# BC assesment vs actual value (buying)



## tobuyornottobuy (Nov 19, 2011)

Hi All

I am in BC (Vancouver Island, comox valley)
and wonder what peoples experiences are either here, or in the rest of BC with the comparison of bc assesment values vs sold prices.

I am looking at 2 properties...one is above BC assesment by $100 ($520K), and the other is 30k below....they are both very close in location so just trying to get a better understanding of what BC assesment really means!

Thanks


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## Just a Guy (Mar 27, 2012)

Assessments are just the government's best guess as to the value of your property. It's based on sales of "similar" properties. 

Now, since the government doesn't even drive by the places, let alone go inside, their guess is not very accurate. 

The only time you know the true value is when someone cuts a cheque for it. If you're the buyer, you have to decide if the property is worth the price or not, no other opinion matters. 

I appeal, and win, my tax assessments all the time. Usually because I'm unwilling to pay the amounts others think they are worth.


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## CalgaryPotato (Mar 7, 2015)

I know BC assessment is very similar to Calgary assessment and uses a highly complex and sophisticated logic engine to try and determine assessments. That being said, it isn't always right. Part of it, is that interior condition of the house is unknown, all they typically have to go with is development and building permits which aren't needed for many expensive improvements and don't have any knowledge of damage that happens and is not repaired.

Bottom line though, if you think your property is overvalued compared to other similar properties, challenge it, because there is no benefit to paying extra taxes. If you believe it's undervalued, it doesn't hurt much. I don't think people put a lot of stock in assessment values when home shopping and trying to determine market value of a place.


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## heyjude (May 16, 2009)

^^this.

Years ago, when living in Winnipeg, I renovated my kitchen. I then received an increased assessment. I asked my real estate agent to come and appraise my house so that I could contest the assessment. She was very impressed with the new kitchen and advised me not to contest the assessed value, since the renovation had increased the market value of my home by much more.


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## Mechanic (Oct 29, 2013)

I have been watching Van Isle for quite some time. If you look on the bc assessments site you can see assessed values and what they last sold for. I paid higher than assessed and so did just about every other I've looked at. Seems to be big demand in certain areas and of course that affects the prices. I recently saw more new listings and they still seem to be rising. I'm sure it will level off at some point but I watched it keep going up for 2 years while "shopping"


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## Karen (Jul 24, 2010)

Another thing to keep in mind (in the Greater Vancouver area, at least) is that the land the house is on is assessed at many times more than the house itself, so appealing the assessment based on the condition of the house won't make much difference. For example, my assessment for this year is $1,027,000, broken down as follows: Land (7791 square feet): $906 ,000; Building (my 1795 sq. ft. house): $121,000. Several similar houses in my immediate area are assessed at a slightly lower value, even though they have been completely renovated and mine has not, because my lot is a little larger than theirs.


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## CalgaryPotato (Mar 7, 2015)

You also have to remember that assessment is always behind. So if the market is rising, it's going to be low, and if it's falling it's going to be high. Again remember that the only point of assessment is to try to determine relative values for the purpose of taxation. So as long as everything is falling or rising in relative fashion it doesn't matter if things are over or undervalued according to the market.

This only becomes an issue when you get something like we have here in Calgary, where our downtown business market has crashed, and you suddenly get one part of the city dropping at a much faster rate than anything else is changing, skewing the relative values.

Like Karen says, property is much more important than the house itself. But the property is usually easier to gauge the value of as compared to the house itself.


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## Mukhang pera (Feb 26, 2016)

Karen said:


> Another thing to keep in mind (in the Greater Vancouver area, at least) is that the land the house is on is assessed at many times more than the house itself



Not true without qualification.

I just looked at the assessment for a west side Vancouver property I used to own. It puts the land (54' x 130') at $4,021,000 and the building at $1,686,000. So that land is not worth "many times" the building, built in 2003.

With older buildings, the "many times" doctrine perhaps applies. I also looked at a house I used to own in Kitsilano. It is assessed at $2,332,000 for land (33' x 110') and $45,500 for building (built in 1912).

In about 1978, when I was still at university, I purchased a 1.5-acre waterfront lot in the southern gulf islands. I paid $40,000. I was a bit disappointed when my assessment came in later that year at $30,000. Made it look like I had overpaid by $10,000. The next year the land was assessed at $97,500. Go figure.


In response to the OP's request for experience with current assessed values, particularly Vancouver Island area, the property we are living on now, not far from the Comox Valley, is 60 acres of oceanfront, purchased for about $300,000 about 25 years ago. The assessed value has dropped every year for quite a few years. We have probably spent about $1 million on improvements in recent years. The assessed value is about $550,000, with $235,000 of that being for land. So it is difficult to see it as overvalued, but, just the same, perhaps we should retain JAG to appeal the assessment for us. Also, every day, here on CMF and elsewhere, we read dire warnings that Canadian house prices are in "bubble" mode and due for a major correction. That might see this place fall into negative territory, where we would have to pay someone to take it.


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## tobuyornottobuy (Nov 19, 2011)

Thanks guys! I feel like they are both overpriced but then I am a little tight! LOL
Our experience has been buying properties at slightly over assesment here in the Comox valley but prices are just getting silly!


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## sags (May 15, 2010)

Sales have fallen 70% in Vancouver, and listings have increased substantially.

The average price of a detached home has fallen $1.8 million to $1.4 million. It looks like a housing correction is already underway.

View attachment 13866


www.greaterfool.ca


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