In the matter of the sale of the adjoining property at 259 Buckland Road, Mr Ryan agrees that property is located upon a busier road with more traffic impact, and is also lower in elevation than the subject land. Mr Ryan has spoken to the purchaser and advises that ongoing additional costs following the purchase have included subdivisional costs to reconfigure the parcel ($5,000) and demolition costs of the old dwelling ($15,000).
Mr Ryan explains that in his estimation of the added value of the 40 year old cavity brick dwelling upon his Sale 1 at 20 Sylvan Avenue, he had made no allowance for depreciation, as he believes the cavity brick dwellings tend to increase in value with age. Mr Ryan estimates the size of that dwelling at 200 square metres, providing a unit cost of $750 per square metre for that structure.
Mr Brown rejects that conclusion. Mr Brown argues that the added value of that dwelling was between $35,000 and $43,000. Mr Brown has used aerial photography in his estimate of a dwelling area of only 100 square metres. Based upon Rawlinsons Building Guide for 2002, Mr Brown estimates medium standard replacement costs of $865 per square metre, plus a garage of $400 per square metre, and $10,000 for landscaping and other improvements. He then depreciates those costs between 50% and 60% to arrive at his range of added values.
Mr Brown advises that he was aware of the sale of 20 Sylvan Avenue, but he had adopted the sale across the road at 17 Sylvan Avenue, because of the later date of the former sale on 16 January 2003, which was some three months after the relevant date in a rapidly rising market. Mr Brown concedes that there is some potential for City views from 20 Sylvan Avenue, but he notes that the land there does not fall away as much as on the subject land, and the dwelling behind was therefore higher. On that basis he believes there was some risk of losing any potential for City views following redevelopment. He notes that 20 Sylvan Avenue had an unimproved value of $290,000 at the relevant date.
In his analysis of his Sale 4 at 17 Sylvan Avenue, Mr Brown advises that he had estimated the depreciation upon that older refurbished timber dwelling at only 30%, compared to the higher rate on 20 Sylvan Avenue. He argues that reflects the better capitalisation of 17 Sylvan Avenue compared to the under-capitalisation of the dwelling on 20 Sylvan Avenue, which has failed to take advantage of any potential City views. In explaining further why he chose 17 Sylvan Avenue rather than 20 Sylvan Avenue, Mr Brown concedes that the more comparable area of the latter and its potential for City views would generally ensure 20 Sylvan Avenue was a more like with like comparison than the larger 17 Sylvan Avenue. However he argues that is outweighed by the later date of 20 Sylvan Avenue sale in the rising market. He also argues that the larger area of 17 Sylvan Avenue (890 square metres) is balanced by its narrow and deep shape, which mitigates any future further subdivision of that parcel.
In summarising his analysis of the subject land, Mr Brown agrees that the two new lots on 259 Buckland Road actually cost about $200,000 each. While he has not personally analysed that sale, he offers an opinion that if compared to his Sale 1 at 48 Brae Street, he believes those parcels would have a likely value of $250,000 on the relevant date. Mr Brown also advises that he believes the sale of 259 Buckland Road was a low sale anyhow, and may have involved some element of risk of gaining Council approval for the redevelopments. Mr Ryan advises that he has personal knowledge that the sale had been subject to subdivisional and development approvals at the time of sale. Mr Brown also argues that he feels that even after development of the two new dwellings upon 259 Buckland Road, there was likely to remain some City views from the subject land. However he agrees that if that does not occur, then that would be a matter for a subsequent revaluation.
Decision:
Before considering the evidence I note that the unimproved value of the subject land is defined by s.3(1) of the Act which states:
“3.(1) For the purposes of this Act –
‘unimproved value’ of land means –
(b) in relation to improved land – the capital sum which the fee simple of the land might be expected to realise if offered for sale on such reasonable terms and conditions as a bona fide seller would require, assuming that, at the time as at which the value is required to be ascertained for the purposes of this Act, the improvements did not exist.”
The intentions of the legislation are clear, and were emphasised in the findings of the Privy Council in Tetzner v. Colonial Sugar Refining Company Limited (1958) AC 50, where Their Lordships said at 57:
“What in Their Lordships’ opinion is required in the present case is that the physical improvements, with any value which they attach to the land on which they are situated, be excluded from the valuer’s computation. The land will then be valued as land devoid of buildings but situated in the community with the amenities and facilities which have grown up around it”.
That also followed the findings of the Privy Council in Tooheys Limited v. The Valuer-General (1925) AC 439 where Their Lordships said at 443:
“Now, what he has to consider is what the land would fetch as at the date of valuation if the improvements made had not been made. Words could scarcely be clearer to show that the improvements were to be left entirely out of view. They are to be taken, not only as non-existent, but as if they never had existed.”
In simple terms the land is to be treated as if all the improvements had not occurred, while all the existing surrounding development at the time of the valuation are to be considered extant.
Now while the land is to be seen as outlined above, what must be considered is the potential for the land to be developed within the current planning constraints covering housing development. Clearly the value of the land is to be determined in full understanding of all of the features and circumstances of the land, following negotiations between the well informed and prudent hypothetical buyer and seller. The existing views of the City centre to the rear would occupy the mind of those people, as would also the risk of redevelopment of the former old dwelling on 259 Buckland Road. On that basis the potential for development of a two-storey dwelling on the hypothetically vacant subject land would also be a consideration in the mind of the parties. However it is agreed that at 1 October 2000 there continued to exist distant views of the City centre.
The major difference between the parties would appear to lie in their understanding of the reduction of $15,000 in the value allowed by Mr Brown. Mr Ryan argues that is not enough for the loss of City views. Mr Brown argues that the $15,000 allowed only addresses the “risk” of future potential loss of the views. Mr Brown does not agree that future City views will be totally lost, but agrees that if that did occur a further reduction in the value was likely to be appropriate. The test is then whether the $15,000 represents a fair estimate of the future risk in view of the apparent redevelopment of 259 Buckland Road?
Comparison of Sales –
Both parties agree that the best evidence of value is by comparisons with sales of comparable lands in the area. In respect of determining unimproved values, Mr Brown seeks primary reliance upon sales of vacant or lightly improved lands. That follows guidance of courts at all levels, and particular in respect of the matter of WM and TJ Fischer v Valuer-General (1983) 9 QLCR 44, where the Land Appeal Court said at 46:
“It is indeed a fundamental principle of valuation that the best basis for assessment of unimproved value is the use of sales of vacant or lightly improved parcels. Whilst maintenance of correct relativity is also of considerable importance for rating or revenue type valuations, we cannot prefer in the circumstances of this case, the use of the principle of relativity to the exclusion of the sales evidence.”
That was also adopted by the Land Appeal Court in R and MM Barnwell v Valuer-General (1990-91) 13 QLCR 13, at 17; and also PH Clough v Valuer-General (1981-82) 8 QLCR 70 at 76:
However to provide a check upon his determination of value, Mr Brown also relies upon comparisons with an improved sale at Sale 4, 17 Sylvan Avenue. Now the problems with adopting improved sales are highlighted by the diverging analyses of Mr Brown and Mr Ryan with their sales of improved lands. That raises the issue of the added values which improvements bring to the land. It was noted for example in the Land and Environment Court of New South Wales in Mood & Ors v Cowra Shire Council (1999) 103 LGERA 260, where Talbot J said at 263:
“It is important to discern between the cost of improvements and their value at the date of acquisition (see Collins and Anor v Livingstone Shire Council (1972) 127 CLR 477 at 484 and 500; 56 LGERA 409 at 413-414 and 425, and Blue Mountains City Council v Mulcahy (1998) 45 NSWLR 577 at 587; 100 LGERA 193 at 201).”
A similar conclusion was also found in Barber & Ors v Valuer-General (1986-87) 17 LGERA 409, at 411 per Else-Mitchell J, at 411. In that matter it was the depreciated replacement cost that was relevant and not the actual cost of replacements. It was also noted that the added value of improvements will also vary according to the economic conditions prevailing at the relevant date. Hence the importance of guidance from sales in the market place. (see O’Brien Nominee Pty Ltd v Valuer-General (1979) 6 QLCR 280).
If I turn to the two analyses of the 20 Sylvan Avenue sale, I find the major difference of opinion about the size of the existing dwelling, as well as its rated value. Because of the age of that building (40 years) and its failure to build to maximise any City views that might be achieved, I agree with Mr Brown that some depreciated value should be applied. The use of the Rawlinsons Guide is well recognised, and I accept the adopted replacement rate for 2002 as used by Mr Brown. Because of its age the existing dwelling was also likely to reflect some level of obsolescence in design. On that basis I believe Mr Brown’s estimate of a depreciation rate of 50% to 60% would appear reasonable, and the added value of about $40,000 is more realistic than the figure of about $140,000 proposed by Mr Ryan.
However I note the much lesser depreciation rate that has been applied to the 17 Sylvan Avenue sale at only 30%. Whilst such variations in depreciation rates may support the current longstanding relativities between parcels in Sylvan Avenue, the potential for considerable variations lends weight to the reason why sales of unimproved lands are to be preferred. As there is no apparent scarcity of vacant land sales, then I accept that the 17 and 20 Sylvan Avenue sales are merely secondary support sales.
I turn then to Mr Brown’s lesser reliance upon the otherwise more comparable sale at 20 Sylvan Avenue, and note that while a subsequent sale some three months after 1 October 2003 may be acceptable, its value in a rapidly rising market would have required some adjustment in its application. The use of a subsequent sale has been considered as appropriate up to the date of issue of the valuation. That was directed in KP and RD Weisenberger v The Valuer-General (1978) 5 QLCR 125; and also in RG McMurray v The Valuer-General (1983) 9 QLCR 35, at 36.
Support is also to be found in Daandine Pastoral Company Pty Ltd v Commissioner of Land Tax (1943) 7 The Valuer 299. In that matter Williams J in the High Court of Australia said at 304:
“Values must be calculated in the light of circumstances which existed on the material date, in this case, 30 June 1939, but subsequent events can be taken into account in order to determine the proper weight to attach to such circumstances. Subsequent sales are just as admissible in evidence as prior sales provided that in all the circumstances they are comparable. If between the material date and the date of the subsequent sale, supervening events occur which alter the conditions previously existing, the subsequent sales would not be comparable and would be useless.”
Support for the use of subsequent sales is also to be found in McCathie v Federal Commissioner of Taxation (1944) 69 CLR 1, at 16; and also in Federal Commissioner of Taxation v Harris (1980) 30 ALR 10 at 18. However in Harris, Fisher J noted at 25 that the subsequent event cannot create an expectation which was not in existence at the relevant date.
In making any adjustment in the application of the sale at 20 Sylvan Avenue in January 2003, Mr Brown would have relied upon his experience as a valuer in such circumstances. In that regard I note that courts have held that valuation is a matter of judgment by persons with the special training and skills evident in a registered valuer. The matter of valuation is also noted by the Land Appeal Court in Chief Executive, Department of Natural Resources v Radlett Enterprises Pty Ltd (1997-98) 18 QLCR 397, where it referred to a decision of the High Court at 404:
“As Mason J said in ‘Federal Commissioner of Taxation v St Helens Farm (ACT) Pty Ltd’ (1980-81) 146 CLR 336 at page 381:
‘Valuation is a matter of estimation, not a precise mathematical calculation.’”
As Mr Brown is the only expert evidence in this matter I accept his opinion of why he did not apply the 20 Sylvan Avenue sale.
I turn then to the sales of vacant or lightly improved lands, and note the following comparisons:
SaleDate Area Unimproved Comparison
Value
36 Aland Street 6/2002 479 sq.m $212,500 Mountain views
2 Aland Street - 653 sq.m. $250,000 Mountain views
29 Imbros Street 2/2001 619 sq.m. $170,000 Mountain views
48 Brae Street 9/2002 426 sq.m. $247,500 Smaller/inferior City views
21 Brae Street 9/2002 512 sq.m. $192,500 Smaller/inferior no City views
37 Westwood St 6/2002 512 sq.m. $345,000 Slightly superior City views
11 Imbros St. 1/2003 607 sq.m. $305,000 Slightly inferior mountain
views
Subject land - 637 sq.m. $315,000 -
I note that the 29 Imbros Street sale occurred well before the relevant date in an agreed rapidly rising market, which is demonstrated by its much lower value to the later 11 Imbros Street sale. On that basis I rejected 29 Imbros Street comparison.
If I look then at the two Brae Street sales, which occurred about the same time, accepting that there are other features associated with each site, the general presence of City views at 48 Brae Street, in spite of its smaller area, reflects about $50,000 more than the 21 Brae Street sale, which has no City views. Clearly the presence of City views adds some premium to a property. If I look then at the Aland Street sale, while mountain views and City views are likely to be a matter of personal preference, the market would appear to place a higher premium on the City views.
In seeking comparisons with 11 Imbros Street, Mr Brown has allowed for removal costs of an old dwelling. While he has not indicated whether that old dwelling was sold for removal, at some financial benefit to the purchaser, or was demolished at a further cost, he has only applied a very conservative 84% of the sale price of $364,000. That presumably also allows for the rising property market over the three months since 1 October 2002. Whatever the reason that applied value of $305,000 would support a higher value for the subject land, because of the better City views from the subject land.
The comparison with the slightly superior sale at 37 Westwood Street at $345,000, would suggest a value of about $330,000 for the subject land, prior to any allowance for risk to those City views. On that basis I see no reason to challenge Mr Brown’s unimproved value originally at $330,000. The only matter of conjecture is the $15,000 that Mr Brown has applied for the risk of losing the City views, which were extant at the date of valuation in October 2002.
If I turn then to the sale at 259 Buckland Road, I note that parcel is lower than the subject land, and has more traffic along Buckland Road. The new parcels each of 466 square metres represent only 73% of the area of the subject land. Presumably as the new developments may place at risk some obstructions to the City views from the subject land, then the two new parcels must have the same current potential views as existed on the subject land at October 2002.
On that understanding either new parcel must be valued at less than the subject land. Whilst the evidence is that the cost to the purchaser reflected about $200,000 for each parcel at about the relevant date, Mr Brown offers the opinion that it was a low sale. He argues that if normal profit and risk allowances were made to that sale, then a fair market value would have been about $250,000. There is insufficient evidence to reject such an opinion by the only registered value in this matter.
If I then consider the matter of relativities with surrounding parcels, I find that Mr Brown has retained the previous relativities which have existed at least for the past five years. However I note his concern that future relativities, including the subject land, may need revision.
Summary:
In summarising this matter, I note that s.33 of the Act directs that unless the Chief Executive has been found to have made an error or followed a wrong principle, then the applied unimproved value is to be taken as correct. I note also that in respect of an appeal against the valuation then s.45(4) of the Act places the onus upon the appellants to prove their case. On the evidence that has not occurred, and I find no fault in Mr Brown’s determination.
Conclusion:
Having considered the whole of the evidence I am not persuaded that the appellants have proved their case. The appeal is dismissed, and the unimproved value of Lot 25 on RP 51273 as determined by the Chief Executive in the sum of Three Hundred and Fifteen Thousand Dollars ($315,000) is affirmed.
NG DIVETT
MEMBER OF THE LAND COURT
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