Image via WikipediaIt’s the time of year when we receive our property assessment in British Columbia. Every home owner receives a mail that says what the value of their property is. Most values went up in B.C. for 2011. Not many had a decrease in value. My area had a 9% increase over the past year.
How is my property assessed?
The provincial government has setup a crown corporation called BC Assessment to review and assess all the properties in B.C. There is a set of criteria that is looked at to come up to the value but the formula is not simple math from what I can see but there has to be an algorithm somewhere … In any case, here are the main criteria affecting the value:
- Lot size
- Property square footage
- Property age
- Re-sale price in area
- Permit demand in area
Every cities use the assessment of your residence to define the amount you owe to the city in taxes. The cities define the percentage you pay for all the services and your property tax is based on the assessment of your property. My property tax should come in at around 3,000$ this year.
How do you compare with others?
The BC assessment website allows you, for a period of 2.5 months, to look at any other assessment in the province. It’s quite a rich amount of data as you can see what any other houses sold for during the year along with their assessment for the year. This is information realtors have easy access too all year along with their MLS database and for a short period of time, everyone has access to it.
I took some time to review a couple of sectors and rarely would a house sell for less than their assessment. If it did, it was close to the assessment value.
What about my assessment?
My 2011 assessment went up 11.30% over my 2010 property value. That’s quite an increase for me. If you have read my Net Worth posts, you’ll remember that I valued my residence at 650K$. It was somewhat the market value at the time I started blogging. I realized it was insane to track monthly changes with the markets so I left it as is for the year. What was important, was the increase in equity I was building by paying down my mortgage.
As we moved into 2011, I had decided to go with the assessment from the province as it is a conservative value and one that is safe to use. To my surprise, my assessment went up, pretty much like everyone else in BC for that matter. Aren’t we suppose to be having housing problems? Isn’t there prediction of a housing market correction? In any case, my property assessment came in at 670K$. I am not going to increase my residence value for my net worth. I decided to take the average of the last 3 years which brings me to a value of 628K$. For 2011, I will reduce my net worth by 22K$ by adjusting my property value.
Readers: How is your property assessed in your neck of the woods?