Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: December 06, 2018

FILE NO.: WR 154544

Assessed Person(s): Shady Stasi; Jennifer Stasi

Appellant(s): Shady Stasi

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

Respondent(s): Town of Oakville

Property Location(s): 522 Hidden Trail

Municipality(ies): Town of Oakville

Roll Number(s): 2401-010-030-11211-0000

Appeal Number(s): 3270621, 3272381 and 3307720

Taxation Year(s): 2017 and 2018

Hearing Event No. 702269

Legislative Authority: Section 40 and 34 of the Assessment Act, R.S.O. 1990, c. A.31, as amended

Heard: July 23, 2018, by telephone conference

APPEARANCES:

Parties	Representative
Shady Stasi and Jennifer Stasi	Self-represented
MPAC	Valerie Lamothe
Town of Oakville	Susan Price

DECISION OF THE BOARD DELIVERED BY LESLIE FLEMMING

BACKGROUND

1Shady Stasi (the “Appellant”) is the owner of 522 Hidden Trail (the “Subject Property”), which is a single-family detached residence not on water located 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, MPAC is required to assess this value as of the January 1, 2016 valuation date.

3MPAC has assessed the value of the Subject Property, for the 2018 taxation year, at $1,352,000. Prior to the addition of an in-ground swimming pool, the property was assessed at $1,288,000 for 2017. The Appellant is appealing both the 2017 and 2018 assessments as well as the supplementary assessment in the amount of $64,000 in 2017 relating to the addition of the swimming pool.

4Consequently, the Assessment Review Board (the “Board”) must determine the value of the Subject Property on January 1, 2016, for the 2017 to 2018 taxation years (“current value”).

5At this hearing, MPAC takes the position that its assessed value is correct.

6Pursuant to s. 40(11) of the Act, the Town of Oakville is a party to this proceeding It is the Town’s position that the correct current value is $1,352,000.

7Section 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.

8MPAC presented evidence in the form of the Equity Analysis Report, which concluded that the median Assessment to Sale Ratio for 30 sales of similar properties in the vicinity established that the level of appraisal was 0.98 or well within acceptable margins of error as set out by the International Association of Assessing Officers (“IAAO”). MPAC’s report also demonstrated a coefficient of dispersion of 5.8, which was further evidence of the assessment of the properties employed in the analysis was well within acceptable standards. Neither the Town nor the Appellant submitted any evidence on the issue of equity.

9MPAC takes the position that an equitable reduction is not required. The Appellant did not assert that an equitable reduction is required. Therefore, in this proceeding, this ground for appeal is not in issue.

10At the completion of the hearing, the Board reserved its decision. For the reasons that follow, the Board finds that the current value for 2017 taxation year is $1,276,000 and the current value for the 2018 tax year is $1,315,000. The value of the supplementary assessment for 2017 is $39,000.

11Pursuant to section 44(3)(b) of the Act, an equitable reduction of this value is not required.

Relevant Legislation

12Relevant sections of the Act are as follows:

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.

S. 34 Supplementary assessments to be added to tax roll

34. (1) If, after notices of assessment have been given under section 31 and before the last day of the taxation year for which taxes are levied on the assessment referred to in the notices,

(a) an increase in value occurs which results from the erection, alteration, enlargement or improvement of any building, structure, machinery, equipment or fixture or any portion thereof that commences to be used for any purpose; . . .

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.

Issue

13The issue to be determined on this appeal is the correct current value of the Subject Property for the taxation years 2017 and 2018.

Discussion, Analysis and Findings

MPAC’S Evidence

14Valerie Lamothe, a property valuation specialist, represented MPAC and gave evidence based on her Valuation Report dated March 23, 2018, and her Equity Analysis Report.

15She began by describing the Subject Property, a two-storey single-family detached home located on Hidden Trail in Oakville, abutting a green space. The building comprises an area of 3,332 square feet (“sq. ft.”) and was built in 2012 in a subdivision of similar homes. MPAC assessed the quality of construction as 7 out of 10. The lot is 0.12 acres in size. The home has an attached two-car garage, four bedrooms, 3.5 bathrooms, and an in-ground pool of 512 sq. ft. Ms. Lamothe indicated that she has not inspected the Subject Property herself.

16Ms. Lamothe explained the concept of the direct sales comparison as a means of establishing value in residential properties, and gave evidence on the necessity of time-adjusting sale prices to make the values approximate to what they would have been on January 1, 2016, the “valuation day”. Her time adjustment factors were derived from analysing 397 sales between January, 2015 and December, 2016, and plotting the monthly fluctuations in prices. She determined that overall prices rose during this period by 32.14 per cent.

17Ms. Lamothe selected four comparable properties that she proposes to use for the purpose of comparison with the Subject Property in order to estimate its value. She used a technique called “bracketing” by which she estimated the value of the Subject Property by looking at properties that were superior, inferior or similar to it.

18MPAC four proposed comparable properties and their characteristics are summarized in the chart below:

MPAC’s Proposed Comparable Properties

[Note: All properties were built in 2012, and are given a Quality 7 rating by MPAC.]

	Subject Property	518 Hidden Trail	490 Hidden Trail	494 Hidden Trail	454 Hidden Trail
Eff. Frontage	50 ft.	50 ft.	45.31 ft.	44.98 ft.	61.4 ft.
Eff. Site Area	0.12 ac	0.11 ac.	0.1 ac	0.11 ac.	0.14 ac.
Building Total Area	3,332 sq. ft.	3,956 sq. ft.	3,070 sq. ft.	2,215 sq. ft.	3,956 sq. ft.
Basement Area	1,696 sq. ft.	1,843 sq. ft.	1,377 sq. ft.	1,612 sq. ft.	1,843 sq. ft.
Secondary Structures	Attached garage, pool	Attached garage	Attached Garage	Attached Garage	Attached Garage
Sale Price		$1,530,000	$1,260,000	$975,000	$1,365,000
Sale Date		08/2016	06/2015	01/2016	09/2016
Time-Adjusted Sale Price		$1,380,686	$1,354,760	$968,964	$1,213,543

19Ms. Lamothe testified that she considers the 518 Hidden Trail and 490 Hidden Trail properties quite comparable to the Subject Property, while the 494 Hidden Trail property is considerably smaller in building area as well as being sited on a slightly smaller lot. The last property, 454 Hidden Trail, is also considered inferior to the Subject Property, despite its larger lot size and building size because it does not back onto green space and it also abuts a busy road.

20MPAC had determined that the Subject Property’s current value using the comparison approach was $1,367,000 for 2018, which includes the supplementary assessment for the addition of the swimming pool in 2017. However, after the reconsideration process, MPAC revised the current value of the property for 2017 (prior to the addition of the pool) to $1,276,000. Following the addition of the swimming pool, the assessment was increased to $1,315,000, which is an increase of $39,000.

MPAC’s Submissions

21Based on the comparative sales, MPAC supports a current value of $1,276,000 for the 2017 taxation year, and then a supplementary assessment of $39,000 for the addition of the swimming pool, effective August 31, 2017. The resulting current value MPAC supports would be $1,315,000 for 2018.

Appellant’s Evidence

22Shady Stasi represented himself, and gave the evidence in support of his appeal. Mr. Stasi filed a written submission in which he set out his own comparable sales including four properties that sold in 2017 and one property (490 Hidden Trail) that sold in 2015. The following table sets out the main evidence regarding these proposed comparable sales.

Appellant’s Proposed Comparable Sales

	Subject Property	2235 Wuthering Heights Way	3200 Ribble Crescent	2173 Heathcliff Court	3400 Kinglet Court	490 Hidden Trail
Lot Size (acres)	O.12	0.12	0.14	0.14	0.11	0.1
Building Size (sq.ft.)	3,332	3,685	3,239	2,754	3,479	3,080
Building Age	4 yrs.	12 yrs.	12 yrs.	12 yrs.	14 yrs.	6 yrs.
Assessment	$1,352,000	$1,367,000	$1,268,000	$1,131,000	$1,050,000	$1,268,000
Sale Price		$1,680,000	$1,810,000	$1,811,000	$1,421,000	$1,260,000
Sale Date		June, 2017	June, 2017	April, 2017	Jan., 2017	June, 2015
Pool?	Yes	Yes	Yes	Yes	No	Yes
Finished Basement?	No	No	Yes	Yes	No	Yes

23Mr. Stasi submitted the comparable sales in an effort to show that his home was over assessed. All of the homes, except 2225 Wuthering Heights Way, were assessed for less than his home, while two of them also had swimming pools.

24Mr. Stasi also testified that one of his neighbours at 506 Hidden Trail also had a lower assessment when that property was virtually the same as the Subject Property. However, it had not had a recent sale.

25MPAC had added a value of $64,000 to the initial assessment of $1,288,000, bringing the value returned in 2018 to $1,352,000. Mr. Stasi was able to show them proof that the installation of the in-ground pool by Pioneer Pools cost a total of $48,810, inclusive of sales taxes. He argued that his second proposed comparable residence on Ribble Crescent was assessed at $1,268,000 while it was a larger home than the Subject Property having both a finished basement and an in-ground pool. That property sold in 2017 for $1,810,000. Mr. Stasi was unable to provide time-adjustment factors for his selections, so his evidence included actual sales values about a year and a half after the valuation day, January 1, 2016.

26Mr. Stasi’s proposed comparable sales are not necessarily from his own neighbourhood, and he admitted on cross-examination that the homes he had selected are within 10 kilometres of the Subject Property. However, they are all within the Town of Oakville, and he selected comparable homes which have many features in common with his own.

Appellants’ Submissions

27Relying on his evidence, the Appellant submits that the correct current value for taxation years 2017 to 2018 is $1,146,000. He submitted that the cost of the swimming pool had been over assessed, and suggested that a swimming pool, useful in Canada for such a short period of time given our climate, was less valuable when compared to a finished basement. A finished basement adds year-round utility to the home whereas an outdoor pool in Ontario is useful for only four to five months of the year.

Evidence for the Municipality

28Susan Price, the Assessment Review Officer for the Town of Oakville, gave evidence on behalf of the Town. Her document package included a photograph of the Subject Property, and an aerial view of Hidden Trail Circle showing the location of the Subject Property abutting a green space.

29Ms. Price used two of the same proposed comparable homes as MPAC had – 490 and 518 Hidden Trail Circle. She testified that these homes were built by Markay, a luxury builder, and the same builder as had built the Subject Property. Based on the sales of these two homes, Ms. Price agrees with MPAC that $1,276,000 for 2017 and $1,315,000 for 2018 are accurate current values.

Municipality’s Submissions

30Ms. Price concluded that the two comparable properties she included are very similar to the subject property with the exception that they do not have swimming pools and they do have finished basements. Like the subject property, these homes were built by a luxury home builder and they have increased in value since Mr. Stasi’s last appeal four years previously. They serve to confirm the value of the Subject Property at $1,276,000 and $1,315,000 for 2017 and 2018 respectively.

Analysis and Findings

31The Act requires the Board to make a finding of current value, and the best evidence of this is an arm’s length sale between a willing seller and a willing buyer at or near the valuation day – in this case January 1, 2016. Where no such sale has taken place, the usual method of determining value in respect of residential properties is to compare the Subject Property to recently sold properties that are similar in as many respects as possible to the Subject Property. Where differences occur, the Board tries to make adjustments based on the evidence of value presented by the parties.

32In this case, the parties presented a total of nine properties which they described as being comparable in various ways to the Subject Property. All of the properties proposed were within 10 kilometres of the Subject Property, and all were in the Town of Oakville. MPAC and the Municipality used property sales in the same neighbourhood as the subject property and also used time-adjustment tables provided by MPAC to give estimates of value as of January 1, 2016. The Appellant chose comparable sales from somewhat farther away from Hidden Trail Circle, but all of his comparable selections were homes on similar-sized lots – varying from 0.1 acre to 0.14 acres – and with buildings of between 2,754 and 3,685 sq. ft. The Appellant’s comparable homes were slightly older than the Subject Property, which was built in 2014.

33The parties disagreed on whether or not a finished basement and an in-ground pool add a similar amount of value to a property. The Appellant argued that a finished basement improved the utility of a portion of the home year-round, while an in-ground swimming pool provided utility only for four or five months of the year, and was weather-dependent. However, other than raising this issue and providing evidence of his personal expenditures to improve his property with a pool, Mr. Stasi offered no evidence of the comparative cost of finishing a basement or the comparative addition in overall value this improvement would generate.

33While Mr. Stasi’s proposed comparable sales offered more properties with pools than those proposed by MPAC, these sales do not support his position. They include two properties with in-ground pools which lack finished basements, making these the most comparable to his own property. They include 2225 Wuthering Heights Way and 3400 Kinglet Court. While the sales information for both is available for 2017 without time adjustment, both sales are for greater amounts than Mr. Stasi would suggest for his own property. 2225 Wuthering Heights Way sold for $1,680,000 and 3400 Kinglet Court sold for $1,421,000. Both these values are significantly greater than the value that Mr. Stasi proposes for his own home. While both of these homes are slightly larger, they are both older than the Subject Property by eight and ten years respectively.

34The Board is unable to draw any conclusions from these sales respecting the relative value of in-ground swimming pools when compared to finished basements. For example, 490 Hidden Trail, which is a comparable sale proposed by all three parties, has no pool but has a finished basement. It sold for a time-adjusted amount of $1,354,760, which is less than either of the homes noted by the Appellant which possess in-ground pools but lack finished basements.

35In conclusion, the Board finds that the value of the Subject Property, without the pool, would be less than $1,380,686, the time adjusted value of 518 Hidden Trail Circle, because of the larger size of the residence on that property. The Subject Property would be of greater value than 454 Hidden Trail, with a time-adjusted value of $1,213,543. While this property has a larger lot, and a larger residence, it lacks the proximity to green space, and also has a light traffic pattern not shared by the Subject Property. The Board finds that the current value for 2017, prior to the installation of the pool, would be $1,276,000 as recommended by MPAC and the Town of Oakville.

36MPAC and the Town both recommend that the actual installation cost of the in-ground pool be used as the supplementary assessment, which would then be in the amount of $39,000 rather than the original assessment of $64,000. The Board agrees.

37The Board agrees with the recommendation by MPAC and the Town that the 2018 current value, including the in-ground pool, be $1,315,000. This would be the lowest current value that would accord with the evidence of the three parties.

DECISION

38The correct current value for the 2017 taxation year is $1,276,000. The correct current value for the section 34 supplementary assessment is the actual cost of the swimming pool at $39,000. The correct current value for the 2018 taxation year is therefore the value of $1,276,000 added to the supplementary value of $39,000 which is $1,315,000.

39The Board therefore reduces the assessment for January 1, 2017, from $1,288,000 to $1,276,000. The Board reduces the supplementary assessment, effective August 31, 2017, from $64,000 to $39,000. Lastly, the Board reduces the assessment for January 1, 2018, from $1,352,000 to $1,315,000.

40An equitable reduction of the current value of the Subject Property, pursuant to section 44.(3)(b) of the Act, is not required.

“Leslie Flemming”

LESLIE FLEMMING

MEMBER

Assessment Review Board

A constituent tribunal of Environment and Land Tribunals Ontario

Website: www.elto.gov.on.ca Telephone: 416-212-6349 Toll Free: 1-866-448-2248```