Neighbouring private and government-owned residential blocks in at least four suburbs have had unimproved values rated differently, with the value of private blocks rising while the value of the government-owned blocks remained flat, despite all the blocks being a similar size and zoned for the same use.

The Sunday Canberra Times is aware of government-owned housing blocks in Ainslie, Narrabundah, Gilmore and Melba that have been valued less than neighbouring privately-held blocks, despite being zoned for the same use and being a similar size.

In one Melba cul-de-sac, the unimproved values of four government-owned blocks did not rise between 2020 and 2021, a publicly available government database showed, while eight privately-owned blocks had unimproved value increases between $10,000 and $13,000 between 2020 and 2021.

The four government-owned blocks on Paling Place, which ranged from 667 square metres to 900 square metres, all retained their unimproved value of $354,000 in 2021.

Six neighbouring privately-owned blocks, which had been rated in lockstep with the government-owned blocks every year since 2017, were rated to be worth $364,000 in 2021. The privately-owned blocks ranged in size from 697 square metres to 945 square metres.

On nearby McEachern Crescent, an 830-square-metre government-owned block was valued at $354,000 in 2020 and 2021, while a 798-square-metre privately-owned block two doors down was rated at $354,000 in 2020 and $364,000 in 2021.

Three blocks side-by-side in Gilmore, which were valued the same between 2017 and 2020, were valued differently for the first time in 2021. Two government-owned blocks retained their value of $308,000 while a slightly larger privately-owned block was rated at $338,000 in 2021.

Not all government-owned blocks in the ACT retained their unimproved value between 2020 and 2021.

The stable unimproved values on government owned blocks would mean the Commissioner for ACT Housing would pay slightly less in rates than the neighbouring private owners.

Rates are calculated using the average unimproved value, generally over five years, so the difference in one year would not have a large effect on a property's rates bill.

Unimproved value is largely hypothetical, because it is supposed to be the value of the block as if no house or building had ever been built on it and its lease could be sold in a state ready for development.

"Valuers assess the unimproved value of each block by analysing the sale prices of similar properties. When possible, they use the sale price of vacant land in the area for comparison, making adjustments for any individual differences, such as size, location, aspect and view that may impact the value of each block," the ACT Revenue Office said on its website

"If there have been no sales of vacant land in the area or in comparable areas, valuers work from the sales of improved properties and deduct amounts for improvements. From this information, they calculate an unimproved value of the sale blocks and use these to assess the unimproved value of other blocks."

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A spokeswoman for the Commissioner for ACT Revenue said the unimproved value of all rateable land in the ACT was determined in the same way, whether it was owned by the government or privately held.

"The Commissioner for ACT Revenue determines unimproved values for rates assessment purposes each year based on the advice of qualified, independent valuers who conduct an annual property valuation process and recommend unimproved values for each property," the spokeswoman said.

"The unimproved value is what the block of land is worth subject to its highest and best use in accordance with the purpose clauses in the Crown Lease. It does not include any improvements on the land, such as buildings, landscape, gardening, paths and fences."

The spokeswoman said there could be various reasons for differences in the unimproved values for blocks that are next to each other, including the size, shape, physical features and location of each block.

"It may be that the purpose clauses in the Crown Lease or the highest and best use of a block is different to the neighbouring block or property. A block may have been revalued by the process of benchmarking, regrading, or a decision made not to change the value," the spokeswoman said.

"There are additional considerations in the valuation of territory owned public housing properties. Tenure and use may vary considerably between public housing properties and those that are privately owned. For example, some public housing properties do not have a Crown Lease, whereas all privately owned properties have a Crown Lease; some public housing properties have lease purpose clauses that only permit public housing use, whereas privately owned properties usually include a broader residentially-based purpose clause.

"While these properties have had their values adjusted over recent years, during the 2021 revaluation program it was decided to conduct a broad review of the unimproved values for all territory owned public housing properties in 2022 as the unimproved values of these properties have not been collectively reviewed (as a group) for some time."

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