Isn’t the value of my building the Assessed Value that the City of Calgary assigns?

Feb 18, 2011 by

With the City of Calgary recently mailing assessment notices to real estate owners Calgary Industrial building values are top of mind right now.  I cant count the number of building owners who firmly believe that the City of Calgary is the determining factor on their building value.  Although a good indication of a range of values, the challenge is the “Market Assessment” model lags what is actually happening in the market.  A buildings value in February will be based on the City’s interpretation of market in June of the previous year which will generally be based on the relevant sales completed the 12 months prior to that.  During that 18 month span alot can happen.  We currently have a property being sold that had an assessment as at June 2010 of $6,050,000 and is going to transfer hands March 1st for $6,700,000.  In this case, good from a tax assessment standpoint but clearly not a good indication of market value for sale or valuation purposes.  On the flip side we have a client that had a recent appraisal completed by a very competent appraiser on a 27,000 square foot building at $3,000,000.  The City believes it is worth $3,190,000.   Not so good from a tax assessment standpoint, which should be appealed as a result.  The higher assessed value provided a false sense to the owner in this case and he was disappointed at the market appraisal when it came in $200,000 less.  Not sure what you building is assessed at?  Click here for the City of Calgary Assessment site.

 The moral of the story don’t rely on the City of Calgary Assessment department to determine the value of your building.  Contact the experts.  Get a formal appraisal or at minimum contact a competent real estate agent who specializes in your type of building to get an opinion of current market value.

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