Frequently Asked Questions
Questions we often receive about Land Value Rates and what it will mean for your city.
What is Land Value Rates?
Land Value Rates is a proposal to levy rates based on a property's land value, rather than its total value. This has the effect of both incentivising more housing supply and reducing rates for the average homeowner.
What will happen to my rates?
The change in rates will vary from household to household, but chances are you will be paying less under Land Value Rates. Our analysis shows that 60% of Wellingtonians would pay less under a switch to LVR, and that number is even higher in many other cities and districts. You are especially likely to be paying less if you live in multi-unit housing or further out from the city centre. If you are the owner of Wilson Parking, bad news: you will be paying more.
Will this really increase housing supply?
Yes. In Wellington, rates are a $500M/year drag on development. This is a significant barrier to new housing supply, particularly for townhouses and apartments. Some politicians will tell you that rates are too small to make an impact, while also telling you that rates are out of control. These two things can't both be true. We at Common Ground Aotearoa understand that rates are increasingly hard to afford, and we don't want this to be the reason new houses aren't getting built.
Is this policy progressive?
Yes. On average, less wealthy homeowners will pay less under Land Value Rates, and the richest few will pay more. This is because less affluent areas tend to have much lower land values.
What about rural areas?
Many rural areas will pay less under Land Value Rates, because rural land is far far cheaper than urban land. Many councils charge rural properties a lower rate to reflect the provisions of services, and we support this.
Is this a new idea?
No, the idea of taxing land and reducing taxes on buildings to make cities more affordable goes back over a century, and various places around the world have tried it, to great success.
How can I get involved?
If you live in Wellington and want to join our 2025 local campaign efforts, please email us. If you live elsewhere in the country, we encourage you to write to your local councillor/s and make sure they are aware of the benefits of switching to Land Value Rates.
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