Calgarians will soon be getting their property assessments in the mail following the city’s usual assessment process. But like many things in the city, the coronavirus pandemic has left its mark on property values.
“After months of analyzing sales and market data, we placed preliminary values on over 550,000 properties in Calgary,” Eddie Lee, City of Calgary acting director and city assessor, said Thursday.
Those preliminary values are refined through consultations with non-residential and multi-residential property owners and tax agents.
Across the city, property values dropped from $301 billion to $297 billion.
Residential properties across the city saw a two per cent drop. Single residences saw that same drop and residential condo values saw double that decline in value. Only multi-residential buildings saw a slight increase in value.
Thousands of Northeast homes still in disrepair
The city’s assessment period took place between July and December 2020, and followed the June 13 hailstorm that resulted in $1.4 billion in property damage.
The city inspected 32,000 homes and assessors found over 7,500 homes were still damaged as of Dec. 31, 2020 — the city’s “physical condition date” for 2021 property taxes.
Lee said those still-damaged properties account for nearly $100 million in lost value in 2021.
Khalil Karbani is a homeowner in Taradale and his home suffered $40,000 in damage during that storm.
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Repairs to his roof and indoor damage are complete, but stucco work still needs to be done, work that isn’t expected until the spring.
News of a lowered assessed value is bittersweet for Karbani after having to pay $9,000 out of pocket for his insurance process.
“I appreciate what the city has done by reducing our property assessments, meaning we will be paying less in property taxes,” Karbani told Global News. “Having said that, it does lower the value of our home.”
“We haven’t seen our properties appreciate for a number of years. With this hailstorm, it’s probably going to be a further reduction.”
Calgary Mayor Naheed Nenshi said this is an example of “the system looking after people in the right way.”
“The good news is those lower property values will result in lower property taxes,” Nenshi said Thursday. “In one weird way, this assessment taxation system that I dislike so much is actually doing what it’s supposed to do, which is recognizing if people are having that kind of hardship.”
Property owners can dispute assessed values with the city until March 23. Tax bills are due to be mailed in May, with municipal property taxes due in full by June 30.
Owners can get an idea of what that tax bill could be using the online property tax calculator.
By the numbers
The median value of single residences went from $455,000 to $445,000 between 2020 and 2021. However, thanks to Calgary city council’s budget decision in November, municipal property taxes will remain the same.
Non-residential properties saw a six per cent drop in values, with office space leading the way with a 13 per cent hit. Downtown offices experienced a 15 per cent decline in value over the past year, according to the city’s assessment department.
“Last year’s taxable downtown office space was about $10.7 billion,” Lee said. “This year, we’re seeing that at about $9.3 billion.
“In terms of downtown vacancy, we are seeing a head lease vacancy rate of about 21 per cent, with an additional sublease vacancy rate of about six percent.”
“It says exactly what you think it says, which is that we are still in a real economic dip here, that our fragile economic recovery that we were undertaking prior to COVID(-19) has obviously stalled and reversed,” the mayor said. “And our number one job needs to be for economic growth post-pandemic.”
Nenshi said he didn’t see much evidence of workers never returning to downtown offices once the pandemic is over.
“I’m seeing a lot of employers saying, ‘Actually we liked having people, having those spontaneous interactions, working together.’
“I suspect that the long-range impact of COVID(-19) on office space will not be as big as some of the earlier predictions,” the mayor said. “I also suspect that as a result of that, we will see a return to normal levels of transit ridership in the medium term, over the next few years.”
Only industrial properties as a class saw an increase in value, increasing four by per cent.
The city said 97 per cent of residential properties and 64 per cent of non-residential properties will see their property taxes stay within 10 per cent of last year’s bill.
Lee said approximately 1,000 properties would see a property tax increase of above 20 per cent, adding the caveat that the properties may have seen increased valuations because of construction or renovations.
City council approved to repeat the non-residential Phased Tax Program (PTP) for 2021, allowing some businesses to have their property tax increases capped at 10 per cent. The program is expected to cost the city $21 million and details on this year’s PTP will be released in February.
–with files from Tomasia Da Silva, Global News
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