Carolyn Suter v. Municipal Property Assessment Corporation, 2018 CanLII 102693

Assessment Review Board

Commission de révision de

l’évaluation foncière

ISSUE DATE:

October 25, 2018

FILE NO.:

WR 154303

Assessed Person(s):

Carolyn Suter

Appellant(s):

Carolyn Suter

Respondent(s):

Municipal Property Assessment Corporation (“MPAC”)

Region 15

Respondent(s):

Town of Oakville

Property Location(s):

2194 Sunnyvale Drive

Municipality(ies):

Town of Oakville

Roll Number(s):

2401-020-190-23400-0000

Appeal Number(s):

3265956 and 3305452

Taxation Year(s):

2017 and 2018

Hearing Event No.:

701282

Legislative Authority:

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

Heard:

June 29, 2018 by telephone conference call

APPEARANCES:

Parties

Representative

Carolyn Suter

Self-represented

MPAC

Asoka Jayalath

Town of Oakville

Susan Price

DECISION OF THE BOARD DELIVERED BY LESLIE FLEMMING

Background

1Carolyn Suter (the “Appellant”) is the owner of 2194 Sunnydale Drive in the Town of Oakville, (the “Subject Property”), which is a single family detached home in a subdivision in Oakville.

2Pursuant to the provisions of the Assessment Act (the “Act “), the assessment of land shall be based on its current value. The Act also provides that, for the 2017 to 2020 taxation years, the Municipal Property Assessment Corporation (“MPAC”) is required to assess this value as of the valuation date of January 1, 2016.

3MPAC has assessed the value of the Subject Property, as of January 1, 2016, at $725,000. However, following the hearing MPAC revised the current value to $690,000 based on the cost of repair of a swimming pool which is failing.

4The Appellant has filed appeals for the 2017 and 2018 taxation years with the Assessment Review Board (the “Board”), pursuant to s. 40 of the Act. It is her position that MPAC’s assessment of current value is too high and that the correct current value is $680,000. At this hearing, MPAC takes the position that its assessed value should be changed to $690,000.

5Pursuant to s. 40.(11) of the Act, the Town of Oakville (the “Town”) is a party to this proceeding. It is the Town’s position that the correct current value is $690,000.

6Section 44.(3)(b) of the Act, directs the Board to reduce the current value of the Subject Property if similar lands in the vicinity have been assessed at a lower value (“equitable reduction”). The purpose of this provision is to fairly distribute of the municipal tax burden according to the value of the property possessed by each ratepayer. MPAC submitted evidence of its Equity Analysis Study and took the position that an adjustment for equity was not required. The Appellant did not assert that an equitable reduction was required, nor did the Town. Therefore, in this proceeding, this ground for appeal is not in issue.

7At the completion of the hearing, the Board reserved its decision. For the reasons that follow, the Board finds that the 2017 and 2018 tax years is $715,000. Pursuant to s. 44.(3)(b) of the Act, an equitable reduction of this value is not required.

Relevant Legislation

8The Act states that:

1. “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.

Valuation days

19.2(1) 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 the period consisting of the four taxation years from 2013 to 2016, land is valued as of January 1, 2012.

4. For the period consisting of the four taxation years from 2017 to 2020, land is valued as of January 1, 2016.

Burden of Proof

40.(17) 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.

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.

DISCUSSION, ANALYSIS AND FINDINGS

Issue No. 1: What is the correct current value of the Subject Property for the taxation years 2017 and 2018?

MPAC’S Evidence

9Asoka Jayalath represented MPAC. She is a property valuation analyst with MPAC, and prepared and presented the Valuation Report, dated April 3, 2018, and Equity Analysis report.

10MPAC described the Subject Property as a residential single family detached home, two storeys in height, with a building area of 1,835 square feet (“sq. ft.”), built in 1969, but upgraded to show an effective year built of 1979. Photographs show the neighbourhood to be an older residential subdivision with mature trees and spacious lots. The Subject Property’s site area is 0.14 acres in size. There is an in-ground pool in the backyard. The home has two and one-half bathrooms, an unfinished basement, and an attached garage of 480 sq. ft. The quality of the construction of the home as ranked by MPAC is 6.0.

11MPAC used the direct sales comparison method in order to determine the value of the Subject Property. MPAC selected four single family residential homes located in the same neighbourhood as the Subject Property, which is identified as A25. None of the homes bordered water. All of the homes had slightly larger site areas; three of the proposed comparable residences had outdoor pools. All had attached garages.

12MPAC’s proposed comparable properties sold during 2015 and 2016, which makes the sale dates quite close to the valuation day. MPAC carried out a Sales Ratio Trend Analysis study in order to derive values in the residential real estate market during 2015 and 2016. This allowed her to adjust values to the valuation day, so that she could provide the time-adjusted sales (“TAS”) amounts for each of her chosen comparable sales. The Appellant did not object to the use of TAS sales, and I have referred to those values here.

13The following chart lists MPAC’s four proposed comparable sales, with the values and the building total areas listed. The homes with swimming pools are identified. Two homes have garages half the size of the Subject Property’s attached garage - they are identified.

MPAC’S PROPOSED COMPARABLE PROPERTIES - HIGHLIGHTS

Subject Property

1. 248 Sunray Road

2. 297 Surrey Drive

3. 2075 Salmon Road

4. 155 Ulster Drive

Date of Sale

June, 2016

April, 2015

October, 2015

August, 2016

TA Price

$677,877

$803,849

$886,946

$941,359

Eff. Yr. Built

1979

1977

1978

1987

1986

Build. Area (sq. ft.)

1,835

1,446

1,834

1,949

2,092

Lot Size (Acres)

0.14

0.17

0.2

0.23

0.22

Garage (sq. ft.)

480

240

480

480

240

Finished Bsmt. (sq. ft.)

325

500

1,220

Pool?

Yes

Yes

Yes

No

Yes

14MPAC went over the differences between the properties, and suggested that Sales 2, 3 and 4 were superior to the Subject Property either because they were larger homes on larger lots (Sales 3 and 4) or had a finished basement and slightly larger lot (Sale 2). Of these four examples, only Sunray Road would be less valuable than the Subject Property because of the smaller home and smaller garage situated on only a marginally larger lot.

15Using the concept of “bracketing”, or finding a value by comparing a property with less valuable, more valuable and reasonably similar properties, MPAC concluded that the Subject Property would have sold for $725,000 in January, 2016. From that value it deducted $35,000 for the “cost to cure” the failing swimming pool.

MPAC’s Submissions

16Relying on its evidence, MPAC submits that the correct current value for the taxation years 2017 and 2018 is $690,000.

Appellant’s Evidence

17The Appellant represented herself. She provided several exhibits in order to assist in her description of the property. She also provided information regarding the assessments of four similar properties in her neighbourhood and also four local residential sales. Unfortunately, all the sales took place in either 2012 or 2013, which presents two problems: (1) the sales are largely too out of date to be helpful for the current valuation day; and (2) there is no evidence of appropriate time adjustments going back to 2012 and 2013 which would assist in estimating the changes in the prices had the sales taken place in 2016.

18For example, the Appellant’s first sale at 269 Sunray Road was for $635,000. If the time adjustment factor were identical to the time adjustment factor for January 2015, as set out in MPAC’s evidence, the estimate of value for 2016 would be obtained by multiplying the sale price by the factor 1.237, which would lead to an adjusted value of $785,495. However, without a sales trend analysis dating back to 2012 to refer to, I am unable to convert the Appellant’s proposed comparable property values into values for January 1, 2016.

APPELLANT’S PROPOSED COMPARABLE PROPERTIES - HIGHLIGHTS

Subject Property

1. 269 Sunray Road

2. 263 Sunray Road

3. 279 Surrey Road

4. 243 Sunset Drive

Date of Sale

August, 2013

April, 2013

July, 2012

May, 2013

Sale Price

(no adjustment)

$635,000

$564,700

$654,000

$631,000

Yr. Built

1979

1969

1969

1969

1969

Build. Area

(sq. ft.)

1,835

1,863

1,741

1,840

1,649

Lot Size (Acres)

0.14

0.14

0.12

0.14

0.19

Garage (sq. ft.)

480

Unknown

Unknown

Unknown

Unknown

Finished Bsmt. (sq. ft.)

No

No

Yes

Yes

Yes

Pool?

Yes

No

No

Yes

No

19The Appellant also provided a listing agreement for her Property 3 in order to indicate the improvements to the property. The listing shows that it was only listed for under $650,000. However, the listing is dated 2012, so is not current enough to shed light on the value of the property in 2016.

20Lastly, the Appellant filed photographs of the failing swimming pool. She testified that it is still being used, but the problems with the shifting of the pool deck, and also the sides of the pool, indicate major structural deterioration. The Appellant testified that the pool had been constructed in 1974, and she provided a page from a manual with that date on it. She also provided evidence that a pool liner had been installed in 1998. However, in her estimate, the pool needs to be re-done. She has made inquiries and advised that the quote she received is for $38,000.

Appellant’s Submissions

21Relying on her evidence, the Appellant submits that the correct current value for taxation years 2017 to 2018 is $680,000, comprised of $660,000 for the lot and building and $20,000 for the swimming pool.

22In support of her appeal, the Appellant argued that the assessed values of the neighbouring properties as outlined in MPAC’s evidence and her own shows that the average value of homes just like hers in the neighbourhood are assessed at an average value of $655,000.

Evidence for the Town of Oakville

23Susan Price, the Assessment Review Officer for the Town gave evidence on behalf of the Town. Documentary evidence submitted on the Town’s behalf included an opinion of value by Ms. Price, a photograph of the Subject Property, an aerial photograph of the immediate neighbourhood of the Subject Property, and three proposed comparable sales in the neighbourhood.

24The Town’s comparable sales do not include time adjustments, but all took place in late 2015 or mid-2016. Highlights of the three properties are set out in the chart below, and I have calculated the changes in value over time using the time adjustment factors provided by MPAC. Ms. Price did not object to the evidence of the time adjustment factors in her presentation.

TOWN OF OAKVILLE’S PROPOSED COMPARABLE PROPERTIES - HIGHLIGHTS

Subject Property

1. 2216 Unwin Crescent

2. 2063 Seafare Drive

3. 425 Southland Crescent

Date of Sale

December, 2015

October, 2015

July, 2016

Sale Price (no adjustment)

$675,000

$695,000

$830,000

TA Factor

1.008

1.043

0.902

TA Sale Price

$680,400

$724,885

$748,660

Eff. Yr. Built

1979

1978

1964

1980

Build. Area (sq. ft.)

1,835

1,664

1,514

1,815

Lot Size (Acres)

0.14

0.12

0.16

0.16

Garage (sq. ft.)

480

Unknown

Unknown

Unknown

Finished Bsmt.

No

Yes

No

Yes

Pool?

Yes

Yes

No

No

25The Town also provided a street map of the vicinity of the Subject Property in order to show that Sunnydale Drive was south of Rebecca Street, a busy thoroughfare that divides the southern part of the town from the northern part. The southern part is closer to Lake Ontario and the Town advised that properties south of Rebecca Street are generally more valuable than similar properties north of the street. As far as the Town’s proposed comparable properties are concerned, Southland Crescent and Unwin Crescent are north of Rebecca Street, and the Subject Property and Seafare Drive are south.

Town’s Submissions

26The Town supports MPAC’s decision to reduce the current value of the Subject Property by $35,000 due to the condition of the pool. The Town supports a finding of a current value of $690,000 for the Subject Property as of January 1, 2016, for the taxation years 2017 and 2018.

Findings on Current Value

27The parties are not far apart in their submissions regarding current value. All three parties made effective use of the direct sales comparison approach in determining value. It is unfortunate that the values were not all for the same time period. Without either adjusting all or not using time adjustments, it is difficult to co-ordinate values of different sale dates.

28The Board finds that the most similar homes to the Subject Property include 297 Surrey Drive (MPAC’s Property 2), with a similar-sized home, garage, and pool, with an effective year built only one year older than the Subject Property. Surrey Drive is also south of Rebecca Street, like the Subject Property is. It’s time-adjusted value is $803,849. It would have a somewhat higher value than the Subject Property because of its larger lot (0.2 acres) and its partially finished basement.

29Another similar home to the Subject Property is 425 Southland Crescent (the Town’s Property 3), a similar home in size and effective age, although without a pool but with a partially finished basement. The TAS price for this home was $748,660.

30A third home, proposed by the Appellant, is similar in size to the Subject Property. This is 279 Surrey Road, a home of 1,840 sq. ft. and a similar sized lot. The home has a pool and a finished basement. Unfortunately, there is no means available to take a sale from July, 2012, and compare it effectively with sales adjusted to 2016. The sale took place for $654,000 in 2012; it would most likely be more valuable four years later, although there is no evidence before us to assist in determining how much more valuable.

31The good variety of proposed comparable homes supports a current value of the Subject Property in the amount of $750,000. The homes with values below $700,000, are clearly inferior in that they are smaller, have smaller garages and for the most part, lack pools. The sales produced by the Appellant are all below $700,000, but none are more recent than 2013, which makes them not comparable. Other sales in the low range produced by MPAC are clearly inferior to the Subject Property, such as 248 Sunray Road, which sold for the time-adjusted price of $677,877 in June, 2016. This proposed comparable property is smaller, with a basement area approximately half the size of the Subject Property’s. While it has a slightly larger pool, the quality is shown as lower than the Subject Property’s pool. Its garage is half the size of the Subject Property’s garage. It is clearly of a lower value when compared to the Subject Property.

32Sales in the higher range, produced by MPAC and the Town, are superior to the Subject Property in that they have larger building areas, larger site areas, and partially or fully finished basements. Examples include 297 Surrey Drive, which sold for a time adjusted price of $803,849 on April 24, 2015, and 2075 Salmon Road which sold for $850,000 in July, 2016, with a time-adjusted value of $886,946.

33Notwithstanding the value arrived at in examining comparable sales, the Appellant raises a good point about the deterioration of the swimming pool. This would be a very obvious deficiency to anyone wishing to purchase the property, and the photographic evidence discloses that the problems have arisen over time, which means they would have adversely affected the integrity of the pool in 2016. While the Appellant failed to produce an invoice for the work required to repair the pool, both MPAC and the Town of Oakville accepted the amount of $35,000 as being a realistic expenditure to repair the serious problems shown in the photographs.

34Therefore, the Board finds that the current value of the Subject Property, including the cost-to-cure reduction for the swimming pool, is $715,000.

DECISION

35The correct current value of the Subject Property as of the valuation day is $715,000 for the taxation years 2017 and 2018. The assessment is reduced from $725,000 to $715,000.