Huiping Wang and Shiying Hu v. Municipal Property Assessment Corporation, 2016 CanLII 28438

Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: May 11, 2016

FILE NO.: WR 138786

Assessed Person(s): Huiping Wang and Shiying Hu

Appellant(s): Huiping Wang and Shiying Hu

Respondent(s): Municipal Property Assessment Corporation (“MPAC”) Region 15

Respondent(s): City of Brampton

Property Location(s): 16 Vernosa Drive

Municipality(ies): City of Brampton

Roll Number(s): 2110-080-011-73332-0000

Appeal Number(s): 3099733 and 3154703 (deemed 2016 appeal)

Taxation Year(s): 2015 and 2016 (deemed appeal)

Hearing Event No. 616630

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

Heard: February 2, 2016 in Brampton, Ontario

APPEARANCES:

Parties

Counsel+/Representative

Huiping Wang Shiying Hu

Huiping Wang

MPAC

Jerry Kocijowsky

City of Brampton

Aida Karreman

DECISION OF THE BOARD DELIVERED BY MARGARITA OKHOVATI AND ANTHONY LaREGINA

INTRODUCTION

1The appeal before the Assessment Review Board (“Board”) is filed by the Assessed Persons in respect of the returned assessment of $647,000 for the 2015 taxation year for the subject property at 16 Vernosa Drive in the City of Brampton.

ISSUES

2Jerry Kocijowsky, representative for MPAC, is of the view that a fair and equitable assessed value for the subject property is $647,000 for the 2015 taxation year. He testified that the current value assessment (“CVA”) of the subject property is based on the direct sales comparison approach to value supported by the time adjusted sale of six comparable properties presented by MPAC.

3Huiping Wang, one of the Assessed Persons/Appellants, contests that the current value of the subject property is too high. He requests that the Board reduce the value of his property to $592,912, which is the purchase price of $635,000 on August 22, 2014, less the Harmonized Sales Tax (HST).

4The City of Brampton was in attendance however, no evidence was adduced in the hearing.

5The Board has to decide:

• Whether the returned assessment of $647,000 for the 2015 taxation year for the subject property is at current value as at the valuation date of January 1, 2012.

• Whether the value is equitable with the assessments of similar lands in the vicinity.

DECISION

6The Board determined that the current value of the subject property is $612,898 and that no further adjustment is required to make this value equitable with that of similar lands in the vicinity.

7Therefore, the Board reduces the assessment of the subject property for the 2015 taxation year from $647,000 to $612,898.

REASONS FOR DECISION

Property Description

8The subject property is a two story residential building which was built in 2014. It is located at 16 Vernosa Drive in the north west of the City of Brampton. It is a newly developing area which is in a transition from a rural farm to suburban residential area. The subject property was described as having a total building area of 3,093 square feet (“sq. ft.”), a frontage of 40.03 feet (“ft.”), depth of 114.83 ft. for a total site area of 4,596.19 sq. ft. and a quality 6.5 rating, Exhibit 1, p.4. The description of the subject property was agreed to by Mr. Wang.

Current Value

MPAC’s Evidence

9In support of his argument, Mr. Kocijowsky presented Exhibit 1, which contains a Valuation Report of the subject property, Property Profile, Market Analysis for Comparable Sales, Price Change over Time Analysis and Maps.

10In support of current value, Mr. Kocijowsky presented a market analysis of six comparable property sales identified as Sales A, B, C, D, E and F, all of which are situated in the B64 homogenous neighborhood. The subject property is located in the B90 homogenous neighborhood. The analysis also contained both actual and time adjusted sales information.

11Mr. Kocijowsky testified that he would be relying on Sale A as the best comparison to the subject property.

12The details of the six comparable properties as presented by Mr. Kocijowsky, are set out in Table 1 below.

Table 1

Subject Property

Sale A

Sale B

Sale C

Sale D

Sale E

Sale F

16 Vernosa Drive

106 Fahey Drive

80 Young Drive

49 Maddybeth Crescent

9 Buster Drive

24 Coin Street

39 Shuter Lane

2012 Assessment $647,000

2012 Assessment $625,000

2012 Assessment $597,000

2012 Assessment 562,000

2012 Assessment $569,000

2012 Assessment $582,000

2012 Assessment $ $571,000

Sale Amount $592,912 August 2014

Sale Amount $623,000 April 2011

Sale Amount $614,000 June 2011

Sale Amount $630,000 September 2012

Sale Amount $$580,000 August 2011

Sale Amount $640,000 July 2012

Sale Amount $593,500 June 2012

Time Adj Sale N/A

Time Adj Sale $645,943

Time Adj Sale $631,142

Time Adj Sale $605,946

Time Adj Sale $591,115

Time Adj Sale $623,077

Time Adj Sale $580,166

Lot Size/sq. ft. 4,596.19

Lot Size/sq. ft. 4,457.98

Lot Size/sq. ft. 3,898.58

Lot Size/sq. ft. 4,319.17

Lot Size/sq. ft. 4,171.70

Lot Size/sq. ft. 3,650.61

Lot Size/sq. ft. 5,684.00

Building Size 3,093 sq. ft.

Building Size 3,074 sq. ft.

Building Size 3,254 sq. ft.

Building Size 2,865 sq. ft.

Building Size 2,966 sq. ft.

Building Size 3,212 sq. ft.

Building Size 2,813 sq. ft.

Data Element

Data Element Abut Gn spac

Data Element Utility Box

Data Element Utility Box

Data Element

Data Element

Data Element Cul-De-Sac

Relatively Comparable

Inferior

Inferior

Inferior

Inferior

Inferior

13In regard to time adjustment factor analysis contained in Exhibit 1, Mr. Kocijowsky testified that he studied 240 sales, which occurred in 2011 and 2012 in the subject property’s neighbourhood and the adjacent neighbourhoods. He submitted that his studies show an approximately 10.10% change in the market value.

14Mr. Kocijowsky testified that out of six comparable sales, Sale A is noted as the relatively comparable and therefore, the most comparable and Sales B, C, D, E and F, are noted as inferior and therefore, the least comparable to the subject property without further elaboration.

15Mr. Kocijowsky concluded his evidence by stating that the CVA of the subject property of $647,000 falls at the upper end of the range of adjusted sale values for the six comparable sales and therefore, requests that the Board confirm the assessment of the subject property at $647,000 for the 2015 taxation year.

16Mr. Kocijowsky also pointed out that the adjusted sale value of Sale A, which he believes is the most comparable to the subject property, is also at the upper end of the range of adjusted sale values for all the comparable properties.

Appellants’ Evidence

17In presenting his case, Mr. Wang submitted a list of twenty three sales in Exhibit 2, showing property size, lot size, selling price and relative taxes for each property. He testified that the suggested properties were sold all over the City of Brampton and that he was unaware of the sale dates. He testified further that he obtained the list of these properties from a real estate site.

18No other evidence was presented by the Appellant other than the total purchase price of his home of $635,000 including HST, which occurred in August 2015.

The Legislation

19In determining the value at which land shall be assessed, the Board must have regard to the following provisions of the Assessment Act (“Act”):

20Section 1 of the Act states:

“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.

21Section 19.(1) of the Act states:

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

22Section 19.2(1)2 of the Act states:

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

1. For the 2006, 2007 and 2008 taxation years, land is valued as of January 1, 2005.

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

3. For each subsequent period consisting of four consecutive taxation years, land is valued as of January 1 of the year preceding the first of those four taxation years.

(5) Exception. – Subsection (1) does not apply in respect of the valuation of land for a taxation year after 2004 if the Minister prescribes a different day as of which land is valued for that year.

23Section 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.

24Section 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.

25In determining the value at which any land shall be assessed, s. 44.(3)(a) and (b) of the Act requires the Board to do two things:

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.

Board’s Analysis and Conclusions

26The thrust of the Act is to rely on current value as the basis for assessed value. 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.”

27The best evidence of current value is the sale of the subject property on or close to the valuation day of January 1, 2012. If, as in this case, no such sale occurred, the sales of similar properties in the vicinity will be considered to establish current value of the subject property.

28The only sales evidence submitted to the Board in support of current value is the six comparable sales provided by MPAC in Appendix A: Market Analysis (Exhibit 1).

29In reviewing the above six sales, the Board notes the following:

• That the subject property is located in B90 homogenous neighborhood but the rest of the comparables are in B64 homogenous neighborhood. No evidence was submitted by MPAC as to what impact the differential of neighborhoods may have on the appeal before the Board.

• That although Sale A is relatively similar to the subject property with respect to effective site area, building total area, effective frontage and depth, walkout basement, etc. however, it abuts to green space. MPAC offered no opinion as to how much this may add to the value of the property.

• That the remaining five suggested comparables range from 277 sq. ft. smaller to 1,088 sq. ft. larger than the subject property.

• That all of the six comparables were five to ten years older than the subject property.

30Mr. Kocijowsky requested that the Board set the current value of the subject property at $647,000, which is not within the range but slightly above the range of adjusted sale values for the comparable properties. The Board is of the opinion that Sale A, 106 Fahey Drive, abuts a green space and is superior to the subject property which does not abut green space. The Board believes that the more appropriate value for the subject property is somewhere in the middle of the range of adjusted sale values of the comparable properties.

31With respect to the Appellants’ submitted list of properties, the Board notes that these properties are located all over the City of Brampton and range from 2,950 sq. ft. to 6,000 sq. ft. with various lot sizes. The Board has no evidence regarding other important details of these properties such as specifications of the buildings, year built, sale dates and other impediments that may impact the selling prices. Therefore, the Board cannot make use of these suggested comparables by the Appellant and assigns no weight to the aforementioned document.

32In reviewing the totality of the above evidence, the Board finds that the best available evidence for the current value of the subject property is the average time adjusted sales value of the six comparables presented by MPAC.

33The Board will set the current value of the subject property at $612,848 representing the average adjusted sale value of the six comparable sales.

34This value is further supported by the purchase price of the home in August 2014 of $635,000. Based on the Sale to “Assessment Ratio over Time” analysis presented by MPAC, it is clear that the market is increasing. It is therefore reasonable to conclude that with an increasing market, the time adjusted sale value of the subject property as of January 1, 2012, would be somewhat less than the price paid in August 2014. In this case, the current value of the subject property set by the Board as of January 2012 is 3.5 percent less which is very reasonable considering that the market increased 10% over a two year period.

Equity

35For the purposes of s. 44.(3)(b), based on the fact that neither party presented evidence in support of an equity, the Board finds that the current value, as determined above, does not require any further adjustment to make it equitable with the assessment of similar lands in the vicinity.

CONCLUSION

36The decision of the Board is therefore to reduce the assessment of the subject property from $647,000 to $612,898 for the 2015 taxation year.

2016 DEEMED APPEAL

37An appeal for the 2015 taxation year is presently before the Board. Section 40.(26) of the Assessment Act provides that the appellant is deemed to have made the same appeal for the subsequent taxation year if the appeal is not finally disposed of before March 31 of the subsequent taxation year. The Board has not disposed of the 2015 appeal before March 31, 2016. For that reason, this decision also applies to the 2016 taxation year.

38Section 40.(26) of the Act directs:

Deemed appeals, 2009 and subsequent years

(26) For 2009 and subsequent taxation years, an appellant shall be deemed to have brought the same appeal in respect of a property,

(a) in relation to the assessments under sections 32, 33 and 34 for the year; and

(b) in relation to the assessment, including assessments under sections 32, 33 and 34, for a subsequent taxation year to which the same general reassessment applies, if the appeal is not finally disposed of before March 31 of the subsequent taxation year or, if an assessment has been made under section 32, 33 or 34, before the 90th day after the notice of assessment was mailed.