VALUATION OF LAND AND OTHER LEGISLATION AMENDMENT ACT 2010 No. 7 - SECT 5 5 Amendment of s 3 (Meaning of unimproved value)

VALUATION OF LAND AND OTHER LEGISLATION AMENDMENT ACT 2010 No. 7 - SECT 5

(1) Section 3(1)(a), from 'offered' to 'require'--

omit, insert--

'negotiated as a bona fide sale'.

(2) Section 3(1)(b)--

omit, insert--

'(b) in relation to improved land--the capital sum that the fee simple of the land might be expected to realise if negotiated as a bona fide sale, assuming the improvements did not exist.'.

(3) Section 3(2) and (2A)--

omit, insert--

'(2) However, the unimproved value of improved land can not be less than the sum that would be obtained by deducting the value of improvements from the improved value on the date of valuation.

'(2A) The assumption mentioned in subsection (1)(b) is limited to the instant in time when the valuation is to be made on the date of valuation.'.

(4) Section 3(2B)--

insert--

'(c) the making or use of an improvement to the land.'.

(5) Section 3(2C), 'subsection (1) or (2)'--

omit, insert--

'subsection (1)(b)'.

(6) Section 3(4), after paragraph (b)--

insert--

'(c) there is no greater risk than that which applied to the actual use of the land in its actual condition, on the date of valuation, in realising the use of the land, or continuing the use of the land, for any purpose for which it was being used on the date of valuation;'.

(7) Section 3--

insert--

'(5) To remove any doubt, it is declared that--

(a) the benefit of a lease, agreement for lease or any other instrument of any type relating to land, or improvements on land that enhances the value of the land, as unimproved or improved must be included in its unimproved value; and

(b) the following apply for assessing the unimproved value of land--

(i) the bond rate must be adopted in analysing--

(A) the added value of improvements on the land including any allowance to be made under this section or section 5; and

(B) the added value of improvements involved in any comparable sale of improved land;

(ii) no amount can be deducted for goodwill whether in analysing the improvements on the land, or any comparable sale of improved land, or otherwise;

(iii) no deduction for any profit and risk allowance or development premium can be made for the realisation of the use of the land, or for continuing the use of the land, for any purpose for which it was being used on the date of valuation;

(iv) if the land is improved and the assessment includes a comparison with sales of vacant or lightly improved land, or with sales for redevelopment, an amount representing the development premium inherent in the value of the land as improved must be added to the level of value established by the sales;

(v) the benefit to the land of the payment of infrastructure charges or of infrastructure construction must be included; and

(c) the term 'unimproved value' defined under this section has been given a special meaning that must be applied whether or not that definition accords with the ordinary meaning of that term.'.