With the new year comes your new BC Assessment, and this year the feedback we’re receiving is a little different from previous years. Where previously our clients were seeing BC Assessments at a lower price point than their market value, this year we’re seeing them often higher than market value. This is primarily due to an average drop of 17% across the Fraser Valley and Lower Mainland markets, which we’ve discussed extensively over the past few months.
BC Assessments are one of the most misunderstood elements of real estate in this province, so, what do you need to know? Should you be worried if you’re one of the homeowners who’s BC Assessments dropped? Let’s shed some light below.
The Basics: BC Assessment is a publicly owned crown corporation charged with the responsibility of assessing property values across the province, they do this primarily using algorithms that process municipal data as their source information – that means it’s not the most accurate valuation, but it does serve its purpose. They attempt to calculate value as of July 1st from the previous year, in this case from July 1st 2022. Market value has declined for the vast majority of properties in the Lower Mainland since then.
Your BC Assessment: If you’ve misplaced your BC Assessment you can find details here, https://www.bcassessment.ca/ You can also use that site to see how other properties’ BC Assessments compare, although the value of this information may not be that beneficial to you, for the reasons explained below.
Primary Use: Your BC Assessment is primarily for the purpose of calculating property taxes for your municipality. The municipality multiplies your property value against a mill rate, and that’s how your taxes are calculated. Because of that, just because your assessment may be down from the previous year doesn’t mean your property taxes will automatically drop the same amount.
Accuracy: BC Assessment’s algorithms do their best to determine value, but they are rarely an accurate reflection of market value. Market value is, of course, determined by what someone is willing to pay. It is not unusual at all to see properties with a market value six figures lower or higher than their BC Assessment.
Appealing: If you do suspect your BC Assessed value may be higher than market value today you have until January 31st 2022 to appeal. This may be to your advantage as it may reduce your property taxes. See here for more details, https://info.bcassessment.ca/Services-products/appeals.
If you are one of those cases, there is no need for concern that a drop in your BC Assessed value will impact your market value, this is not the case. Professional Realtors involved in real estate transactions are, in most cases, aware of the difference between BC Assessed value and actual market value.
Now more than ever if you are wondering how much your home is actually worth it is essential to have a professional market analysis compiled. If that’s something you’d like help with we’re happy to provide that market analysis at no expense. If you have any other questions about your home’s value or BC Assessment, please don’t hesitate to reach out.