Baulk v. MPAC, Region 13, 2014 CanLII 99203

Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: April 15, 2014

FILE NO.: WR 124056A

AMENDED DECISION ISSUED ON: February 23, 2016

Assessed Person(s): Alison Jennifer Baulk and Timothy Edmund Baulk

Appellant(s): Alison Jennifer Baulk and Timothy Edmund Baulk

Respondent(s): MPAC, Region 13

Respondent(s): Town of Whitby

Property Location(s): 102 Wycombe Street

Municipality(ies): Town of Whitby

Roll Number(s): 1809-010-041-00728-0000

Appeal Number(s): 2982744

Taxation Year(s): 2013

Hearing Event No. 552696

Legislative Authority: Section 40 of the Assessment Act, R.S.O. 1990, c. A.31, as amended

APPEARANCES:

Parties	Counsel+/Representative
A. J. Baulk and T. E. Baulk	A. J. Baulk and T. E. Baulk
MPAC	B. Ford
Town of Whitby	No one appeared

HEARING EVENT INFORMATION:

Hearing: Held in the Town of Whitby on February 10, 2014

DECISION OF THE BOARD DELIVERED BY MARILYN SHARMA

INTRODUCTION

1The subject property is known municipally as 102 Wycombe Street, Whitby, in the Regional Municipality of Durham. It is located in an area of new single family detached homes in the northern part of Whitby.

2The subject property is a single family two-storey detached home (not on water) on a site having an area of 7,842 square feet. The building on the property was constructed in 2011 and has a building area of 2,744 square feet with a basement area of 1,327 square feet and a two car attached garage. The building on the property was designated by the Municipal Property Assessment Corporation (“MPAC”) as being of a quality seven standard.

3The subject property has a five (5%) negative adjustment because of its proximity to a parking lot.

4The assessment of the subject property for the taxation year 2013 is $533,000.

5The appellant argues that MPAC has over-assessed his property and believes that the assessment is excessive in relation to similar properties in the neighbourhood

ISSUE

6The issue before the Board is to determine whether the subject property is assessed too high in relation to similar properties in the area.

DECISION

7The Board finds that the current value of the subject property is $524,104.

8The Board has made reference to similar lands in the vicinity and finds that no reduction is required for equity under s. 44.(3)(b) of the Act.

9The assessor indicated that an adjustment has been made in its system to reduce the assessment from $533,000 to $520,000 that took into account the addition of a pool and a negative 5% adjustment for abutting a commercial property. The Board similarly adjusts the assessment from $524,104 to $511,000 (rounded).

REASONS FOR DECISION

The Legislation

10For the 2012 taxation year, in determining the value at which land shall be assessed, the Board must have regard to the following provisions of the Assessment Act, R.S.O 1990, c.A.31, as amended (“Act”):

11Section 1 of the Act defines “current value” as:

“current value” means, in relation to land, the amount of money the fee simple, if unencumbered, would realize if sold at arm’s length by a willing seller to a willing buyer.

19.(1) Assessment based on current value. – The assessment of land shall be based on its current value.

12Section 19.2(1)2 of the Act states:

19.2(1) Valuation days. – Subject to subsection (5)¹, the day as of which land is valued for a taxation year is determined as follows:

2. For the period consisting of the four taxation years from 2009 to 2012, land is valued as of January 1, 2008.

13Section 44.(3) of the Act states:

44.(3) Same, 2009 and subsequent years. – For 2009 and subsequent taxation years, in determining the value at which any land shall be assessed, the Board shall,

(a) determine the current value of the land; and

(b) have reference to the value at which similar lands in the vicinity are assessed and adjust the assessment of the land to make it equitable with that of similar lands in the vicinity if such an adjustment would result in a reduction of the assessment of the land.

14Section 40.(17) of the Act states:

40.(17) Burden of proof. – For 2009 and subsequent taxation years, where value is a ground of appeal, the burden of proof as to the correctness of the current value of the land rests with the assessment corporation.

15Section 40.(19) of the Act states:

40.(19) Board to make determination. – After hearing the evidence and the submissions of the parties, the Board shall determine the matter.

Analysis

16Under the Act the Board is required to do three things:

(1) Find the current value of the property;

(2) Make reference to the value at which similar lands in the vicinity are assessed; and

(3) Adjust the assessment of the subject property if the adjustment would result in a reduction in the assessment.

(1) Current Value

17The best measure of current value is an arm’s length and market tested sale of the subject property on the valuation date of January 1, 2012, or close to it. If no such transaction took place, a further measure of current value is arm’s length and market tested sales of comparable properties in the same vicinity and market. This measure acts as a benchmark and gauge of the correctness of the assessed value of the subject property. The onus for establishing the correctness of the current value lies with MPAC.

MPAC’s Evidence

18MPAC provided five suggested comparable properties as shown in Table 1 below.

Table 1

MPAC’s Suggested Comparable Properties

Address	Site Area (Sq. Ft.)	Building Area (Sq. ft.)	Year Built	Current Value Assessment	Sale Date	Sale Price ($)	Sale Price per sq. ft.
102 Wycombe Street (Subject Property)	7,842.37	2,744	2011	533,000	n/a	n/a	n/a
31 Belhouse Place	4,080.81	2,880	2010	466,000	August 2011	491,000	$170
97 Holsted Road	4,068.00	2,880	2006	463,000	July 2011	484,900	$168
321 Cachet Boulevard	8,812.63	2,998	2010	518,000	May 2012	550,000	$183
2 Rockland Crescent	5,662.80	2,741	2008	463,000	July 2012	565,000	$206
15 Rockland Crescent	4,465.02	2,705	2009	448,000	July 2012	522,000	$193

19The assessor contends that the suggested comparable properties that he has submitted are comparable to the subject property because:

i. All are similar in building area;

ii. All the properties are located in the same homogeneous neighbourhood;

iii. All are of similar age;

iv. All are two-storey structures;

v. All have attached garages; and

20All five properties had sales that are valid open market transactions.

21Although the assessor indicated that in his view, the five suggested comparable properties are similar to the subject property he believes that the property situated at 2 Rockland Crescent is the most comparable to the subject property.

22The assessor advised the Board that MPAC has adjusted the assessment of the subject property in its data base to $520,000 to take into account the addition of a pool and a negative 5% adjustment for abutting a commercial property and that on the basis of his analysis and having considered the valid sale price of 2 Rockland Crescent he suggests that the subject property’s assessment is correct.

Appellant’s Evidence

23The appellant provided the Board with 15 suggested comparable properties as shown in Table 2:

Table 2

Address	Site Area (Sq. Ft.)	Building Area (Sq. ft.)	Year Built	Current Value Assessment	Sale Date	Sale Price ($)	Sale Price per sq. ft.
102 Wycombe (Subject Property)	7,842.37	2,744	2011	520,000
368 Carnwith	4,727.22	2,996	2005	462,000	Sep. 2009	418,000	$139.50
366 Carnwith	4,727.22	2,837	2005	452,000	Aug. 2012	432,523	$152.50
363 Carnwith	4,727.22	2,996	2006	472,000	Aug. 2012	499,900	$167.00
27 Rockland	4,797.76	2,913	2008	465,000	Apr. 2009	398,500	$137.00
22 Lamport	5,123.82	2,917	2007	507,000	Jan. 2011	540,000	$185.00
35 Rockland	4,797.76	2,913	2008	465,000	Jan. 2012	445,000	$153.00
87 Rockland	4,465.51	2,595	2007	433,000	Dec. 2011	465,000	$179.00
186 Cachet	4,696.00	2,862	2006	456,000	May 2011	402,000	$140.50
180 Cachet	4,621.00	2,837	2008	458,000	Jun. 2012	485,000	$171.00
182 Cachet	4,602.00	2,862	2006	455,000	Oct. 2009	388,000	$135.50
40 Rockland	4,343.39	2,882	2007	488,000	Jun. 2010	526,000	$182.50
177 Cachet	4,649.00	2,502	2006	431,000	n/a	n/a
42 Rockland	4,273.00	2,735	2008	475,000	Feb. 2010	409,900	$150.00
173 Cachet	4,580.00	2,460	2007	428,000	Aug. 2012	468,000	$190.00
321 Cachet	8,754.16	2,998	2010	518,000	May 2012	550,000	$183.50

24The appellant provided in Exhibit 3 a series of issues which formed the basis for objecting to the current value established by MPAC. These include the following:

i. Market increases;

ii. Price Changes over time;

iii. MPAC’s analysis;

iv. Sales inventory in the Brooklin area as at January 14, 2014 and Multiple Listing service (“MLS^®”);

v. My Neighbourhood Sales of suggested comparable properties; and

vi. Statistics pertaining to Sale Prices and Property Value Assessments in Durham

i. Market Increases

25The appellant presented information which she compiled pertaining to the sales of properties over the period 2011 and 2012 and the resulting market increase. Based on her analysis, she believes that MPAC is incorrect to confirm the assessment of the subject property at $520,000.

ii. Price Changes Over Time

26The appellant claims that when she applied the Price Change Over Time calculation used by MPAC, she arrives at a time adjusted sale price of $491,453.27. However, she further claims that when the November 2011 closing date is used, the time adjustment sale reaches $460,000 which is less than the assessment established by MPAC.

iii. MPAC’s Analysis

27The appellant had a variety of questions regarding MPAC’s analysis which principally centered on MPAC’s choice of comparable properties, MPAC’s equity analysis and discrepancies in MPAC’s information in comparison to that provided by her sales agent.

iv. Sales Inventory in the Brooklin area as at January 14, 2014 and MLS^®

28The appellant provided the Board with:

• An inventory of properties as of January 14, 2014 in the Brooklin area showing the number of days on the market, their list prices and sale prices for those sold. This information was for homes that were all four-bedrooms except one at Genevieve.

• Information from MLS^® listing of homes for sale in January 2014 and to point out the differences in certain features (such as exterior finishes as well as pricing details) to support her argument that MPAC’s suggested comparable properties were superior to her property.

v. My Neighbourhood Sales of Suggested Comparable Properties

29The appellant submitted a document titled “My Neighbourhood Sales” which is a list of 15 properties and their accompanying details which she believes are properties that are comparable to her property.

vi. Statistics pertaining to Sale Prices and Property Value Assessments in Durham

30Statistical information was provided by the appellant to show the average and median sales price of homes in the Durham region as well as Historic Statistics of Toronto MLS^® Sales and average prices from 1967 to 2012.

Analysis of Evidence

MPAC’s Evidence

31The assessor presented five suggested comparable properties as shown in Table 1. The Board accepts the suggested comparable properties submitted by MPAC located at 321 Cachet Boulevard and 2 Rockland Crescent as being similar to the subject property for the following reasons:

1. Both are located within the vicinity of the subject property and are in the same homogeneous neighborhood.

2. The average square footage of the site area of the two suggested comparable properties are similar to that of the subject property. The average square footage of the land of the two suggested comparable properties is 7,237 while the site area of the subject property is 7.842. In this case the Board accepts this variation as being within a reasonable range for comparative purposes.

3. The average building area of the two suggested comparable properties is 2,869.5 square feet which is 125.5 square feet higher than the actual square footage of the subject property at 2,744. The Board also accepts the variation as being reasonable for comparative purposes.

4. Both suggested comparable properties, like the subject property have attached garages and outdoor pools.

32The two suggested comparable properties have valid sales. In each case the sales occurred within the valuation date of January 2012.

33The Board rejects the remaining suggested comparable properties submitted by MPAC and located at 31 Bellhouse Place, 97 Holsted Road and 15 Rockland because though they have some similar features as the subject property, their lot sizes are on average approximately fifty percent (50%) smaller than the subject property.

Appellant’s Evidence

34The appellant provided 15 suggested comparable properties (shown in Table 2).

35The appellant also provided extensive information in Exhibit 3 regarding issues that she believes that should be taken into account by the Board in determining her assessment. The Board has examined the various issues raised by the appellant and finds that the only portion that has relevance to the determination of current value pertains to the section regarding sales of similar properties in the subject neighbourhood.

36The Board finds that the following nine of the fifteen suggested comparable properties have qualities that are similar to the subject property:

i. 366 Carnwith;

ii. 363 Carnwith;

iii. 22 Lamport

iv. 35 Rockland

v. 87 Rockland

vi. 186 Cachet

vii. 180 Cachet

viii. 173 Cachet and

ix. 321 Cachet

37The nine properties above are similar to the subject property in the following respects:

• The average building area of the nine properties is 2,824 square feet which is larger than the subject property by just 80 square feet.

• The year constructed of the subject property is 2011. The nine properties were all constructed within a six year period or less than the subject property. The Board considers this sufficiently similar in age to the subject property.

• All nine properties are in the same homogeneous neighbourhood.

38The Board however rejects seven of the above properties despite their similarities since their lot sizes are approximately forty (40%) smaller than the subject property and accepts only the two properties located at 22 Lamport and 321 Cachet which, in addition to the similarities listed above, also have lot sizes that are more in line with that of the subject property being on average 6,939 square feet compared to the subject property at 7,842 square feet.

Determination of Current Value

39The Board finds that the best method to determine the current value of the subject property is based on the sales of similar properties in the neighbourhood. The Board finds that the two suggested comparable properties submitted by MPAC and located at 321 Cachet and 2 Rockland as well as the two properties submitted by the appellant located at 22 Lamport and 321 Cachet, all having valid sales, meet this criteria.

40The resulting average sales value per square foot of the three (both MPAC and the appellant submitted 321 Cachet – hence three properties) comparable properties with valid sales is $191. When this value is applied to the subject property it results in a current value of $524,104.

41The Board finds that the current value of the subject property as of January 1^st2012 for the 2013 taxation year is $524,104.

Equity With Similar Lands in the Vicinity

42The Board is required under s. 44.(3) sub-paragraph (b) of the Act, to have reference to the value at which similar lands in the vicinity are assessed and adjust the assessment of the land to make it equitable with that of similar lands in the vicinity if such an adjustment would result in a reduction of the assessment of the land.

43For purposes of establishing equity, properties do not need to be comparable, they need to be of a similar nature and within a reasonable proximity. MPAC presented the sales of 50 residential properties within 0.44 kilometers of the subject property which occurred between January 2011 and December 2012. For purposes of establishing equity the Board considers the sales between January 2011 and December 2012 as valid sales for establishing equity. The average Assessment to Sales Ratio (“ASR”) of these properties is 0.97. A value within a 10 percentage points is usually considered an acceptable value. In this case the average ASR of 0.97 suggests that MPAC’s methodology may be producing assessments approximately three percent lower than values determined by sales which falls within the acceptable range of values. The Board therefore finds that no adjustment is required for equity in accordance with s. 44.(3)(b) of the Act.

CONCLUSION

44The Board finds that the current value of the subject property is $524,104.

45The Board has made reference to similar lands in the vicinity and finds that no reduction is required for equity under s. 44.(3)(b) of the Act.

46The assessor indicated that an adjustment has been made in its system to reduce the assessment from $533,000 to $520,000 that took into account the addition of a pool and a negative 5% adjustment for abutting a commercial property. The Board similarly adjusts the assessment from $524,104 to $511,000 (rounded).

Footnotes

1. 1Subsection 5 permits the Minister to prescribe a different valuation day. A different day has not been prescribed.