Lets start at the other end. How many times have you seen the Government Valuer in your house?
Most people would answer never as statistically it is impossible to get round all the properties residential and commercial within the time frame required. Rateable valuer are updated every three years in Wellington. The value is based on land value and the improvements to give a Capital Value. How many valuers at QV are doing htis job...it will vary but lets say twelve....figuratively speaking you would be luck if they changed down to second as they went past your house. The reason the value is put on a house is to be able to charge a tax (rates). Noboby likes taxes so the value attributed is never going to be on the high side of the valuers opinion.
The valuers will look at some sales in the area and then apply a formula over the whole based on the analised sales, known as setting the tone of the area. So if the sales show a 7 % increase they will apply that across the board. They are also supposed to take into account any additions or improvements done since the last valuation. The only way they are informed of this is throught the buildings consent process, so if you undertake improvements to a dwelling that do not require a consent then the Government Valuer is not going to know about them. The figure makes no allowance for chattels. Being totally cynical Real Estate Agents will use rateable values when it suits them to sell a place and ignore it if it gives the 'wrong' answer.