Feature article

Auckland property owners face rate hikes despite CV declines

Let's break down what's happening.

Last updated: 10 June 2025

Heaps of Auckland property owners are in a bit of a head-scratching situation. Their property's capital value (CV) has dropped, but their council rates are still on the rise. It's a real head-scratcher that’s left lots of Kiwi wondering what’s going on.

We get it. On the surface, it doesn’t seem to make much sense. Let's break down what's happening.

First up, what even is a CV?

A Capital Value (CV) is just the council's best guess of your property's market value at a single point in time. They use this number as a starting point to figure out how much your property rates will be.

You’d think a lower CV would mean lower rates, but that's not always how it works.

So, why are my rates going up if my CV is down?

It feels a bit like a magic trick, but there are a few real reasons why this can happen. It all comes down to how the total rates pie is sliced and diced.

The council’s budget comes first. Auckland Council decides how much money it needs to run the city and provide all the services we use. This total amount is the starting point. Even if property values dip, the council might need to collect more money overall to cover its costs, which means a higher rates bill for everyone.
The cost of everything is going up. Just like for the rest of us, inflation pushes up the council's costs for wages, materials, and services. To keep the city running, they need to adjust rates to cover these higher expenses.
Big projects need funding. Things like major infrastructure upgrades or new community facilities don't come cheap. These big-ticket items are funded by rates, so when it’s time to build, rates can go up regardless of what the property market is doing.
It’s about your slice of the pie. Rates are based on your property's value compared to all other properties in Auckland. If your CV dropped by 5% but your neighbour’s dropped by 15%, you'll end up paying a bigger slice of the total rates bill. It’s a bit of a balancing act.

Thinking about selling and want to know what your property is worth in the market? Match with a local agent to get a free appraisal.