I often hear people mention or ask what the city assessment is for a particular property when they are either trying to value what their own house is worth or what a property should be priced or sold at when looking to purchase.
This assessed value is based on a number of variables such as the size of home, lot size, location of property in relation to roads and other amenities (lake front, backing on to park) or detracting factors (under an overpass, commercial adjacent). The city then uses this estimated value to decide what to charge you for property taxes. The more your property is valued at, the more you pay to the city.
The problem with using this value when deciding on what the market value of a home should be is that the city doesn't know much about what you have done to your home, or haven't done for that matter. You and your neighbour could have the exact same house on paper as far as the city is concerned, but your home could be fully renovated while your neighbour's house could be on the verge of falling over due to neglect. The city doesn't have the capability or resources available to fully examine every house inside and out so they use an average value based on surrounding properties.
One of the only ways the city can tell if you have done improvements to your home is by seeing that permits have been pulled for renovations. This notifies them that you are making changes to your home and will adjust your assessed value accordingly. However, the city only updates their assessment values every two years and since then you could have torn down a garage, gutted and remodeled your entire kitchen, added a pool, or finished your basement, so these two values can be way off as any of those changes would greatly affect the value of your home. On top of that, many people don't even pull the necessary permits when doing work to their house, either because they simply don't know you are supposed to, or to avoid paying more in property taxes. There are just far too many variables that aren't accounted for to use the city assessment as an indication of market value.
Just take a look at some samples of sales in the last month I pulled from different parts of the city to see that the market value and city assessed value are often very far off, both too high and too low.
St. Vital - Assessed Value = $336,000 Market Value = $315,000
St. Vital - Assessed Value = $448,000 Market Value = $475,000
River Heights - Assessed Value = $345,000 Market Value = $290,000
River Heights - Assessed Value = $504,000 Market Value = $650,000 That's $146,000 over city assessment!
North End - Assessed Value = $99,500 Market Value = $60,000
North End - Assessed Value = $83,200 Market Value = $118,000
If you would like to see the city assessment value for any property, you can head over to the City of Winnipeg website HERE. If you click on the property map tab once you enter your address you can get a bird's eye view of your property as well as the surrounding properties (as pictured below).
This also applies to rural properties outside of Winnipeg if you go to the Manitoba Municipal Government website HERE.
If you have any questions about the value of your home or one you are thinking about purchasing, don't hesitate to give me a call. I can pull up detailed sold data that you can't find any where else.
BONUS TIP! If you think your home is not assessed at a fair value, you can appeal it and potentially save money on your property taxes. I just wouldn't recommend appealing it if your house is worth more than the city think is it :)