Every four years the province of Municipal Assessment Corporation (MPAC) completes an update on property evaluations in Ontario.
To establish your property’s assessed value, MPAC analyzes property sales in your area. The method, called Current Value Assessment (CVA), is used by most assessment jurisdictions in North America.
When assessing residential property values they look at five major factors that generally account for 85% of the value they assign to properties.
The major factors are location, lot dimensions, living area or square footage, the age of the property adjusted for any major renovations or additions, and the quality of construction.
Other features that may affect value are finished basements including rec rooms, fireplaces, garages, workshops, bathrooms, swimming pools, pool houses, boathouses and docks.
In general, all upgrades that add value are taken into account. Increasingly, urban and suburban site features are being considered when determining value. These include such things as sewer and water, busy street and traffic patterns, corner lots, the proximity to green space or parks and water, and the property’s proximity to industrial wind turbines, railway lines, and hydro and natural gas corridors.
You should look over your assessment carefully to determine if it is accurate and reflects your property’s value.
The reason for the four-year update is to allow for the phase-in of any properties that have dramatically increased in value. That allows for the final increase in the tax bill to be spread over the next four years.
If you disagree with your assessment there is a mechanism to appeal the valuation.
Remember, your assessment is not responsible for your real estate tax bill. It is your local municipality and county that set the tax rate.
Your ultimate tax bill is a reflection of the level of service your municipality provides, as well as the amenities available to you. MPAC simply tries to assess property values similarly and equally, so that taxes are spread evenly to all.
Whether the taxes you pay are fair, or too high, is an entirely different argument, and should not be associated with your market assessment.
Any appeals of your assessment must be filed with MPAC by March 31st.
If you have any questions or have topics you’d like to discuss please contact me [email protected] or 519-383-2566.
Mario Fazio has been a local real estate broker since 1977.