# 2017 Property Assessment Shock



## Karen (Jul 24, 2010)

The BC Assessment Authority has just posted this year's property assessments online, and I had quite a shock when I saw mine. The value of my 1795 square foot one level, no basement house in Surrey (a suburb of Vancouver) was assessed at $1,027,000 - up from $688,000 last year. I was expecting a big increase, but not that big! It's in a nice neighbourhood, but certainly not a luxurious one.

Here are the details and a photo of my house: https://evaluebc.bcassessment.ca/Property.aspx?_oa=QTAwMDA3NVI3Uw==

Sorry, that first link didn't work. I have corrected it.


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## Beaver101 (Nov 14, 2011)

Holy $$$$h1t of an increase in assessment. It looks like your entire neighbor had the same type of increase with the bulk being on the "land" but I think the guy at your BCAA board is way off his rocker anyways based on a simple visual of neighbouring properties. Some of the properties there have bigger lots but are assessed lower. I can't see anything special about your lot/land (other than a better grass manicure) compared to that of your neighbours with lower "land" assessment.


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## Karen (Jul 24, 2010)

I'm thinking of appealing it, Beaver. But appeals are apparently rarely successful, and I'm not well these days, having had a stroke last summer and also diagnosed with heart failure recently, so I'm not sure I want to subject myself to the stress of going through an appeal.

If I decide to appeal it, I will certainly post the results!


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## dubmac (Jan 9, 2011)

same everywhere. Now here's the not-so-nice consequence - http://www.vancouversun.com/metro+h...sing+property+assessments/11629739/story.html
Taxes go up. Homeowners grant disappears


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## Beaver101 (Nov 14, 2011)

Karen said:


> I'm thinking of appealing it, Beaver. But appeals are apparently rarely successful, and I'm not well these days, having had a stroke last summer and also diagnosed with heart failure recently, so I'm not sure I want to subject myself to the stress of going through an appeal.
> 
> If I decide to appeal it, I will certainly post the results!


 ... I think you should get your entire neighbourhood to appeal, at least the land portion.


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## OhGreatGuru (May 24, 2009)

Karen said:


> I'm thinking of appealing it, Beaver. But appeals are apparently rarely successful, ...


Appeals of what "market value" is are rarely successful. But if you can find an error in your property description that can be successful. When Ontario's MPAC went on-line you could look up the technical description of your property that they used to make their assessment. I found they measured the area of my basement as if it extended under my grade-level garage - something rarely done in residential construction in most of the country. They had no problem re-assessing for a technical error like this - but the process took some months.


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## Just a Guy (Mar 27, 2012)

I've successfully appealed my property values. The trick is having good comparables. He most successful years to appeal are the purchase year, as that has an actual sale amount.

That being said, assessed value is rather meaningless as it doesn't really mean your paying more in taxes. Municipal taxes are proportionally based, so as long as your value is the same as your neighbour's your portion of the tax won't increase. Think of dividing a pie, there is only one pie, if you take 1/8th of the pie, someone takes half, someone a quarter and two others take 1/16, does it matter if you divide the pie up based on numbers if one guy has 8000, one has 4000, one has 2000, and two people have 1000? He division remains the same. 

That's why it's usually not worthwhile to appeal taxes over $10k, it's virtually meaningless in the amount you'll save...in BC, 100k diffference won't save you much on taxes. A 10% reduction on assessed value doesn't equate to a 10% tax savings.


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## Karen (Jul 24, 2010)

You're certainly right that a large increase in assessment doesn't necessarily mean an increase in taxes, but in my case, I'm quite sure it will. I say that because the municipal government has announced that the average increase in assessments this year is about 30%, and only people whose assessed value more than that will see an increase in their taxes. My increase over last year was 49% so I'm afraid I'm going to be one of the unlucky ones!

Another point that wouldn't be in my favour is that a house at the end of my block, built just a year later by the same builder using the same plan sold last summer for $1,030,000, so the comparables don't work for me either.


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## Beaver101 (Nov 14, 2011)

I say baloney to JAG's post ... any increase in assessment will mean an increase in taxes unless the mill rate goes down and what are the mill rate going down for the services provided by the municipality, unions et al?


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## Karen (Jul 24, 2010)

dubmac said:


> same everywhere. Now here's the not-so-nice consequence - http://www.vancouversun.com/metro+h...sing+property+assessments/11629739/story.html
> Taxes go up. Homeowners grant disappears


I'm okay there, dubmac, at least for this year. The upper limit in order to be eligible for the homeowner's grant is $1.2 million so I'm under that. Premier Clark has said that will consider raising that minimum in view of the huge increases in assessments, but she hasn't done it yet.


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## Karen (Jul 24, 2010)

Beaver101 said:


> I say baloney to JAG's post ... any increase in assessment will mean an increase in taxes unless the mill rate goes down and what are the mill rate going down for the services provided by the municipality, unions et al?


Believe it or not, our mill rate has gone down a few times in the past when there have been big increases in assessed values. And our new mayor will be very unpopular if she and her council don't drop them this year considering the huge increases - historically the largest increases ever.


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## Karen (Jul 24, 2010)

OhGreatGuru said:


> Appeals of what "market value" is are rarely successful. But if you can find an error in your property description that can be successful. When Ontario's MPAC went on-line you could look up the technical description of your property that they used to make their assessment. I found they measured the area of my basement as if it extended under my grade-level garage - something rarely done in residential construction in most of the country. They had no problem re-assessing for a technical error like this - but the process took some months.


I reviewed the details pretty thoroughly, and I can't find any errors in the property description, unfortunately.


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## Karen (Jul 24, 2010)

Beaver101 said:


> ... I think you should get your entire neighbourhood to appeal, at least the land portion.


If one of my neighbours launches an appeal, I will certainly join it, but I simply don't have the stamina to start the process myself.


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## Just a Guy (Mar 27, 2012)

Beaver101 said:


> I say baloney to JAG's post ... any increase in assessment will mean an increase in taxes unless the mill rate goes down and what are the mill rate going down for the services provided by the municipality, unions et al?


You should understand how the tax system works. If all assest values increase by 10%, your portion of the tax burden will not increase based on the assessed values. If the mill rate increases, your tax bill will go up accordingly. 

Of course, if your portion increases more than other, as in Karen's case, then you will most likely pay more, but it doesn't mean you'll necessarily pay significantly more. Her place increased nearly 20% more than average, but her taxes probably won't increase anywhere near 20%. Considering the average house price in Vancouver, she probably barely moved up the scale. 

It's the same in my case where I usually get my assessments lowered, having bought below market value. Though I usually get the appraised value decreased by more than 30%, but my tax savings is usually not that much. Of course, it's better than nothing and can add up over the years.


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## Beaver101 (Nov 14, 2011)

Just a Guy said:


> You should understand how the tax system works. If all assest values increase by 10%, your portion of the tax burden will not increase based on the assessed values. If the mill rate increases, your tax bill will go up accordingly.
> 
> Of course, if your portion increases more than other, as in Karen's case, then you will most likely pay more, but it doesn't mean you'll necessarily pay significantly more. Her place increased nearly 20% more than average, but her taxes probably won't increase anywhere near 20%. Considering the average house price in Vancouver, she probably barely moved up the scale.
> 
> It's the same in my case where I usually get my assessments lowered, having bought below market value. Though I usually get the appraised value decreased by more than 30%, but my tax savings is usually not that much. Of course, it's better than nothing and can add up over the years.


 ... so based on your understanding of how the property "tax system" works, it sounds as Karen hasn't been paying her fair share of taxes, correct? If not, then Karen will get a double whammy when that mill rate also goes up.

As for your case where you got your assessments lowered as having bought below "market value" via re-appraisals, you would be considered an exception to the norm, perpetually holding despite the housing bubble we're having.


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## Just a Guy (Mar 27, 2012)

I agree, it looks like Karen is facing an increase in her tax bill, but it may not be a huge increase.

There are certain cases where it makes sense to buy real estate, even in this market. I suppose I could flip my properties for a "quick buck", but that's not the type on investor I am. I've found I'm not very successful when I try to do something against my nature. I prefer to buy and hold, it fits my personality. At the prices I pay, I'm building in the bubble correction in my offers. Doesn't work very often. 

I didn't win my appeals because of a re-appraisal, I got it because I bought the property at a certain price. It's hard for the city to argue that the market value of a property is more than what I paid for it on the open market. I'm lucky in that I find a few properties which are below market, there aren't many, even if you look across Canada. I have won appeals in other years as well, but that's usually after a correction. In those cases I have my realtor pull up a list of comparable properties which sold for less than my assessment. Since I do a lot of work with my realtors, they do these kind of things for me.


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## new dog (Jun 21, 2016)

I am going to be in trouble as well this year karen as my house assessment went from 1 million last year to 1.5 million this year and I will lose the grant. It is correct for my neighbourhood sales but I am a little ticked off at the city of Richmond. I complained in the news paper that while I have endured all the construction and traffic problem of numerous condo's being built I won't see any relief in taxes with all the new tax payers coming in.


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## Karen (Jul 24, 2010)

I hope it won't affect the amount you have to pay in taxes too much, new dog. I'll cross my fingers for you that Christy Clark does decide to raise the upper limit for eligibility for the home owners grant. 

In B.C. seniors have the option of deferring the payment of property taxes until we die or sell the house, but I will never do that because of my aversion to being in debt. I couldn't sleep at night if my property taxes were accumulating over the next few years.

As I recall, our property tax bills don't come out until May or June, but I will post what the effect of this huge assessment increase does to my tax bill for 2017.


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## madmoney (Jan 17, 2015)

I feel your frustration, mine went from $643,000 to $965,000 (North Delta).

I successfully appealed my value a couple of years ago, but it was based on interior finishing. I had demo'd the basement and BC Assessment was showing 5 bed/4 bath, when it was currently 4bed/3 bath. Was only able to get them down ~$20K. As I'm doing the work permitted, BC Assessment assured me they'd update the value when the permit closes...

I spoke with the person at BC Assessments regarding the pricing and what I could appeal, as my property is valued significantly higher than my neighbors (over 100K). My house had sold 3 times over the last 10 years, so they had records of selling prices, as well as pictures of interior upgrades. They took no account to the fact it was valued over comparable properties in the neighborhood, and would only comment that they other houses were likely undervalued but they would catch up with them when they sold....they just didn't have the manpower to proactively keep up with individual homes.

I'll be interested as well to see what this does to my actual property tax bill. I always say, I don't have a problem with paying taxes, it's just that I don't trust the people I give my money to to spend it properly!


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## Just a Guy (Mar 27, 2012)

I hear some "experts" calling for a 50-80% correction in Vancouver prices next year...

If your complaining today, imagine if this prediction comes true and the mill rate goes up...

"My assessed values dropped and my taxes went up!!!"


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## BoringInvestor (Sep 12, 2013)

Just a Guy said:


> You should understand how the tax system works. If all assest values increase by 10%, your portion of the tax burden will not increase based on the assessed values. If the mill rate increases, your tax bill will go up accordingly.
> 
> Of course, if your portion increases more than other, as in Karen's case, then you will most likely pay more, but it doesn't mean you'll necessarily pay significantly more. Her place increased nearly 20% more than average, but her taxes probably won't increase anywhere near 20%. Considering the average house price in Vancouver, she probably barely moved up the scale.
> 
> It's the same in my case where I usually get my assessments lowered, having bought below market value. Though I usually get the appraised value decreased by more than 30%, but my tax savings is usually not that much. Of course, it's better than nothing and can add up over the years.


Just chiming in to say I'm glad someone understands property taxes; namely an increase in assessed value =/= necessarily equal a higher tax bill.
It all depends on i) your increase relative to the average, ii) any newly taxed developments, and iii) the increase in city property tax revenue as decided by council.


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## Beaver101 (Nov 14, 2011)

BoringInvestor said:


> Just chiming in to say I'm glad someone understands property taxes; namely an increase in assessed value =/= necessary equal a higher tax bill.
> *It all depends on i) your increase relative to the average, ii) any newly taxed developments, and iii) the increase in city property tax revenue as decided by council*.


 ... perhaps you can elaborate on all your 3 points here since it seems like you have a full understanding of how property taxes work. But I do have one simple question: does property taxes ever go down without an appeal of assessment and a static mill rate?


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## Just a Guy (Mar 27, 2012)

Yes, if the property value decreases...let's say you demolished the house, your tax bill will decrease.

On the whole though, taxes rarely decrease...it's "free money" to the government and those who ask for it.


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## Karen (Jul 24, 2010)

madmoney said:


> I feel your frustration, mine went from $643,000 to $965,000 (North Delta).
> ...I'll be interested as well to see what this does to my actual property tax bill.


I guess we'll all be waiting more anxiously than usual for our tax bills to come in the Spring, madmoney. Your assessment is a full 50 percent higher than last years. Wow! But at least neither of us will lose our homeowner grant as so many others will this year unless the government does something to stop that from happening. Good luck!


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## Beaver101 (Nov 14, 2011)

Just a Guy said:


> Yes, if the property value decreases....


 ... and what are the chances of a property value decrease, barring it's not next to a nuclear plant or that there is no housing collapse? 



> ... let's say you demolished the house, your tax bill will decrease.


 ... not necessarily if the assessment on the land continues up and makes up for the house's assessment. Karen's area seems to be a good example. 



> On the whole though, taxes rarely decrease...it's "free money" to the government and those who ask for it.


 ... yes, particularly for those who wastes it and has no shame.


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## OhGreatGuru (May 24, 2009)

Beaver101 said:


> ... But I do have one simple question: does property taxes ever go down without an appeal of assessment and a static mill rate?


The question is a non-sequitor. Jurisdictions that have gone to market value assessments don't use static mill rates. In simplistic terms they take the city budget for the coming year, and divide by the total value of assessments in the city, to come up with a mill rate. (If I recall it's a little more complicated than that - I believe they throw in a factor depending on the property classification, so commercial pays a higher rate than residential for example.) But the principle is the same. Mill rates are determined by the budget and the gross value of assessments. That rate is then used to calculate the specific tax bill of individual properties. The budgets are not determined by assessments x a fixed mill rate.


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## AltaRed (Jun 8, 2009)

Beaver101 said:


> ... perhaps you can elaborate on all your 3 points here since it seems like you have a full understanding of how property taxes work. But I do have one simple question: does property taxes ever go down without an appeal of assessment and a static mill rate?


As mentioned already, mill rates are not static. It is a calculated number essentially based on budget requirement divided by the aggregage market assessment in the municipality. Large increases in market assessments WILL result in a lower mill rate this year than last year.

Example: 
2015 Budget requirement $100 milion, total MA assessment $4 billion. Mill rate = 100/4000 = 0.025
2016 Budget requirement $105 million, total MA assessment $6 billion. Mill rate = 105/6000 = 0.0175

Now let's say one's house in 2015 is market assessed at $500k.... Taxes payable = $500,000 x 0.025 = 12,500
But in 2016, the house is market assessed at $750k....Taxes payable = $750,000 x 0.0175 = $13,125

The only reason taxes went up is because the municipality had 5% more budget needs.

In reality, municipalities look for new development to increase the tax base.... so maybe if there was a lot of new development, aggregate market assessment was actually $7billion rather than $6billion. In this case, the mill rate would be $105/7000 = 0.015. The taxes on that $750k house would now be $750,000 x 0.015 = $11,250 ....less than they were in 2015.

IOW, that is why one ALWAYS wants to attract new development to their municipality. Burnaby residents should be really happy to have a Kinder Morgan expansion :tyrannosaurus:


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## Just a Guy (Mar 27, 2012)

We shouldn't forget that, in many municipalities only half of the property taxes are municipal taxes, the other (approximate) half is the education taxes set by the province, but collected by municipalities. The amount the province chooses to raise for education can be higher than the municipal tax increase, so they get blamed when, in reality, the province just grabbed more money.

I've seen cities where they actually lowered the taxes, but the province raised it higher than usual so taxes still went up.

Face it, as long as people are making money, the government will try and take it from them.


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## indexxx (Oct 31, 2011)

I live in Port Moody, and I got an increase of 19% on my one bedroom condo. i was extremely surprised when I opened my mail yesterday- almost $40k in one year! How is that even possible on a condo?


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## mordko (Jan 23, 2016)

indexxx said:


> I live in Port Moody, and I got an increase of 19% on my one bedroom condo. i was extremely surprised when I opened my mail yesterday- almost $40k in one year! How is that even possible on a condo?


Easy. It all depends on how much comparable condos in your area are selling for. 12 months change in Vancouver = 16% on average; your condo is only 3% up on that.


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## OnlyMyOpinion (Sep 1, 2013)

AltaRed said:


> ... IOW, that is why one ALWAYS wants to attract new development to their municipality. Burnaby residents should be really happy to have a Kinder Morgan expansion :tyrannosaurus:


:snowman: I understand with the recent weather they are using a lot more of those damned HC's too. I suppose we could arrange to not supply them, after all riding a bike warms you nicely.


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## new dog (Jun 21, 2016)

AltaRed said:


> As mentioned already, mill rates are not static. It is a calculated number essentially based on budget requirement divided by the aggregage market assessment in the municipality. Large increases in market assessments WILL result in a lower mill rate this year than last year.
> 
> Example:
> 2015 Budget requirement $100 milion, total MA assessment $4 billion. Mill rate = 100/4000 = 0.025
> ...



If you have dumb asses in council and Mayor then money is wasted on stupidity and you have to endure the development. In Richmond BC we had a road under a bridge and then it was moved in front of the bridge with a traffic light. They could have paid me a 26 OZ bottle of Vodka and I could have told them how stupid this is, instead of paying a engineer big bucks to come up this this stupid crap.


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## BoringInvestor (Sep 12, 2013)

Beaver101 said:


> ... perhaps you can elaborate on all your 3 points here since it seems like you have a full understanding of how property taxes work. But I do have one simple question: does property taxes ever go down without an appeal of assessment and a static mill rate?


Here's a great explainer article from the Torontoist: http://torontoist.com/2014/01/everything-you-ever-wanted-to-know-about-property-taxes/.

As others have mentioned - the short answer is: yes; your property taxes can go down year over year without an assessment.
And to reiterate what others have already said - the mill rate is not static, rather it's calculated based upon the level of revenue the city wants to collect and the total assessed value of all properties.


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## Beaver101 (Nov 14, 2011)

BoringInvestor said:


> Here's a great explainer article from the Torontoist: http://torontoist.com/2014/01/everyt...roperty-taxes/.
> 
> As others have mentioned - the short answer is: *yes; your property taxes can go down year over year without an assessment.
> * And to reiterate what others have already said - *the mill rate is not static, rather it's calculated based upon the level of revenue the city wants to collect and the total assessed value of all properties*. [\QUOTE] ... will look at link spin later.
> ...


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## BoringInvestor (Sep 12, 2013)

Beaver101 said:


> BoringInvestor said:
> 
> 
> > Here's a great explainer article from the Torontoist: http://torontoist.com/2014/01/everyt...roperty-taxes/.
> ...


Yes. Recently it has been going down every year.
You can see historical rates here: http://www1.toronto.ca/wps/portal/contentonly?vgnextoid=859f4cd308a16410VgnVCM10000071d60f89RCRD. 
I assume you'd be most interested in the residential total tax rate, shown in the top line of each table.

To selectively pull out some data points, the mill rate dropped 11% from 2011 to 2015, as it went from 0.7929218% to 0.7056037%.
If we want to go further back to 2001, it has dropped ~26%.


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## Just a Guy (Mar 27, 2012)

Bever101, 

I'm not really sure why you are asking this...we live in an inflationary economy by design, meaning it's a controlled economy where prices are always rising on purpose. The general population even wants this (wouldn't you like a raise?). 

The genreal population also doesn't understand the consequences of this. Maybe this article will help explain the underlying problem.

http://www.easysafemoney.com/why-raises-dont-work-explained-its-as-easy-as-pie/

There is only one source of money in all of Canada, the tax payer. Every time they ask for more services, more roads, more police, more concerts, more sports teams, more rebates, more subsidies, more whatever...someone has to pay for it. Want your taxes to go down, stop asking for more, stop complaining that the government isn't doing enough.

The government isn't the underlying problem, even with their wasteful spending, because basically they are doing what those who elected them asked them to do...give us more! I rarely hear of a government who gets elected saying, we're going to give you less...though Ralph Kline may have done that in Alberta from what I heard. People don't want less, they want more.


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## Just a Guy (Mar 27, 2012)

BoringInvestor said:


> To selectively pull out some data points, the mill rate dropped 11% from 2011 to 2015, as it went from 0.7929218% to 0.7056037%.
> If we want to go further back to 2001, it has dropped ~26%.


You guys are missing the reality of the situation by doing this. It's not the mill rate alone, it's a combination of the mill rate and the assessed value. What you should be looking at is the total budget the municipality is trying to collect, has that gone up or down.

It's easy to fudge the numbers to make the mill rate go down...for example. I need to collect $1M, I divide this up into a million portions each portion is $1 (my mill rate). Now I assess all the homes individually and figure out what ratio each house is worth, some pay more portions, some pay less...

If I want my mill rate to go down, I increase th number of portions is all. Instead of 1 million chunks, I divide it into 10 million and magic, my mill rate has decreased by a factor of 10. I still need to collect the same amount of money, so each home pays more portions.

The usual way a city comes up with the number of portions is based on assessed value. You add up to total price of all the homes, and that's the number of portions. Want to increase the number of portions, increase the assessed value. Each home is then divided by the total to find out your individual ratio, so the amount you pay should always stay fairly close to what it was before...


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## Beaver101 (Nov 14, 2011)

Just a Guy said:


> Bever101,
> 
> I'm not really sure why you are asking this...we live in an inflationary economy by design, meaning it's a controlled economy where prices are always rising on purpose. The general population even wants this (wouldn't you like a raise?).


 ... why not ask about this? Or should we be just complacent little taxpayers and buzz off when bringing out these questions? Or are there something else to hide?



> *The genreal population also doesn't understand the consequences of this.* Maybe this article will help explain the underlying problem.
> 
> http://www.easysafemoney.com/why-rai...s-easy-as-pie/


 ... yep, general sheep population doesn't "understand" the consequences but just pay, right?



> There is only one source of money in all of Canada, the tax payer. Every time they ask for more services, more roads, more police, more concerts, more sports teams, more rebates, more subsidies, more whatever...someone has to pay for it. Want your taxes to go down, stop asking for more, stop complaining that the government isn't doing enough.


 ... of course, services have to be paid and I'm not complaining the government isn't doing enough. They're doing more than enough, helping themselves with annual raises to keep up with the "inflation" and then waste some more. What happened to the "efficiency" model?



> *The government isn't the underlying problem, even with their wasteful spending, because basically they are doing what those who elected them asked them to do...give us more!* I rarely hear of a government who gets elected saying, we're going to give you less...though Ralph Kline may have done that in Alberta from what I heard. People don't want less, they want more.


 ... no, I'm not saying they're the underlying problem ... actually they're the main problem - not doing their job properly. Yes, sadly enough they got elected by those who can't get enough. I'm not sure about you but you sure sound like you don't mind being robbed.


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## BoringInvestor (Sep 12, 2013)

Just a Guy said:


> You guys are missing the reality of the situation by doing this. It's not the mill rate alone, it's a combination of the mill rate and the assessed value. What you should be looking at is the total budget the municipality is trying to collect, has that gone up or down.
> 
> It's easy to fudge the numbers to make the mill rate go down...for example. I need to collect $1M, I divide this up into a million portions each portion is $1 (my mill rate). Now I assess all the homes individually and figure out what ratio each house is worth, some pay more portions, some pay less...
> 
> ...


I'm not following your example re: how you can lower the mill rate by subdividing each homeowner's portion into 10 chunks. Can you please explain further.


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## Just a Guy (Mar 27, 2012)

Not sure how you get that idea. I don't like being robbed any more than anyone else but, by myself, I can't change the system. I can educate myself and understand it. I can educate others. I can vote for people to change things...but that probably doesn't have much effect.

On the flip side I can, and do, successfully appeal my tax assessment all the time, having learned how the system works and how to win. Of course that just means other pay more...it's a closed loop system, not much can be done.

I can also minimize my provincial and federal taxes and choose where my portion goes through understanding the tax system and using it effectively. Businesses do this all the time. We don't get to keep more money than anyone else, but we can control where it goes...of course then people who don't understand this complain about businesses and the rich not paying their "fair share" and call for "tax the rich and corporations". 

I don't see how what you are doing, basically complaining about how it's wrong, is doing anything to change things. 

The vast majority of the population, about half of which are employed by government, and the majority getting some sort of government support, are never going to bite the hand that feeds them. They don't understand that government money isn't "free money" and they don't care. 

Heck, I own a lot of condos, you'd be amazed at how many owners think that condos get some sort of funding from outside the condo fees...people don't want to understand and educate themselves about how things really work, they just want raises and cheaper stuff...reality doesn't work like that.


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## Spudd (Oct 11, 2011)

BoringInvestor said:


> I'm not following your example re: how you can lower the mill rate by subdividing each homeowner's portion into 10 chunks. Can you please explain further.


I think he's saying they need a million bucks to run the town. If they add up the value of all the properties in town, and it's 100 million bucks, then the mill rate is 1%. If the values of the houses in town go up to a billion dollars combined, then the mill rate will be 0.01% but each property will still need to pay the same amount of money because the town still needs a million bucks to run.


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## Just a Guy (Mar 27, 2012)

BoringInvestor said:


> I'm not following your example re: how you can lower the mill rate by subdividing each homeowner's portion into 10 chunks. Can you please explain further.


I knew I had confused it as I wrote it...

Okay, let's try this...

There are three numbers we work with here...the amount of money we collect, the total value of houses, and the amount each homeowner needs to pay. 

To get the mill rate you divided the total amount of money you need to collect by the mill rate. 

So, let's say I need to collect $1M to fund my city of 10 houses.

House 1 & 2 are worth $200k
House 3,4,5 &6 are worth $100k
And 7-10 are worth $50k

Total value of the houses is $1M, my mill rate is $1

House 1&2 pay $200k each in taxes
Houses 3-6 pay $100k each
Houses 7-10 pay $50k each

Total collected $1M


Scenario 2.

I still need to collect $1M, but I want to lower my mill rate.

I appraise ever home at 10x more, so...

House 1&2 are now worth $2M
House 3-6 are worth $1M
Houses 7-10 are worth $500k

Total property values $10M

Mill rate is $1M/$10M or $0.1

Each house still pays the same amount, even though my mill rate decreased by a factor of 10. The appraised values increased by the same amount, so it's a wash. Except some people think they are rich, since their house is worth so much more and their taxes didn't go up...no joke, I know people who've appealed their property taxes to get the assessed value increased.


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## BoringInvestor (Sep 12, 2013)

Just a Guy said:


> I knew I had confused it as I wrote it...
> 
> Okay, let's try this...


In your example you cite a desire to lower the mill rate via artificially inflating the market values of the homes. 

Practically that doesn't happen given the separation between the body that assesses values, and city council that sets the revenue (at least in Toronto, perhaps it's different elsewhere). 
Each side only controls have the equation needed to calculate the mill rate, and the only way the elected body of council could influence the rate lower is if they lowered y/y property tax revenue.


From our collective posts it's clear we both understand how the mill rate works... so I'm not exactly clear what you're saying with your example, and from your previous reply.


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## Just a Guy (Mar 27, 2012)

I was saying looking for a lower mill rate (like Beaver101 wanted) is rather meaningless without looking at the assessed values.

As for somehing like this not happening, this is exactly what this thread was originally about, Vancouver assessments have gone through the the roof this year, and I originally pointed out it probably doesn't mean much.

As there have been several tangents on this thread though, I understand why you didn't see my train of thought.


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## BoringInvestor (Sep 12, 2013)

Just a Guy said:


> I was saying looking for a lower mill rate (like Beaver101 wanted) is rather meaningless without looking at the assessed values.
> 
> As for somehing like this not happening, this is exactly what this thread was originally about, Vancouver assessments have gone through the the roof this year, and I originally pointed out it probably doesn't mean much.
> 
> As there have been several tangents on this thread though, I understand why you didn't see my train of thought.


Cool. Thanks.


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## AltaRed (Jun 8, 2009)

Mill rate is an elementary concept. Why is it seen as so difficult? It is simply budgetary requirement divided by the aggregate market assessment in the municipality. Mill rate does move around and sometimes down like it will this year in municipalities that have had significant market assessment increases. The mill rate will go down in my municipality this year because MAs are up over 10% from last year, there is new development, and budgetary needs of the municipality won't increase anywhere near that much. That said, I will likely (but not necessarily) pay more taxes simply because the municipality has increased budgetary needs.

Municipal budgets HAVE to go up each year because of salary increases, inflationary increases on everything they buy from contracted work to fuel to whatever PLUS any incremental servicing such as bus routes, etc to service new developments. Which is why municipal budgets typically have to go up 3-5% every year. We can argue that one forever but that is not what this thread is about. It is simply about Market Assessments and they go up according to RE price moves. Simple as that.


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## Mechanic (Oct 29, 2013)

Assessments are irrelevant to property taxes, other than deciding your share. I own commercial land that has a higher assessed value than I can sell it for. I had a discussion with the assessors about it but didn't help much.


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## Just a Guy (Mar 27, 2012)

The assessors are paid to discourage people from filing appeals. If you persist, they tend to offer a reduction, especially if you file an appeal...if you have comparables and can make a case, chances are you'll get a reduction. Of course it many appeal, so they don't lose much income. It usually doesn't cost too much to grease a few squeaky wheels.

I've often offered my places to an assessor for the price they pick...when they balk, I ask them why if they thought it was so fair? At the price I paid, I could afford to sell it to them at a nice profit.


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## Beaver101 (Nov 14, 2011)

Just a Guy said:


> The assessors are paid to discourage people from filing appeals. If you persist, they tend to offer a reduction, especially if you file an appeal...if you have comparables and can make a case, chances are you'll get a reduction. Of course it many appeal, so they don't lose much income. It usually doesn't cost too much to grease a few squeaky wheels.
> 
> I've often offered my places to an assessor for the price they pick...when they balk, I ask them why if they thought it was so fair? At the price I paid, I could afford to sell it to them at a nice profit.


 ... assessments are hardly accurate then.


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## Just a Guy (Mar 27, 2012)

That's why I tend to win my appeals.


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## AltaRed (Jun 8, 2009)

I've only appealed once, on a property in Calgary in Canyon Meadows Estates. I got the comparables along with a few photos, and graphed it all out in (I think) 3 different ways with a proposed value point on all three? graphs and averaged for a proposed assessment. The appeals board accepted my value.

Market assessments can rarely be accurate, except within a noise range for almost exact properties. They do not look at individual siting, property conditions, etc. They base it on neighbourhoods, then lot size and footprint, and recent RE sales. That is as good as it can get. 

In our current location, we, along with several other houses, are located in a sweet spot location (view of lake) on a private lane. All of our assessments are low relative to actual market value. Someday that may catch up to us.


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## new dog (Jun 21, 2016)

I just did this today and sent the pictures arguing my house shouldn't be any higher and maybe even lower then the properties beside me.


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## Beaver101 (Nov 14, 2011)

Just a Guy said:


> That's why I tend to win my appeals.


 ... by my comment in post $49, I mean inaccuracy as being "inflated" amounts. Definitely in TO and even you appeal, they can re-appeal you in the subsequent year ... not lower but higher even. 

So what's the secret to successfully winning your appeals?


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## steve41 (Apr 18, 2009)

Here's mine:

Land (7000 sq ft) $3.59M
Buildings (1959 bungalow) $54.5K

Total assessment $3.6M

Yikes!


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## Just a Guy (Mar 27, 2012)

You generally can't win an appeal every year, but I buy new properties every year, the first year I usually appeal based on the purchase price. Hard for them to argue it's worth more on the open market than the price it sold for.

In subsequent years, I keep an eye on the assessments, if they seem high, or an overly large increase, I'll appeal them again. Setting the bar low to begin with is a good start. It's also hard for them to argue that my property went up at a higher rate than the neighboring ones, so it can rise much faster either. 

The biggest secret I'd bet is that I actually file an appeal in the first place and have good evidence that their assessment is wrong. Having a knowledge of prices and how the system works probably also helps. I don't appeal something if it's not worth it, but I've also never lost an appeal.

Haven't recieved all my assessment yet for this year, but I expect to appeal at least 3 properties this year.


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## Beaver101 (Nov 14, 2011)

steve41 said:


> Here's mine:
> 
> Land (7000 sq ft) $3.59M
> Buildings (1959 bungalow) $54.5K
> ...


 ... before I say the same "Y!!!!!" ... what was your land assessment last year? What are they planning to build around your place?


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## steve41 (Apr 18, 2009)

$2.6M and I'm not planning on anything. It's not in Surrey, BTW.


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## mordko (Jan 23, 2016)

steve41 said:


> Here's mine:
> 
> Land (7000 sq ft) $3.59M
> Buildings (1959 bungalow) $54.5K
> ...


What's the problem? This sound like a good thing. If your tax is too high, you can sell the house, buy something rather nice in a cheaper area for $1M and cash the rest. 

Another option is to knock down the house and build something bigger and then sell, but there is an obvious risk that the market will tank in the mean time.


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## Beaver101 (Nov 14, 2011)

^ But is steve41 planning to sell? anytime soon?


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## steve41 (Apr 18, 2009)

Nope. Don't need the money.


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## mordko (Jan 23, 2016)

^In that case, it's not very clear what your problem is.


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## new dog (Jun 21, 2016)

steve41 said:


> $2.6M and I'm not planning on anything. It's not in Surrey, BTW.


Somewhere west of Granville street I would think. Not even south Surrey would see a price like this at that lot size. North Surrey you would probably have bullet holes in your house.


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## Karen (Jul 24, 2010)

My house, which was the origin of this post, is in North Surrey (Fraser Heights) and guess what - it has no bullet holes in it!!! Nor is there a bullet hole to be seen in the houses of any of my neighbours!


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## Just a Guy (Mar 27, 2012)

So, you're saying the assessment is actually lower than it should be since you've got a lead free home...


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## new dog (Jun 21, 2016)

Sorry Karen, my good friend lives in Surrey and we always make jokes about where each other lives. He says things about Richmond and I say stuff about Surrey.


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## Mukhang pera (Feb 26, 2016)

new dog said:


> Sorry Karen, my good friend lives in Surrey and we always make jokes about where each other lives. He says things about Richmond and I say stuff about Surrey.


Living in Richmond means never having to say you're Surrey.


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## Karen (Jul 24, 2010)

new dog said:


> Sorry Karen, my good friend lives in Surrey and we always make jokes about where each other lives. He says things about Richmond and I say stuff about Surrey.


I wasn't the least bit offended, new dog - I was just teasing you! And I must admit that your comment might even be true in certain parts of North Surrey!


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## Karen (Jul 24, 2010)

Just a Guy said:


> So, you're saying the assessment is actually lower than it should be since you've got a lead free home...


No, I think a 50% increase in assessed value is enough to make up for having a lead-free home!


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## Beaver101 (Nov 14, 2011)

*Soaring land values in Vancouver spark a 'property tax revolt'*

http://www.theglobeandmail.com/report-on-business/small-business/sb-growth/soaring-land-values-in-vancouver-spark-a-property-tax-revolt/article33672975/

... summary: great business for *property tax consultants.*


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## carverman (Nov 8, 2010)

Karen said:


> My house, which was the origin of this post, is in North Surrey (Fraser Heights) and guess what - it has no bullet holes in it!!! :highly_amused:
> 
> Nor is there a bullet hole to be seen in the houses of any of my neighbours!


Hence the "lead free" moniker? At first I thought it applied to the copper plumbing in your house ..lead free solder.


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## Just a Guy (Mar 27, 2012)

Beaver101 said:


> *Soaring land values in Vancouver spark a 'property tax revolt'*
> 
> http://www.theglobeandmail.com/report-on-business/small-business/sb-growth/soaring-land-values-in-vancouver-spark-a-property-tax-revolt/article33672975/
> 
> ... summary: great business for *property tax consultants.*


What do they have to complain about? They're all "wealthy" now. People always talking the government to "tax the rich" until they become the "rich"

Yes, this was supposed to be sarcastic.


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## Beaver101 (Nov 14, 2011)

Just a Guy said:


> What do they have to complain about? They're all "wealthy" now. People always talking the government to "tax the rich" until they become the "rich"
> 
> *Yes, this was supposed to be sarcastic*.


 ... LOL ... you're a landlord = businessman too, right?


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## Just a Guy (Mar 27, 2012)

Yes, I'm the root of all evil...just ask berubeland.


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