Actual value vs tax assessment of your home and real estate
In the past few weeks I ran into a few buyers that were not willing to pay above the property tax assessed value on the tax report. Reason? They all seem to be under the impression that tax assessed value equals what the price of the property should be .
It’s because of this misconception that some listing agents write things such as “priced under assessed value” etc in their marketing remarks, and in turn, partially because of those marketing remarks properties priced under assessed value have been deemed good deals. This is not necessarily true . The Vancouver real estate market is a perfect example of this.
ASSESSED VALUE is a valuation placed on property by a public tax assessor (in BC it’s a provincial crown corporation called Vancouver BC real estate Assessment) for purposes of taxation. Tax authorities, for example the City of Vancouver, then applies their own tax rates to the assessments provided.
According to REMAX Vancouver FAIR MARKET VALUE is the price that a knowledgable, willing and unpressured buyer is willing to pay to an seller who is willing and is under no pressure to let go of their property. Prior to listing a property , the listing agent typically will pull up comparable homes that sold in the last few months , depending on what they find . They then guide the seller as to what is the value of their property . The agreed upon price between a buyer and seller effectively becomes the fair market value of that property. This is also it is important to bring a few similar sold listings prior to making an offer; it’s a great way to determine whether the subject property is priced accurately.