It is that time of year once again, when property assessment notices start arriving from the City of Edmonton. Every year, this sparks questions from clients, so I thought I’d share some information for you.
The City of Edmonton, and really, any municipality use a formula for calculating your property value. A lot of it is based on your recorded square footage, permits you’ve pulled and also how the neighborhood in general is being treated regarding special upgrades or zoning changes.
Most importantly, this means these property assessments mean NOTHING when it comes to determining your actual house value on the market if you were to sell it today.
How Your Property Assessment is Calculated
You see, the City of Edmonton doesn’t know that you upgraded the countertops in the kitchen to granite, or that you painted over the vintage wall paper in the basement. They don’t know that your windows and mechanicals were fully outfitted to the newest energy ratings. They certainly don’t know if you’d let the inside go to ruin like an episode of hoarders. They only know what permits you’ve pulled and what upgrades you’ve completed that are indicated in those permits.
They simply look that for a house of your square footage (regardless of condition), size of lot, and improvements being made to the neighborhood, this is your home value estimation for property taxes only. Every year, the City of Edmonton decides on an increase or decrease percentage, and applies that to the base value of your home – and that’s how they create the cost of your property taxes for the year.
I have had clients who have a home valued much more than the property assessment value, and I’ve had clients with a home valued much less that property assessment value. But as a real estate agent, I don’t really give much credit to the numbers on your property assessment when calculating your home value for selling.
City of Edmonton property taxes need to be paid by June 30 each year unless you are on a monthly payment plan. If you sell your home between now and June, your lawyers will calculate any taxes you’ve paid or owe and pro-rate them based on possession dates. Always best to keep this in mind as it can affect your closing costs if you do sell this year.
How Your Home Market Value is Calculated
When looking at your property value, it is an estimate based on the home AND the market behaviours in your neighborhood at that moment in time. Some of the things I look at to determine your value include:
- Overall condition of the home, and landscaping
- Age and energy efficiency of your mechanicals (furnace, hot water tank, electrical systems, etc)
- Location (busy street, back onto a ravine, near schools, etc)
- Upgrades and renovations you have done to the home (new windows, flooring, painting, new shingles, appliances updated, etc)
- What do you have that is superior to other homes in the neighborhood (ie. are you the only 3 car garage)
- What do you have that is inferior to other homes in the neighborhood (ie. you don’t have a garage but most homes in the neighborhood do)
- Recently sold homes and how they compare to your home – as these were prices people were willing to pay in your neighborhood
As you receive your City of Edmonton Property Value Notice, don’t panic if it doesn’t match up to the market value of your home. At the end of day, it is only used for calculating your property taxes.
PS. If you are curious about your actual market value, whether you are curious or planning to move, feel free to contact me to for a complimentary home review. Many of my clients get a home review done every year or two just so they can keep track of the value of their home investment. It’s kind of like reviewing your investment statement, so you can ensure you know it’s real current worth.
