You've decided to sell your home. To attract buyers and to ensure you receive a fair price, you and your Realtor will want to establish your home's value. To do this, sellers often start with their Property Assessment Notice. Your Realtor will also be able to provide you with an estimate of value based on comparable recent sales and current homes for sale. What is surprising to many sellers is that there is often a difference between the assessment value and the actual value determined by your Realtor.
What Accounts for this Difference?
BC Assessment (BCA), a government Crown Corporation, is responsible for sending every property owner a Property Assessment Notice each January. The notice contains BCA's estimate of the market value of the property as of the previous July 1st. The purpose of the information is to create the Assessment Roll, which is used by local governments to levy property taxes.
To assess the market value of properties, BCA uses what is known as a "mass appraisal system." This allows BCA to value all properties in a cost-effective and efficient manner. BCA's database has information on 1.6 million properties. When a new property is created through zoning, construction or an existing property changes, a BCA appraiser visits the site and looks at the lot size, the structure and other factors.
To update market values, BCA appraisers do not visit every property each year. Instead, a mass appraisal system allows them to look at prices for homes sold in each neighbourhood and apply the information to their evaluation of all properties in that neighbourhood. With this in mind, there could be several reasons to explain the difference between BCA's assessed value of your Property and the current value reported by your Realtor.
Here are 3 possibilities to consider:
BCA's estimate is current as of July 1st of the preceding year; however, the value your Realtor places on your property is current as of today's date, resulting in a more up-to-date estimate.
Your Realtor scrutinizes the most recent comparable data for homes recently sold in your neighbourhood to determine the current trend of housing prices, while taking into consideration the state of the economy. An improving economy is often indicative of rising prices, whereas a declining economy can result in a fall in housing prices.
Your Realtor examines the exterior and interior of your property in detail, noting any alterations made to your property since the assessment that could affect the value of your home.