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About property assessment

About property assessment

BC Assessment is a provincial Crown corporation that classifies and values all real property in British Columbia. Each year, BC Assessment sends property owners a Property Assessment Notice telling them the fair market value of their property as of the uniform valuation date of July 1 in the prior year.

An assessment is the determination of a property's market value, classification and applicable exemptions each year. In early January, property owners receive a BC Assessment Property Assessment Notice showing the property's value, class and applicable exemptions. This assessment is the basis used by taxing authorities for determining the share of municipal and provincial property taxes owners will pay. 

Key questions about property assessment: 

Why is the Assessment Notice mailed six months after the July 1 market value date?

BC Assessment's professional appraisers must review close to two million properties every year and this six month period provides staff with the time they require to ensure the annual assessment roll is as fair and accurate as possible. Appraisers must analyze real estate transactions which can occur before and after the July 1 valuation date.

In the fall, appraisers also inspect new construction and development, verify the physical condition of each property as of the end of October and verify ownership through the Land Title and Survey Authority by November 30. Once this information is collected, appraisers complete the final assessment roll in early December. This work is audited for quality assurance and then notices are printed and mailed to all property owners on December 31 as required by the Assessment Act.

What is market value?

Market value for assessment purposes in British Columbia is the most probable price of a property in an open market between a willing purchaser and seller.

How is an assessment of property made?

BC Assessment has a professional appraisal staff and an extensive database that is periodically updated with information gathered through appraisal inspections. Municipal and provincial agencies inform BC Assessment of land title changes, building permit approvals and zoning adjustments. BC Assessment also considers a property's unique characteristics, including location, size, layout, shape, age, finish, quality, carports, garages, sundecks and condition of buildings.

What is the relationship between property assessment and taxes?

Provincial and municipal governments (taxing authorities) pay for public services through property taxes, which are based on assessed value. BC Assessment determines the market value of properties and sends property owners a Property Assessment Notice. Then, tax authorities determine the property tax rate they will set to raise the revenue needed to pay for public services. The tax authorities apply this rate to the assessed value of properties and send property owners a Tax Notice.

Why did the value of my property change?

Property values usually change as a result of real estate market forces and these forces vary by property type and location. If a property was upgraded, the value will likely increase.

What is the difference between our Valuation Date and Physical Condition Date? 

BC Assessment uses two dates when assessing properties, which can be confusing. Property owners with new construction, renovations, damage or permitted use changes can better understand how BC assessment handles these situations by reading the explanations below.

July 1st Valuation Date: The Assessment Act directs BC Assessment to estimate the market value of all properties in B.C. as of July 1st each year.

Market value is defined as "the most probable price, as of a specified date, in cash, or in terms equivalent to cash, or other precisely revealed terms, for which the specified property rights should sell after reasonable exposure in a competitive market under all conditions requisite to a fair sale, with the buyer and seller each acting prudently and knowledgeably, and for self-interest, assuming neither is under undue duress.”[1]

When evaluating sales to determine the assessed value of a property, changing market conditions between the sale date and the July 1st valuation date are typically considered.

In an increasing market leading up to July 1st, a property would often sell for more on July 1st than if it sold earlier. In this example, for analysis purposes the earlier sale price may be increased to make it more comparable to the market on July 1st. Similarly, if the market continued to increase after July 1st, sales occurring after could have their sale prices decreased to be more comparable to the conditions on the valuation date.

October 31st - Physical Condition and Permitted Use: The Assessment Act also directs our appraisal staff to consider the Physical Condition and Permitted Use of property on October 31st. Properties with new construction, renovations, damage or permitted use changes are reviewed as of October 31st to determine their physical state. Below is an example of the interaction between the Valuation and Physical Condition dates for a residential property:

Example Situation – Physical Condition
A property with a 1920’s home on it sold on June 15th. The home was demolished on August 10th and construction of a new home commenced. By October 31st the house was 25% complete.
Although the old house existed on July 1st (valuation date), by October 31st it had been replaced by a partially complete new house. In this situation the new property assessment will reflect the value of the new partially complete home.

Example Situation – Permitted Use
On or before October 31st the permitted use of a property changes, for example the zoning changes from residential to commercial. In this scenario, the change will be considered to determine if there is an impact on the valuation and/or property classification for the upcoming property assessment.

[1] Market Value - Appraisal Institute of Canada Third Canadian Edition