Why Council Rates keep going up and up?

The common misundertanding is that property prices go up and this drives the council rates up, this is incorrect our rates are based on council spending and waste not on property prices.

If your property increased in value in line with the rest of the properties in your council area,e.g. every property doubled in value and your council kept its budget the same your rate would stay the same, if the council reduced its expenditure then your rates would fall by the same percentage.

The council sets a budget then takes the total council area property value set by the valuer general and divides the area value into the council budget to set a rate figure. Eg. Council area value M$3,000 Council budget M$12, the rate would be 12/3000 = .004 So a $300,000 property would pay $1200

If the total area property valuation increased by 10% and the council increased their budget by 5% rates would increase by 5% e.g. M$3000 becomes M$3300 and M12 becomes M12.6 so 12.6/3300 = .0038181 if your property is now worth $330,000 the new rate would be $1260. Same thing applies if property prices dropped by 10% and council spends 5% more your rates will still go up.

Property valuation is the most common way councils spread their rate burden, they can use a different rating methods including property uses/location, separate rate for a particular purpose, have a service rate or charge for a specific service like septic tank effluent disposal and having a fixed (flat) charge as part of the general/single rate, they can alsi include rebates for residents and pensioners.
The bottom line is rates make up around to 60% of the council income, and councils do not control there spending we all pay more regardless if property prices go up or down.

The only way to achieve lower rates is to support new growth in the area while keeping council spending in check – a dream, more than a reality.