One of the most thrown around stats on a property is the assessed value. For those that don't know, the assessed value of a property is the value given by BC Assessment to a property to determine the basis for property taxation in our Province. In other word, they give each property a dollar value in order to decide who pays more tax.
Assessed value should not be confused with Market Value. Market value is the amount in which a willing Buyer pays for a property. As soon as somebody purchases a property (assuming it has had sufficient time on the market), they have established the market value for that property, as well as to a lesser extent other similar properties. Market Value is established by many people coming through a specific property and deciding how much they would pay to live there. Market Value takes into account the area, exterior, interior, as well as many other factors to determine price.
Although we cannot say 100% what the formula is for defining an assessed value (only people working at BC Assessment know), we do know that it is rarely an indicator of Market Value. Here are some resons why the differ:
1. Assessors for BC Assessment do not go inside your property, so how can they accurately obtain the value of your home? We can all agree that the inside of your condo/house is just as important as the outside.
2. Assessed values can be challenged by property owners and changed. If it can be changed, then it's not an accurate representation of Market Value.
3. Assessed value is determined once a year. A lot can change in a year.
You will evidently see a lot of properties listed that advertise a price "Below Assessed Value." As a Buyer, you should worry more about finding a property below Market Value, and having a Realtor help you is one way to do just that.
If you have any questions or would like to determine Market Value on your property contact us for a free evaluation.