Well, it's that time of year again - the time of year when the dreaded tax assessments have arrived in the mail. This year's assessments have been a bit of shock to most of us homeowners. To say they went up a little, would be like saying the Titanic hit an ice cube!
The silver lining is that there is no reason to panic. Just because the assessed value of your home has gone up, does not necessarily mean that your property taxes will go up. I'll explain why.
Your Property Taxes are calculated according to the following formula:
ASSESSED VALUE X PROPERTY TAX RATE = PROPERTY TAXES
There are two ways your Property Taxes can increase:
1. If your property's Assessed Value increases MORE than the average property; or
2. The Property Tax Rate is increased by your Taxing Authority.
The average home in Port Alberni had an increase in Assessed Value of 18% according to the Mayor of Port Alberni.
While the Assessed Value is an important part of the equation, you can see that the Tax Rate is also important. Last year, the City of Port Alberni increased the Tax Rate by 3%. At the time they indicated a plan to do the same in 2019. However, we have a new Major and City Council this year, so we'll have to wait and see.
Let's look at an example - If you live in Port Alberni property's Assessed Value increased by 18%, and the average increase for Port Alberni was 18%, than your Property Taxes won't increase (unless the City of Port Alberni increases the Tax Rate).
Now that we have looked at how taxes are calculated, and hopefully taken away some of our original knee jerk reaction, let's look at when and how to appeal. A property's Assessed Value is based on what the property was worth in July of the previous year. If you believe that the 2019 Assessed Value does not reflect the true value of your property in July 2018, you should absolutely appeal. The deadline to appeal your 2019 Assessed Value is January 31, 2019. The BC Assessment authority outlines how the appeal process works. We have helped a number of Clients win appeals over the years, by providing comparable sales data. They key is to enter the processed prepared. If you are a client of The Fenton Team, and you think you should appeal your Property Assessment, please don't hesitate to reach out to us for help with real estate information.