BC Assessment, the Crown Corporation responsible for providing municipalities with property assessments in BC, recently released their 2015 assessments and will be mailing them out this week to households.
Households in the Greater Vancouver Area will see large increases in their assessed value. This is especially true for owners of a single-detached home in the city of Vancouver, which have seen assessed value increases of 15%-25% since last year.
The effect is not isolated to Vancouver though, with sizable increases in Burnaby, New Westminster, North Vancouver, West Vancouver…. well, everywhere really.
Don’t worry though because, as we said in October this will not lead to a commensurate rise in property taxes.
We say this with confidence because municipalities in Canada are required to operate with balanced operating budgets.
So, if they expect their operating expenses (not including capital investments) to increase by 5%, they must raise their expected revenue (inclusive of property taxes and numerous fees) by 5% – no more, no less.
This means that, if property values rise by 15%, the property tax rates must fall by around 9%.
The above back-of-the-napkin calculation makes a number of assumptions and ignores a few things for simplicity’s sake.
The thrust of this article is that your property taxes will not rise by nearly as much as your assessed value.