2020 Property Tax Assessment

[topfiverecords]

Originally Posted by Slava

Is it really irrelevant though? The values for my street are all over the map. I really have no idea how the city comes to these values, but its a shambles. Honestly, for a city that complains about money and the budgetary fix it finds itself in, it seems like a good start would be to nail down these figures.

I'm going to say my house is average in my community, and certainly not the most expensive. There is a place a few doors down, which is arguably the same in terms of value and its assessment is 35% less than mine. My neighbour on one side is about 10% more than me and on the other is about 23% less. It's completely irrational.

And as far as the relevancy goes, when you're off by double digit percentages it's entirely relevant. I had my home value "increase" (according to the assessment last year, which I felt was wrong as well) and my tax increase was not double, but close enough. Obviously for me that's frustrating. But again, for a city that has no money for things you would think that they would address these issues and make sure they're collecting the right amounts.

Large discrepancies between assessed values for same year, near an exact copy homes, land area etc is up for a gear grinder and worth exploring yes.

However, some in line with their area are down 3.6%, some 4.2%, I'm down 5.4%, etc. There's too many factors into the equation to worry about being down more or less than others.

Originally Posted by The Yen Man

How is it irrelevant when it's used to determine property taxes? Yes, I know how mill rates work, but it's still to your advantage to have that assessment number as low as possible compared to everyone else's.

Right, but no one is posting:
"I'm down 3.6% and the median for all exact comparable properties in one km radius that have made no changes to their homes are also down 3.6%"

And no one is posting:
"I'm down 1.6% and the median for all exact comparable properties in one km radius that have made no changes to their homes are down 3.6%. What the?"

Assessments go down and then mill rates go up. The average sales price in Calgary is approximately $420,000. I don't know the data but lets say the average assessment is $400,000 to keep things simple. If an assessment went down 1% more than the exact match neighbour the 2020 tax bill is a measly $30/year less.

Originally Posted by Oling_Roachinen

I believe so. High appraised value, low assessed value, that's a perfect combination.

Some potential buyers may want to know if there's any underlining reason why the assessment is low, but lower taxes relative to the actual 'worth' of the house is a bonus. And the blackbox formula to come up with the assessed value, which uses bulk appraisal and values while usually never setting foot in the house, it really shouldn't matter.

As long as the assessed value isn't lower because the property is missing permits, let's say for a garage for example, then I'd still favour a lower assessment.

Until next year's assessment utilizing the sales data and exposure of any improvements.

[GGG]

Originally Posted by Slava

Is it really irrelevant though? The values for my street are all over the map. I really have no idea how the city comes to these values, but its a shambles. Honestly, for a city that complains about money and the budgetary fix it finds itself in, it seems like a good start would be to nail down these figures.
.

The assessed value of homes doesn’t really affect the city budget.

The mill rate is floating. It’s assessed Value / city budget. So if some people are higher then they should be it lowers everyone else’s property taxes marginally. I believe the final Milrate isn’t set until after the appeal deadline occurs so the only real affect on the city is the cost of appeals.

One could argue that by doing a less precise job and having people appeal they save money overall than the cost to improve the accuracy of the process.

[DoubleF]

Originally Posted by Bill Bumface

I mentioned this one of the previous years, but when I bought my house, the taxes were quite low, then jumped up like crazy the next year. I phoned in, and they said they noticed a bunch of renovations in the MLS listing that they were not previously aware of, so the assessment went up.

I did a fairly extensive renovation with permits, and the value went up as a result.

TL;DR: I think your suspicion regarding your house vs. your neighbour is correct.

I think renovations are hard to gauge, so if you do them right, you can run away lower taxes if no one around you is comparable. The problem is that someone could get an appraisal on a home, but the home, pour in $100K of renovations, but afterwards, the appraisal isn't exactly $100K more. It can be less than $100K or more than $100K.

I own a cookie cutter townhouse in Tuxedo and I pay the same as my neighbors. Of the ones I know of, one basement is undeveloped, one spent $15K to partially develop her basement as a gym, and one spent $5K tossing things together in his basement himself to convert it closer to a workshop space. I spent $40K developing my basement in a manner that matches the premium trim of the upper floors and includes an entertainment room and guest bedroom with full ensuite. If all our units were on the market at the same time, I don't think the difference is exactly $25-40K. TBH, I think my unit would be more expensive than theirs by around half that at most.

[PsYcNeT]

Originally Posted by DoubleF

I think renovations are hard to gauge, so if you do them right, you can run away lower taxes if no one around you is comparable. The problem is that someone could get an appraisal on a home, but the home, pour in $100K of renovations, but afterwards, the appraisal isn't exactly $100K more. It can be less than $100K or more than $100K.

I own a cookie cutter townhouse in Tuxedo and I pay the same as my neighbors. Of the ones I know of, one basement is undeveloped, one spent $15K to partially develop her basement as a gym, and one spent $5K tossing things together in his basement himself to convert it closer to a workshop space. I spent $40K developing my basement in a manner that matches the premium trim of the upper floors and includes an entertainment room and guest bedroom with full ensuite. If all our units were on the market at the same time, I don't think the difference is exactly $25-40K. TBH, I think my unit would be more expensive than theirs by around half that at most.

From chatting with some acquaintances in real estate, renos don't often have a net positive resale value (this isn't hard and fast, since the time since last reno, age of home, quality of finishes etc. all factor in). Basement development is usually the only one that is guaranteed to have net positive value since it "adds" usable square footage to the home, but everything else is usually a crapshoot.

The guy who spent 5K probably added the most positive net value to his home realistically, assuming it has 4 walls, a ceiling, and properly installed flooring, lighting and electrical.

[Slava]

Originally Posted by GGG

The assessed value of homes doesn’t really affect the city budget.

The mill rate is floating. It’s assessed Value / city budget. So if some people are higher then they should be it lowers everyone else’s property taxes marginally. I believe the final Milrate isn’t set until after the appeal deadline occurs so the only real affect on the city is the cost of appeals.

One could argue that by doing a less precise job and having people appeal they save money overall than the cost to improve the accuracy of the process.

It's probably my misunderstanding this, but let's just pretend the taxes paid in my block should be $10,000 higher per year in total. Someone gets that money?

[bizaro86]

Originally Posted by Slava

It's probably my misunderstanding this, but let's just pretend the taxes paid in my block should be $10,000 higher per year in total. Someone gets that money?

All the other taxpayers in the city pay a bit extra then.

The city determines its budget and the assessments separately. So if they are consistently too low in your area, your area is paying slightly less than it's fair share of taxes. Then the mill rate is slightly higher and everyone else makes up the difference.

[Slava]

Originally Posted by bizaro86

All the other taxpayers in the city pay a bit extra then.

The city determines its budget and the assessments separately. So if they are consistently too low in your area, your area is paying slightly less than it's fair share of taxes. Then the mill rate is slightly higher and everyone else makes up the difference.

I guess that's what I figured and just makes this such a bizarre system. The values are all over the place and pretty clearly not actually market values. There are too many examoles where the assessed values are out of line compared to the market for that to be the case. Then you have this "it all evens out" sort of rectification, which further makes it inaccurate.

[calgarywinning]

I hate when people tell me your property value is unimportant in the equation of your property tax or that the mill rate factors in any increase or decrease. The job of property valuation is to valuate the property under the act, which is said to use an aggregate of the properties in your nearby vicinity, like for example the street you live on. So add up all the properties and divide.

In fact, the regime of the City of Calgary was to press property values so that the mill rate and tax increase was lower overall and more palatable, through business assessment or residential.

There is a whole appeal process for your property value which has been turned into an attrition by the city, in that you will now have to spend an entire day, before your case is heard instead of scheduling a time in front of the arbitrators (among other costs). What's worse is when you beat them and get your property value held to like the other places on your street, they come back the next year and bump you right back. Creepy they are on MLS looking at photo's of your home, that just goes to show you the leadership of the assessment division.

Property assessors pre 2000's used to be agreeable reasonable people. In the last 15 years at least the mandate was to press property values higher so that the mill rate and tax increase would be lower. They used to openly admit that was the agenda.

So I do hope they have turned a corner. Assess property fairly and correctly under the Municipal Government Act, don't force people who disagree to take them to the Assessment Review Board and also, reduce the fee's to get there and make the process transparent. In fact, just use a computer.

Then have at it with your Mill rate so we can know what the actual tax increase will be.

Also, if it's so unimportant reduce each property assessment change to a 2 years at the least, 3 years next. 4 years seem to long to me.

[Twitchy15]

Do most people find when they buy a house is the assessed value lower? Higher? Or similar to what they pay?

[Weitz]

Originally Posted by Twitchy15

Do most people find when they buy a house is the assessed value lower? Higher? Or similar to what they pay?

I would guess it fully depends on the neighbourhood. In mine, houses routinely sell for 3-4% over assessed value. Others are probably different.

[burn_this_city]

Value down, taxes up. Sweeeeet.

[GGG]

Originally Posted by calgarywinning

Property assessors pre 2000's used to be agreeable reasonable people. In the last 15 years at least the mandate was to press property values higher so that the mill rate and tax increase would be lower. They used to openly admit that was the agenda.

Can you explain your logic in this statement?

The city Tax increase is 2020 revenue requires of property tax / 2019 revenue requires from property tax.

How does pushing property values higher decrease the tax increase?

[calgarywinning]

So let’s say there’s five houses only in this fictional city valued at 300,000 thousand and the mill rate is .01 making the 2019 property tax 3000 for each of the five houses. The city needed 15,000 in 2019.

In this little city of five people they are told its revenue neutral and that the property value doesn’t drive their taxation level, that the mill rate is simply adjusted based on what the city plan to spend. In 2020 they want helicopters to pick up the garbage and need new furniture. So they set it at 20,000. So based on 2019 values the mill rate will now be .01333.

However, this city the mill rate used to be .005 but the mayor has really been spending. Like people are saying we can’t afford a 33 pct increase it’s out of line with inflation. So as the mayor who really wants my agenda I call up property assessment (one of the biggest groups in the city as it is the primary source of revenue) and I say double check your property values, wink wink say no more. One of the residents has listed his property for 360,000 and I’ve seen the photos therefore everyone in the cities home must be worth this and the property values must have gone up 20% for everyone because that is what their home is worth.

Either way to get my 20000 of five residents whose homes are now worth 360,000 my mill rate is now .0111. A much more reasonable increase, the mill rate is lower and palatable. In fact known that I have jigged the numbers to match my budget, why don't I also spend a little more. Yes, I was going to get my pound of flesh, but optics and the tax rate didn't go up that much. The residents are just paying their fair share.

Many people work it back from the city is going to spend this so market valuation is just appropriating the share based on the value of the property. I'm saying the property value and aggressively evaluating allows the city to spend more because the mill rate doesn't move as much to meet the budget. The budget was going to be the budget, so everyone is just paying their fair share.

Why bother with assessment then, just assign everyone their share units like a strata, pass your budget and let the mill rate move to meet the need of the budget.

I've been to Assessment Tribunal dozens of times over the same properties. They just refuse to use market value and look to mitigate the optics of spending by aggressively valuing property. If I win a judgement and my house is value at 600k, but the city wanted it at 780k, the next year they put it back to 780k.

If it's all moot, why do they fight property valuation like vipers in a snake pit? What gives. There was a published article in the herald stating all of this last year, but can't seem to find it. The real battle is in the downtown towers where they have pro's that take the city to task on property valuation and win every time, however, this same group won't rent their buildings to tenants for the same evaluated amounts. But this is another topic all together.

[bizaro86]

Two comments:

1) I think the vast, vast majority of people don't h understand how mill rates work. The media report the tax increase from the budget, and people see the tax increase on their bill. I don't think assessment sleight of hand wins anyone political points.

2) I'm surprised they bumped you right back up. We won an assessment case on a condo about 7-8 years ago. Our unit was assessed way higher than what we paid for it within a couple of months of the date, and other sales in the same (70s vintage) building were in the same ballpark. The assessor was using comps from larger units in nicer/newer buildings, which are way more valuable. Anyway, we won very nearly what we asked for, and our assessment was way lower than the other units in the building for the whole 5 years we owned. It went up by about the same proportion as the other units every year.

[GGG]

Originally Posted by calgarywinning

So let’s say there’s five houses only in this fictional city valued at 300,000 thousand and the mill rate is .01 making the 2019 property tax 3000 for each of the five houses. The city needed 15,000 in 2019.

In this little city of five people they are told its revenue neutral and that the property value doesn’t drive their taxation level, that the mill rate is simply adjusted based on what the city plan to spend. In 2020 they want helicopters to pick up the garbage and need new furniture. So they set it at 20,000. So based on 2019 values the mill rate will now be .01333.

However, this city the mill rate used to be .005 but the mayor has really been spending. Like people are saying we can’t afford a 33 pct increase it’s out of line with inflation. So as the mayor who really wants my agenda I call up property assessment (one of the biggest groups in the city as it is the primary source of revenue) and I say double check your property values, wink wink say no more. One of the residents has listed his property for 360,000 and I’ve seen the photos therefore everyone in the cities home must be worth this and the property values must have gone up 20% for everyone because that is what their home is worth.

Either way to get my 20000 of five residents whose homes are now worth 360,000 my mill rate is now .0111. A much more reasonable increase, the mill rate is lower and palatable. In fact known that I have jigged the numbers to match my budget, why don't I also spend a little more. Yes, I was going to get my pound of flesh, but optics and the tax rate didn't go up that much. The residents are just paying their fair share.

Many people work it back from the city is going to spend this so market valuation is just appropriating the share based on the value of the property. I'm saying the property value and aggressively evaluating allows the city to spend more because the mill rate doesn't move as much to meet the budget. The budget was going to be the budget, so everyone is just paying their fair share.

Why bother with assessment then, just assign everyone their share units like a strata, pass your budget and let the mill rate move to meet the need of the budget.

I've been to Assessment Tribunal dozens of times over the same properties. They just refuse to use market value and look to mitigate the optics of spending by aggressively valuing property. If I win a judgement and my house is value at 600k, but the city wanted it at 780k, the next year they put it back to 780k.

If it's all moot, why do they fight property valuation like vipers in a snake pit? What gives. There was a published article in the herald stating all of this last year, but can't seem to find it. The real battle is in the downtown towers where they have pro's that take the city to task on property valuation and win every time, however, this same group won't rent their buildings to tenants for the same evaluated amounts. But this is another topic all together.

The amount of tax paid per home owner went up the same amount so the media in the city would report the % increase in property tax collected not the % increase in mill rate.

Has city taxation ever been reported or discussed relative to the mill rate increase?

[calgarywinning]

Originally Posted by GGG

The amount of tax paid per home owner went up the same amount so the media in the city would report the % increase in property tax collected not the % increase in mill rate.

Has city taxation ever been reported or discussed relative to the mill rate increase?

From what I gather the media is reporting the mill rate increase. The property valuation has been determined.

The best way to experience it is to go down to the Assessment Review Board, listen to the people fighting the city and listen to the city. It's a real thing, people are beset and unfairly evaluated and the City is not reasonable about it, aggressive and powerful.

I for one would be interested in a legacy tax to protect those peoples properties that have actually increased where they no longer have the means to pay their share of the burden. The old 78 year old man in Inglewood who is forced out based on market value shouldn't be, repairing everyones bike in the neighbourhood. Maybe a clawback on his estate when he dies to the city/province.

It's a real eye opener.

[Fuzz]

I don't think I've ever seen the media report on the mill rate. They report the tax increase, which is just the percentage the budget has gone up from the previous year, which needs to be covered by increased property taxes.

[calgarywinning]

The media reports a very basic version of how the system works.

Tax Rate = Mill rate; terms are interchangeable applied to the property valuation pool as a whole. In order for them to set the Mill Rate/Tax Rate, they need to set the property valuation. That's why everyone gets their valuation on Jan 1 (used to be Mid to end Feb).

The percentage increase reported is on the increase over the collective mill rate/tax rate from the previous year, but is no reflection on the property valuation pool that it is being applied to.

[GGG]

Originally Posted by calgarywinning

The media reports a very basic version of how the system works.

Tax Rate = Mill rate; terms are interchangeable applied to the property valuation pool as a whole. In order for them to set the Mill Rate/Tax Rate, they need to set the property valuation. That's why everyone gets their valuation on Jan 1 (used to be Mid to end Feb).

The percentage increase reported is on the increase over the collective mill rate/tax rate from the previous year, but is no reflection on the property valuation pool that it is being applied to.

The boldest is just not correct. I’d happily concede the point if you can provide articles discussing the increasing or decreasing mill rate.

The % increase reported When the city approves its budget each year in October is the increase in the amount of money from property taxes. They don’t know the milrate increase until the assessments are done.

No one has ever reported on the % the mill rate increased. From about 2003 to 2008 was the media reporting double digit tax rate decreases? Because the milrate was dropping substantially during these periods.

For example in the article of the start of this thread it talks about the change in amount home owners will pay. No where in the article does it mention the mill rate.

For 96 per cent of homeowners, that means their taxes will remain within plus or minus 10 per cent of last year's levy.

[calgarywinning]

Originally Posted by GGG

For example in the article of the start of this thread it talks about the change in amount home owners will pay. No where in the article does it mention the mill rate.

I'd be interested to go back and look at the mill rates, but property value pool goes up mill rate can change, so i'm completely incorrect my bad you are correct!