Turner v Chief Executive, Department of Natural Resources and Mines
[2002] QLC 5
•23 January 2002
LAND COURT
BRISBANE
23 JANUARY 2002
Re: Appeal against Annual Valuation
Valuation of Land Act 1944
City of Rockhampton
(AV2000/0074)
Keith D and Sonia M Turner
v.
Chief Executive, Department of Natural Resources and Mines
(Hearing at Rockhampton)
D E C I S I O N
This is an appeal by landowners in the North Rockhampton suburb of Park Avenue, against the unimproved value applied to their property by the Chief Executive, Department of Natural Resources and Mines (the respondent) under the provisions of the Valuation of Land Act 1944 (the Act).
Introduction
Mr and Mrs Turner (the appellants) are the owners of a parcel of land situated at 105 Boland Street, North Rockhampton, described as Lot 168 on Registered Plan 613154, Parish of Murchison, County of Livingstone, containing an area of 757 m². As at 1 October 1999, the respondent valued that land at $36,000 under the provisions of s.37(1) of the Act.
The landowners unsuccessfully objected against that valuation and then appealed to the Land Court, advising that their estimate of unimproved value was $32,500. They contended that the valuation was excessive on the following grounds:
· the situation and environment of the subject land;
· the high plastic clay content of the soil in the area; and
·the market for land in Rockhampton, the population of which is either stagnant or decreasing, affecting the market for land.
Mr Keith Turner appeared and gave evidence on behalf of the appellants and Mr M Craig appeared on behalf of the respondent, while evidence on behalf of the respondent was given by registered valuer, Mr AW White, of the State Valuation Service.
The Subject Land
The following details are summarised from the report prepared by Mr White, which was uncontentious.
The subject property is situated at 105 Boland Street, being approximately 900 metres north of the Rockhampton Shopping Fair in the North Rockhampton retail precinct. The location of the property was therefore considered to be an attractive feature. The allotment is on the northern alignment of Boland Street, approximately 47 metres from the intersection of Stumm Street, in what Mr White perceived as the better-located area of the suburb of Park Avenue. The surrounding locality has been developed with single-unit and multi-residential development.
Boland Street is fully bitumen sealed, with concrete kerbing and channelling. It provides single-lane traffic flow in either direction and is of sufficient width to allow parallel kerbside vehicle parking. The street connects directly to Yaamba Road, approximately 260 metres to the north-east. Yaamba Road forms part of the Bruce Highway, which links Rockhampton to both northern and southern centres. However, the proximity of the subject land to Yaamba Road is considered by Mr White to be only a minor detriment.
Reticulated town water supply and sewerage, overhead electricity and telephone services are connected. A daily mail delivery service and a weekly garbage collection service are also provided to the property.
Mr White described the subject land as an average sized, irregular shaped, inside allotment, with a gentle cross-slope from the northern boundary to the south-western alignment. He considered the property to have a good building contour, but with no views or outlook worthy of mention. He considered the site to be adequately drained and according to the City Council flood maps, it is above the Q100 flood level. However, Mr White thought that the high clay composition of the soil would make the site susceptible to foundation movement. He went on to say that this disability is inherent in the majority of surrounding properties in the immediate locality, as well as in several other suburbs in North Rockhampton.
The subject property is zoned "Residential A" under the Town Planning Scheme for the City of Rockhampton, which was gazetted on 8 March 1986. Further controls are exercised through the Council Strategic Plan, gazetted on 21 March 1997. The property is developed with a single-unit residential dwelling which Mr White considers to be the highest and best use of the property.
The Case for the Appellants
Mr Turner went to considerable trouble to prepare for this appeal. He had obtained figures from the Australian Bureau of Statistics for census population data for 1986, 1991 and 1996. Those data show that the population of Rockhampton had increased by 4.7% between 1986 and 1991, but had fallen in the period between the 1991 census when the population was 59,394 and the next census in 1996, when the population was 57,770.
Mr Turner had obtained details from the Rockhampton City Council of the development of subdivisional estates in the city, which showed that between the census dates 1991 and 1996, an additional 1,812 allotments were created. Mr Turner argued that the law of supply and demand would indicate that with a greater number of allotments and a smaller population, the price of allotments should have fallen, rather than increased by 10% since the previous valuation.
Mr Turner generally agreed with Mr White's valuation report. However he made the point that the reference to "the perceived better located area of Park Avenue" is totally relative. He considered Park Avenue to be a low socio-economic area and an older part of Rockhampton. There were several low-budget rental accommodation flats in the immediate area of the subject land, which did nothing to enhance its amenity.
He considered the plastic clay soil to be a detriment to the neighbourhood. He said there is significant and noticeable cracking of walls, fencing, pavement and kerbing.
In relation to the argument regarding supply and demand, Mr Turner also made the point that the Carara Drive subdivision was completed in 1993, but a number of allotments remain undeveloped and in July 2001 (after the relevant date) there were at least six of those undeveloped properties still for sale.
On the basis of those arguments, Mr Turner contended that the valuation of the subject land should not have increased by 10%.
The Case for the Respondent
Mr White saw the subject land in a somewhat better light than Mr Turner. He stated that it was in a better area of the Park Avenue suburb. He contended that at the river end the suburb was very poor, but towards the highway end it became quite good. He classed it as a semi-modern estate, not new, but quite modern by Rockhampton standards. He considered that at the date of valuation there was a relatively healthy demand for vacant sites. The problem, he thought, was the lack of supply in a well-established area where there was not a lot of vacant land available. However, he said that the market for improved properties at that date was static, or possibly declining. While Park Avenue was by no means the best suburb in North Rockhampton, it was an area where people would build a modest low-set three-bedroom brick house, as it was close to all amenities. The number of duplexes and flats in the vicinity was, Mr White said, characteristic of the locality.
To support his valuation, Mr White referred to three sales of vacant land in the North Rockhampton area.
Sale 1 is situated at 63 Carara Drive, North Rockhampton, contains an area of 730 m², is zoned "Residential A" and sold in September 1999 for $47,500. Mr White analysed that sale to show $45,500 and as at the date of valuation, 1 October 1999, the respondent had applied an unimproved value of $42,500 to that property.
Mr White described that sale property as a near level, inside site, having a regular shape and good building contour, with fully sealed bitumen access and concrete kerbing and channelling. The site is fully serviced and has underground power. It is situated in a new estate on the former drive-in theatre site. It backs onto a drainage park reserve. Mr White considered the property to be superior to the subject land; while it was similar in building contour, shape and size, it was superior in location and level of services.
Mr Turner did not agree that the sale was comparable to the subject land. He thought it was in a much better neighbourhood, with modern, low-set brick veneer homes, with modern facilities, such as underground power. While he contended that the sale property was superior, he could not say if there was sufficient difference between the value applied to that land of $42,500 and the value applied to the subject land of $36,000. He said they were difficult to compare.
Sale 2 is situated at 15 Stenlake Avenue, North Rockhampton, contains an area of 778 m², is zoned "Residential A", and sold in August 1998 for $46,000. Mr White analysed that sale to show an unimproved value of $42,000, but as at the relevant date, 1 October 1999, the respondent had applied an unimproved value of $37,000 to that property.
Mr White described the sale property as a near level, inside site, having an irregular shape and good building contour, with fully sealed bitumen access and kerbing and channelling. The site is fully serviced and has overhead power, being situated in a semi-modern fully established residential estate. It is located at the end of a cul-de-sac and has very small street frontage. Mr White considered the sale to be similar in building contour, size, location and services to the subject land, but inferior in shape. Overall he considered it to be similar.
Again, Mr Turner did not consider the sale to be similar to the subject land. He said it is situated in a better neighbourhood, with modern low-set and high-set brick veneer houses, a different neighbourhood to that of the subject land. He considered it to be a more attractive area.
Sale 3 is situated at 4 Davidson Street, North Rockhampton, containing an area of 579 m², zoned "Residential A", which sold in September 1997 for $43,000. Mr White analysed that sale to show an unimproved value of $39,000. As at the relevant date, 1 October 1999, the respondent had applied an unimproved value of $32,000 to that property.
Mr White described the sale property as a near level, inside site, having a regular shape and good building contour, with a fully sealed bitumen access with kerbing and channelling. It is fully serviced and has overhead power, being situated in a semi-modern fully established residential estate. He considered this sale property to be inferior overall to the subject land, being similar in building contour, shape, location and services, but smaller.
That property sold to the State Government and Mr Turner considered that it was not a fair representation of what a member of the public would pay for that particular block. He thought that the motivation of the State Government would be different to that of a person who wanted to live there. He agreed that the property was very close to the subject land and in the same environment. However, it is a smaller allotment and he thought that he would not have bought that block.
Mr White thought that the Queensland Government had paid too much for Sale 3. However, it is near the subject land and he had included it as a support sale. He pointed out the sale analysed to $39,000, but he had applied only $32,000 to that property.
Conclusions
Under the provisions of the Valuation of Land Act 1944, the respondent is required to determine the unimproved value of each property in an area as at the date of valuation. Unimproved value has been defined as the market value of the land as if improvements thereon or appertaining thereto had not been made. It is settled law that the best method of determining unimproved value is by reference to sales of unimproved or lightly improved land: Grahn v. The Valuer-General (1992) 14 QLCR 327.
Mr White, on behalf of the respondent, has attempted to value the subject land in that manner. He pointed out that he had increased the valuations of the whole of the North Rockhampton area by 10%. While he had no sales of directly comparable land, there were sales in the North Rockhampton area of vacant or lightly improved land. Those sales, although perhaps not ideal, are the best basis of valuation available at the relevant date.
Mr Turner based his challenge to the valuation on the fact that the population in Rockhampton is either static or declining. Since more allotments are being created, he reasoned that that there would be less demand for allotments with a declining population. He also referred to the detriments to the value of the subject land, in terms of its environment, with multi-unit residential properties in the vicinity and the clay plastic soil which causes cracking of walls and other improvements.
However, Mr Turner did not produce any sales evidence contrary to that produced by Mr White. He had inspected each of Mr White's sales and, while he did not consider any of them to be directly comparable, he did not challenge any of the details advanced by Mr White about those sales. Two of the sales were superior to the subject land, while the third sale, the support sale, was inferior. Mr Turner was unable to assist by giving some indication of how much superior the two sales were to the subject land, although his evidence does indicate that the third sale is quite inferior.
In the circumstances, I must find that Mr White has adopted the correct principles in valuing the subject land. While comparisons with sales which are not directly comparable are always a matter of judgment, Mr White is a qualified registered valuer with years of experience in the Rockhampton area. It is therefore very difficult to set aside his opinions on the basis of the case advanced by Mr Turner. Mr Turner has raised some valid points, but I am of the opinion that Mr White has successfully answered all of the challenges which were made to his valuation. Therefore the appeal must fail.
Order
The appeal is dismissed and the respondent's valuation of the subject land of Thirty-six Thousand Dollars ($ 36,000) as at 1 October 1999, is affirmed.
JJ TRICKETT
PRESIDENT OF THE LAND COURT
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