In order to update the information used for municipal and school taxation purposes, every three years the city of Montreal and it’s 16 municipalities table a new assessment roll. The assessment roll considers a variety of information regarding all properties within the municipality in order to establish “property values”. According to the city of Montreal website the property assessment roll “…represents the inventory of all properties and their actual values at a specific point in time…”. The most recent assessment rolls for the years 2020-2021-2020 will come into effect as of January 1, 2020.
What is the “actual value” and how is it calculated?
If we refer to the city of Montreal website, the municipal value which will appear on the 2020-2021-2022 assessment roll is the most probable sale price of a property that a buyer would pay in an open market (e.g. in a private sale) as of the date of July 1, 2018.The most probable sale price is determined by a city appraiser who uses comparable sales and real estate market conditions for the 18-month period prior to the assessment roll coming into force. Therefore, the next assessment roll provides an estimated value at a certain time, more precisely that of July 1st, 2018. We can safely say that going forward, the municipal value based on sales of July 1, 2018 does not provide the current or future market value of a given property, rather a portrait of a past value. Many buyers and sellers confuse the municipal evaluation that is provided by this assessment as the current “market value” of a property.
What is the municipal assessment value used for?
The assessment value is used to determine the municipal and school taxes according to a percentage or multiplier which the city has yet to determine. The exact amount and bills will be sent out early November of 2019.
Why are assessments different throughout the Island of Montreal?
As location is one of the factors used to determine value, when comparing sales data, it is very plausible to get different values form one borough to the next albeit for a similar property. It is normal to see that certain municipalities’ assessments increased at a higher rate than others. Again, all the values are calculated using the comparable sales method for single homes and provide an estimated sales price at a given time, that of July 1st, 2018.
How much have municipal assessments increased?
When comparing the 2020-2021-2022 assessment roll to that of 2017-2018-2019 for the Island of Montreal, there is an average increase in municipal evaluations of 13.7% for single homes. The highest increase in values amongst demerged cities of Montreal were Beaconsfield with a 29.5% increase and Hampstead with 23.6% followed by Town of Mont royal with a 23.1% increase. The demerged cities posting the lowest increase in values were found in Montreal East and Senneville with a 10.6% and 8.5% increase respectively. As for the boroughs of Montreal, Verdun and Sud Ouest had the highest increases in values with 19.8% and 17.1% increases. The lowest increases were in Montreal-Nord and Rivière des Prairies. Assessments of multi-family buildings of 6 units and more increase by 21.7% compared to the last roll.
Will my property taxes increase proportionally?
Let’s assume your property value increased by 15% and this is above the average increase for a similar type home in the same area, then you may expect to see a rise in your tax bill. The opposite an also occur, if your property value increase is lower than the average in your area for a similar type home, than your tax bill may decrease. The level of taxation will only be known once the city of Montreal adapts their budget for 2020. If you disagree with your new assessment roll, you have up until April 2020 to fill out a form and contest the value officially with the City of Montreal.
Helen Akrivos is a Montreal real estate expert who is passionate about educating and inspiring everyone to succeed in real estate! She holds a Chartered real estate broker license and is President of North East Realties agency in Montreal. As a lecturer in the Residential Real Estate Program at College Lasalle, Co-Host of “The Real Estate Show” on CJAD AM800 radio and contributor to the MTL Times newspaper, Helen shares her stories of real estate success to help as many people as possible! E-mail your comments to firstname.lastname@example.org