Glossary of Terms
Last updated on October 11, 2022Actual value
Actual value, or market value, is the most probable price at which a property would sell in a competitive market, if listed long enough to become generally known to real estate agents and prospective purchasers. It assumes that both the buyer and seller are willing (i.e., it is not a forced sale) and that both parties are prudent and knowledgeable.
Appraisal
An appraisal is the orderly and concise method of estimating value. The three common approaches are the Direct Comparison or Market Approach, the Cost Approach, and the Income Approach. An appraiser may rely on all three, although the Direct or Market Comparison Approach is most often used for residential properties. The Cost Approach is often used for new construction, and the Income Approach is appropriate for income-producing properties like apartment buildings, office buildings and shopping centres.
Appraiser
An appraiser is the person who prepares an appraisal. In British Columbia, there are no legislated standards for real property appraisers. However, most professional appraisers have some form of provincial, national or international accreditation. Persons who present themselves as an appraiser will have to establish professional expertise for the Property Assessment Appeal Board to accept them as an expert in appraisal matters.
Assessor
An assessor is a local representative of the British Columbia Assessment Authority (or BC Assessment). Each assessment area in British Columbia has an assessor responsible for preparing its assessments. The assessor is a party (usually a respondent) to all appeals within his or her assessment area.
Classification
The classification of property is based on its actual or potential use. For assessment purposes, it is generally based on the actual use as of October 31 of the previous year. The tax rate applied to a property varies depending on the classification. The assessed value of mixed-use properties may be split among more than one class. For example, part of the assessed value may be assigned to Class 6 - Business and Other, while the remainder is assigned to Class 1 - Residential. Descriptions of the individual property classifications can be found on the BC Assessment website at bcassessment.ca.
Comparable sales
A comparable sale is the sale of a property physically similar to the property under appeal, close in location, and selling close to the valuation date. If there are no sales close in physical characteristics, location or time, comparable sales of dissimilar properties may be adjusted to estimate the actual value of the subject property. Appraisers use comparable sales when estimating value using the Direct Comparison or Market Approach.
Folio & roll number
This is the number assigned to a property for assessment administrative purposes. It is normally printed in the top-right corner of your Assessment Notice. Most property taxation jurisdictions also use this number on tax notices. For most properties, one roll number is used for each specific property. It is possible, however, that one property is comprised of several roll numbers, or one roll number can cover several properties.
Land and improvements Land,
for assessment purposes, includes the normal definition of land, plus land covered by water. Improvements, for assessment purposes, generally mean any buildings, fixtures or structures placed on land or water over land. The Assessment Act requires the total assessed value be split between land and improvements. The total is arrived at from market evidence, and the allocation is based on the sales of similar but vacant lots. Any difference is assumed to be a result of the contributory value of the improvements. It is possible for the improvement value to increase one year over another even if it has not been altered or renovated, since it is the contributory value of the improvements to the total property value that is estimated. Usually, the allocation between land and improvements does not affect the amount of taxes paid for a single-family residential property. Therefore, changing the allocation will not usually change the amount of taxes payable.
Market value
Roll Number
Valuation date
Section 18(1) of the Assessment Act requires that properties are assessed at actual or market value as of July 1 of the year during which the assessment roll is completed. For the 2023 roll, the valuation date was July 1, 2022