PROPERTY ASSESSMENT APPEAL BOARD

PREPARING SUBMISSIONS ON THE MARKET VALUE OF YOUR PROPERTY

This section provides you with assistance in preparing submissions if you believe your property assessment is not at its market value (too high or too low). You will need to provide evidence and analysis to establish your property’s market value. You may wish to hire a professional appraiser, who has education and experience in this field. Alternatively, you should be able to prepare a reasonable analysis by applying a combination of market research, common sense, and a logical approach.

Step 1: Find Comparable Sales Data

The best evidence of the market value of your property would be if your property sold on the Valuation Date. Since that is highly unlikely, you should look for sales of other properties that are similar to yours in attributes such as size, age, and location, and sold as close to the July 1st valuation date as possible. There are two common ways to find sales data:

  • BC Assessment’s website e-valueBC has property sales from your area from January 1st to October 31st of the previous year. You can also view this information at your local BC Assessment office;
  • a real estate salesperson/broker can help by doing a search of the Multiple Listing Service (MLS) database by date of sale, neighbourhood, and attributes.

You should ideally have some sales comparables that are superior in quality to your property and some that are inferior. This is known as "bracketing" your property because it sets an upper and lower limit of your property's market value. In the next step, you will determine where your property's market value falls within this range.

If you cannot find adequate sales, you could provide listings for similar properties. However, please be aware that listings are usually considered less reliable than actual sales. Listings may only illustrate the upper end of value and do not provide a solid indication of market value.

You may want to take photographs of the outside of the sale properties and mark their locations on a map of the area, to show their location relative to your property.

Step 2: Prepare a Property Comparison Chart

Typically you use a comparison chart to explain the condition and attributes of your property, and then show how each comparable property is similar and how it differs. You then make adjustments to the comparable’s sale price to account for the influence of these dissimilar features.

  1. Time Adjustments: In a rising or falling market, you may need to account for market changes between a property’s sale date and July 1st. For example, if a property sold March 1st before the Valuation Date, you need to account for 4 months worth of market movement. Preferably you should include some justification or evidence on how the time adjustment was arrived at. For more details see Time Adjustment Methodology.

  2. Attribute Adjustments: You must account for attributes or characteristics of the sold properties that are different from yours. Think of the “big picture” aspects buyers consider when shopping for real estate, and de-emphasize the rest – too much detail will not help your case. For example, you might consider some or all of: location, lot size, house size, view, waterfront, number of bedrooms/bathrooms, condition, quality of finish, garage. Please note that your analysis may consider all, some, or different attributes than those listed in the comparison charts and samples.

    See Adjustment Methodology for two options on how to adjust for the attributes.

  3. Reconciliation: Use the adjusted sale prices to indicate a range of values for your property and explain where you place your property in this range. Given this range and where your property falls in it, what is your best estimate of your property’s market value on July 1st?

Click on the following box for: Tips on Value-Based Submissions

Time Adjustment Methodology

You should research whether or not you need to make a time adjustment. Look for an indication of how prices changed between July 1st last year and the date of the sale. If you know when the Interim Agreement was signed, this is the most accurate date to use.

You can find local market statistics at your local real estate board: see contacts for real estate boards. You can also request this information from your local BC Assessment office (although they may not be able to provide this to you).

If you find an indication of price changes between July 1st last year and the sale date, or close to it, then your analysis may already be done for you. For example, if the property sold on December 29, 2012 and the report shows a 6-month change of -2%, that will indicate that you should adjust the sale price for time by +2%.

Some reports show monthly benchmarks values. You can use the difference between the June or July value and the report value closest to the sale date to find the adjustment. For example, assume the property sold on October 15, 2012. If the June 2012 benchmark value is $421,000 and the October 2012 benchmark value is $406,000, the difference is -$15,000. The average change is $15,000/$421,000 or -3.6%. You would need to time adjust the October sale by +3.6%.

Some reports show a Housing Price Index (HPI), which is similar to the benchmarks values. For example, if the June 2012 HPI is 133.7 and the October 2012 HPI is 128.9, the difference is -4.8 and the average change is 4.8/133.7 or -3.6%. You would adjust an October sale by +3.6%

Adjustment Methodology

Making adjustments is typically the most difficult aspect of appraisal. There are two methods:

Method 1 Qualitative Adjustments: You may adjust for differences qualitatively: meaning subjectively rating the quality of each sold property’s attributes in comparison to your property. You can rate the attributes with descriptive words such as “similar”, “inferior” and “superior. This is illustrated in the sample qualitative comparison chart.

  • Ensure you provide explanations for your ratings!
  • For time adjustments, it is preferable to adjust for time quantitatively (see Time Adjustment Methodology). Alternatively, you can account for market changes over time qualitatively using your descriptive word ratings, but this is less precise.


  • For example: if the sale comparable sold 6 months before July 1 in a declining market, you could rate it qualitatively by saying it is “superior” to your property. This is less precise than quantitatively calculating the difference due to time, such as: "The market has been declining 1% per month over the last 6 months, so the comparable's sale price must be adjusted downward by 6%".

Method 2 Quantitative Adjustments: You may adjust for differences quantitatively or numerically: meaning adding and subtracting dollar amounts or percentages to account for differences. This is illustrated in the sample quantitative comparison chart.

  • If the sold property is inferior to yours, you add to its sale price. If the sold property is superior to yours, you subtract from its sale price (you can remember this with the acronym IASS: Inferior = Add; Superior = Subtract).
  • You must provide an explanation or rationale for why you made your adjustments, why you chose to add or subtract value for a given feature, and why you chose the relative size of adjustments, e.g., why you chose to adjust $1,000 versus $20,000.

Notes:

  1. Homeowners may find Method 1 Qualitative Adjustments easier than Method 2.
  2. Include any support you have for your adjustments (such as statistics for time adjustments, etc).

Charts and Examples: To go to the charts click on:

Proceed to Next Step