Estimated market value and tax assessement value: the key difference

In the past 30 days, three different prospective buyers have indicated to me that they do not plan to pay a lot more than the tax value given to the property. Why is this? Let me attempt to answer this question as best as a Vancouver real estate agent could: People probably surmise that the amount that is assessed for tax reasons is the same as what the house is actually worth.

Since this mistake, real estate agents have started to include phrases like “price is below the assessed value” in their listings. We at REMAX Vancouver have not fallen to that schema althought I have seen a few… As a result of these statements, houses that are priced lower than the probable likely value are viewed as bargains. However, this might not always be accurate.

The assessed value of a home is an amount that is calculated by a tax official (British Columbia employs a provincial crown company known as Vancouver BC real estate Assessment) in order to calculate taxes. As soon as this assessment is figured out, the entity responsible for taxation, like the City of Vancouver, then sets its tax rates according to the assessment.

Fair market value represents the price that an intelligent, free-thinking, and sensible party would consider paying to the person who owns the property, who is not required to sell the house if he or she does not want to. Preceding putting a house up for sale, a real estate representative will track down several houses that are similar to that of the seller that have sold in the past few months. Calculating these comparisons, the representative shall then advise the owner on what the price of the house has to be. When a buyer and seller come to a purchase price, this decides the fair market value of the house. This illustrates the reasons why you want to compare similar houses’ selling prices before letting slip to the owner what you’ll pay. This will make sure you know that the house is priced in an even manner.

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