It’s that time of the year again – BC assessment notices will soon be arriving in the mail, and many homeowners will be wondering what their home is worth and what the difference between the assessed value, appraised value and market value is.
As a homeowner, you may already have an idea of what your property is worth. However, the difference between the three above mentioned values – Assessed Value, an Appraised Value and the Market Value may be causing some confusion.
What is the Assessed Value and what does BC Assessment do?
BC Assessment maintains real property assessments in compliance with the Assessment Act which requires that properties be assessed as of July 1st each year.
To do this, BC Assessment produces assessment information annually to provide tax authorities with a tax base and other information collected about the property. The main purpose of BC property assessment is for the government to determine how much municipal or provincial tax any given homeowner will pay for their ownership.
In providing an Assessed Value, BC Assessment considers a property’s trait such as the type of home, size, layout, age, condition, and location, along with recent sales in the local neighbourhood. However, as all homes in BC require assessing, the appraisal process is completed virtually, meaning they are unable to take into account things such as renovations, upgrades and maintenance.
It is also important to remember that the Assessed Value is based on the value from July 1st of the previous year. So, when your BC Assessment notice arrives in January 2021, the land value, building value and assessed value is based on the property’s value as of July 1st 2020.
What is Appraised Value?
When applying for a mortgage, the financing company will want to know the value of the property they are providing a loan for.
The home appraisal provides buyers with an up to date, the independent market value of the home-based on several factors including but not limited to the location of the property, age of the home and current condition. A home appraisal generally costs between $300-$400 and along with providing security to all parties involved, it is also used to satisfy mortgage requirements.
What is Market Value?
Simply put - the market value is the amount that a buyer is willing to pay to purchase your home.
This value is driven by the wider real estate market including supply and demand. The real estate market valuation also considers many of the same factors used by BC Assessment, and it’s very likely the market value is quite a bit different from the Assessed Value.
This is due to the factors mentioned above including BC Assessment’s figure is based on the value from July 1st of the previous year, while a real estate market appraisal can be done at any time. You may have also added a new kitchen or renovated the bathrooms, a new school may have been built nearby also increasing its value.
What is my home worth?
For an accurate valuation of your home, taking into account comparisons to other homes that have recently sold or are on the market in your neighbourhood, the demand for such property, recent upgrades and more, contact me today.