Real Estate Property Assessments Misunderstood – Vancouver BC Real Estate
Many lookers are operating under the misconception that a home’s purchase price needs to be just above its tax assessed value. In other words, they feel that tax assessed is the matching thing as “what a home is worth.” This is really not the case, but only this month I’ve met no less than three potential buyers who refused to offer anything higher than the tax assessment value on homes they truly loved.
To combat this, many agents have begun featuring phrasing like “priced under assessed value” in their marketing materials for the home’s sale. It has not mattered. Instead, what’s happening is that buyers’ misunderstandings are seemingly validated and, thus, continued. Buyers see offered abodes as “good deals,” but in truth they are not. 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, it is differing from the FAIR MARKET PRICE. Fair market value is the price that a house can bring on the open market. This is the price that educated, motivated, and willing buyers will pay to procure the property from a seller who is selling of their own free will. Fair Market Value is determined by comparison to comparable properties which have sold in the previous three to six months. (If no comparable houses are available, the timetable may have to be extended.) Based on these homes’ asking prices–these are called “comps”–the agents counsel the seller on a achievable asking price. After a price is arranged between a buyer and seller, this becomes the fair market value of a particular property. Thus, it stands to reason that in advance of making an offer, a buyer should examine comps themselves to come to an understanding of what is reasonable and fair.
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