Province’s assessments increase by 16 per cent to top $940 billion
Derrick Penner
Sun
Another record year of construction and continued high demand for property in 2007 pumped up the assessed value of B.C.’s real estate by 16 per cent to top $940 billion, the B.C. Assessment Authority says.
BC Assessment mailed out property assessments to property owners Dec. 31, and on Wednesday released several reports on property values around the province.
BC Assessment said new construction accounted for some $21.6 billion of the increase, and the authority added 36,905 properties to B.C.’s property rolls, which now total 1.82 million addresses.
That means most of the increase in provincial property values, some $110 billion, represents inflation in real estate markets that have risen for the last seven years.
“Obviously we’ve had strong economic growth so we continue to see fairly strong growth in pretty well all aspects of real estate markets across the province,” Mark Katz, area assessor for the South Fraser region in the Lower Mainland, said Wednesday.
Across the Lower Mainland, Katz said property assessment increases in the range of 10 to 20 per cent were not uncommon.
He added that average assessment increases can sometimes be misleading because they don’t capture the range of property values across a market. He said averages do “generally give you a good idea of what the trends are.”
And in the Lower Mainland, construction of the Canada Line rapid-transit system has had a significant impact on commercial property values, Katz said.
BC Assessment estimates property values based on market values as of July 1 every year.
While assessments don’t necessarily capture current market values, they are indicative of what the hot markets have been over the past year.
B.C.’s 2008 property rolls revealed that rising real estate values have turned 11,702 new British Columbians into property millionaires.
Assessments also revealed that rural playgrounds of the Kootenays are seeing some of the biggest increases in property values, with the rural area around the tiny village of Nakusp leading the way.
Nakusp, on the shores of Upper Arrow Lake north of Nelson, saw the value of its 2008 property roll increase 53 per cent from the previous year to reach $924.6 million.
That rise wasn’t surprising to Cameron Muir, chief economist for the B.C. Real Estate Association. He said there has been a growing trend of Albertans, and retirement-oriented buyers gravitating toward the Kootenays and Okanagan.
“They tend to be a little bit more flush with cash because they’re pulling equity out of their homes,” he said.
Jim Norton, BC Assessment’s area assessor in Cranbrook, said Alberta buyers have been flocking to the golf courses, ski hills and other recreational amenities of the east Kootenays for some time. He said that around Radium Hot Springs and Invermere, up to 70 per cent of properties are now owned by Albertans.
“Now, because [the east Kootenays] are getting so pricey, they’re going further afield,” Norton added.
Dennis Hickson, deputy assessor for the Nelson/Trail region, added that the increase in assessments for rural Nakusp and other communities perhaps look more dramatic than they are because property values have been very low relative to other Kootenay communities.
Hickson pointed to one example, a waterfront house on Upper Arrow lake, which was assessed at $479,000 for 2008 versus $268,000 in 2007. However, in August, the property sold for $549,000.
In another case, a house on five acres upland from Upper Arrow Lake was assessed at $213,000 for the 2008 roll, up substantially from $141,000 in 2007. It sold for $240,000 in November.
“There’s a lot of catch-up going on in the entirety of the west Kootenays,” Hickson said.
Those relatively low values, he added, are proving attractive to Albertans.
“Now, I think they are willing to drive an extra hour or so,” Hickson said.
However, for Nakusp, an area suffering through the forest industry’s downturn, rising property values are still a dislocating element, says Paul Peterson, director of the Regional District of Central Kootenay that represents the area.
“People are buying [property in Nakusp] as a second, third and sometimes even fourth home, and they don’t rent them out,” Peterson said.
That makes it difficult for the people who typically rent, and is “devastating” for low-income residents of the region, forcing them out.
“A lot of good people just don’t happen to have a lot of money, and they’re getting left out in no man’s land,” Peterson said.
© The Vancouver Sun 2008
