Last Friday’s BC Assessment roll-out of information showed property values in the Okanagan are stable or have increased.
News of a small increases or decreases in the assessed values of our houses, condos or townhomes won’t mean much — the only number that counts is the final sale price. That’s because this assessment is based on sales from six months ago and permitted land use as of Oct. 31 while sale price is determined by current market forces.
Assessment time is an annual rite for many of us, fraught with trepidation and perhaps celebration as most find their property values have continued to increase at a pace greater than inflation. So while we like to amuse ourselves with value appreciation/depreciation data for our properties — and especially those of our neighbours — these assessments are mostly useful for gauging the property tax bite we’ll face mid-year.
City bureaucrats will tell you that a small rise or fall in your property’s value won’t change your taxes much as long as the change in your assessment doesn’t deviate too much from the average. For example, if property values rise on average five per cent over the previous year and yours went up 10 per cent owing to a renovation or a surge in high-value home sales in your neighbourhood, your taxes might take a noticeably larger bite out of your budget.
It’s really city bureaucrats who need this information because they use it to determine property taxes residents and businesses will pay. Still, for many homeowners, the annual property tax assessment revelation is an opportunity for a bit of post-holiday discussion.
While it’s nice to see one’s property value increase each year, in investment terms, there’s no harm in being average.