Valuation Best Practice Program

History of Valuation Best Practice

Valuation Best Practice guidelines were introduced by Valuer-General Victoria in 1998 as part of reforms to rating authority valuation practices in Victoria. The reforms were developed by the Valuation Reform Reference Group made up of local government, employer and State Government representatives. The group recommended that councils continue as the valuation authority, that valuations be conducted every two years and that valuation standards be improved throughout the state.

Prior to the introduction of Valuation Best Practice, councils across Victoria revalued properties in their municipalities every four to six years. Amendments to the Valuation of Land Act 1960 were made in 1998 that required councils to move to biennial valuations from 1 January 2000 with the Valuation data to be returned to councils within six months.

Following the introduction of the amended legislation, all Victorian councils began restructuring their valuation programs. More than $3 million from the Estate Agents Guarantee Fund was distributed by Land Victoria to help councils set up electronic systems for the collection and storage of valuation data and property information.

To establish Victoria’s new level playing field for valuations, 150 valuers and support staff gathered a consistent range of property information under the same rules. Councils collected and electronically stored 21 standard pieces of data for every property in their municipality. Additional specific data to adequately describe each of the main property classes (residential, commercial/retail and rural) was also collected so that computer-assisted valuation could be generated. For example, residential properties required an extra 10 specific descriptors.

The first valuations returned under the new system reflected values at 1 January 2000 at which time the State’s 2.2 million properties totalled $430 billion. For the first time, property valuations more closely reflected market values. The revaluation significantly improved the quality and uniformity of property valuation information and provided a solid foundation for further development of each council’s land information database and for understanding the Year 2002 revaluation.

Primary Objectives

1. Improvement to valuation and property information in Local Government across Victoria with Statewide biennial valuations.
2. Improved access to relevant data for end users such as the State Revenue Office and utilities through the promotion of electronic collection, maintenance and storage of uniform valuation information by Local Government.
3. Maximum period of six months between level of value date and return date for valuation.
4. Improved standards on which councils undertake valuations.
5. Greater ‘in house’ efficiencies for Local Government associated with improvement to both valuation information and its management.

Stakeholder	Benefits
Land Victoria /Valuer-General Victoria	Improved standards for valuation data and supervision for effective administration of 7A Certificates (confirmation of the satisfactory completion of specified work) under Valuation of Land Act 1960; Greater frequency/currency of valuations; Uniformity of valuation data elements collected to support valuation assessments; Consistency and uniformity of data/greater equity and quality of valuations; and Substantiation to support GTC (Generally True and Correct Certificates).
Councils	Improve public perception and awareness of the valuation reflection of market evidence and trends; Less objections and appeals; Greater transparency of Revaluation process and improved public acceptance of the valuation based rating system; Enhanced property and valuation data sets owned by councils; Electronic collection, maintenance and storage of valuation data; Improved in-house efficiency; Reduced long term valuation costs due to adoption of electronic methodologies; Reduced disputation due to enhanced quality of valuations; Greater contract efficiencies, reduce future revaluation costs; Greater scope for planning overlays due to improved availability of valuation data; and Potential for commercialisation of property and valuation data.
State Revenue Office	Potential elimination of valuation equalisation factors; Improved data quality and format for land tax collection; Improved in-house efficiencies; and Matching of property ownership details.
State Government	Improved credibility of the base upon which Commonwealth Grants allocations are assessed; and More equitable base for assessment available to Victorian Grants Commission