Appraisal Value vs Assessment Value in Kamloops

I am frequently asked from home owners (as well as some buyers) what is the difference between an appraisal and the assessment value of a property?

The two are completely different and are used for different reasons. They have no correlation to each other at the current time. KAMLOOPS 2017 Property Tax Estimator

Assessment Value

What is Property Assessment?

Property assessment for taxation purposes and its administration is a complex and technical process that is vital to the financial health of local government. Property Assessment is the process of establishing a dollar value for property for property tax purposes. Property tax is an “ad valorem” tax based on the principle that the amount of tax paid should depend on the value of the property owned. Although income and sales taxes are the main sources of revenue for the provincial and federal governments, property tax remains the major source of local government revenue. Generated from within the community, property tax helps to finance such local government services as garbage collection, water and sewer, parks and leisure and fire protection. Assessed values of properties for tax purposes must be accurate so that the tax burden will be distributed fairly and the public will have confidence in the Municipal Council and the local tax administration.

The municipality you live in will have an assessed value on your home. This value is how they calculate your annual property tax. Assessment figures however, are nothing more than a gauge or price line guide for a city or town to collect an appropriate amount of taxes from those that reside in the community. The official nature of this may encourage you to rely on the assessed value of your home for pricing purposes, which could be a big mistake. Real Estate assessed value almost always has no correlation to current market value. One of the biggest problems with the assessed value is that it is often not current. Municipalities will usually assess value once every 1-3 years. The market can change substantially during this time frame.  VERY rarely is your property assessment value over the appraisal or market value.  If it is, there are measures you can take for a re-assessment of your home.

Kamloops Property Tax Information Page

Appraisal Value

An appraisal is a method of valuation that compares similar properties in a similar area usually within a shortened time frame.  This is similar to a REALTORS® Comparative Market Evaluation (CMA) but not as in-depth. While both are using essentially the same information, they can vary depending on the property, location and appraiser/REALTOR®.  Sellers can be very fixed on this figure, especially when it benefits them.  (think refinancing) The problem with a high appraisal value is that it can be an unreliable means of what the value really is today’s market. Nothing worse then over pricing your home to list.  Just because you have listed your home with the an appraisal in place or not, true market value is what a buyer is willing to give and a seller is willing to accept.

Call Danielle today to schedule a free no obligation home comparable market analysis for your home (250).319.5896

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