Tuesday, October 6, 2009

Municipal Assessment Roll

We just received the new municipal assessment roll for our house, and the value is going up from $126K to $153K. That's a 21% increase and a bit less than I expected (apparently the average for Quebec City is about 30%).

An increase in the value of our house is both good and bad. In the short term, it is bad since it means we will be paying more taxes every year (it remains to be seen how much -- we will only know in January).

In the long term, it is good, since it means that our house is worth more. The day we sell (even though that's far in the future), we will recover the money we spent to buy it and some more. The important thing here is that the value of our house should at least keep up with inflation, so that we don't end up with less purchasing power.

But overall, this revision of the assessment is neither good nor bad news.

It will, however, have a fairly big impact on my net worth, since the value of my part of the house has just gone up by a few thousand dollars. Only half of the increase will be reflected in my net worth, since I use the average between the municipal assessment and my insurer's rebuild cost to determine the value of the house.

Still, that means an $8K increase to my net worth. Based on my latest estimates, this should be enough to push my net worth over the $100K milestone. Nice!


Jerry Hung said...

In short, you always want it LOW so you pay lower taxes

Selling price has nothing to do with assessment value most of the time, so higher assessment only means "make yourself feel good" :)

Higher assessment (i.e. higher taxes) have driven people out of their own homes because they couldn't afford it anymore

Good for you though, 26% gain

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