Appraisal vs Assessment
Q - Does my property assessment reflect the value of my home?
A - Your property assessment is utilized to calculate your property taxes. It should not be used as an indicator of property values.
Depending on the province, assessments reflect various time periods. In British Columbia, property assessments reflect prices as of July 1st of the previous year. Also, year-to-year adjustments are based on a formula and not by property inspections. In Ontario, for instance, they use the same base year to calculate taxes for four consecutive years.
The market is dynamic and moves at various speeds depending on economic conditions. A property assessment is static and used for different lengths of time and, therefore, is not a good measure of property value.
A property appraisal, on the other hand, is done by actually inspecting the property. The appraiser examines the property in the context of the market and places a value on that specific property. The appraised value is only valid for that point in time. The older the appraisal, the less accurate it becomes because the market is dynamic in nature. A year-old appraisal no longer reflects the true value of a property. In a very fast moving market, a two-month appraisal may also be inaccurate.
For residential properties, real estate agents are able to do a Comparative Market Analysis to arrive at a selling price that would be competitive in the market place. For a more in depth analysis of your property, a professional appraisal can be enlisted.