Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: August 09, 2018

FILE NO.: WR 151942

Assessed Person(s): Alexandre Noukhovitch, Reguina Ekaterinoslavskaia

Appellant(s): Alexandre Noukhovitch, Reguina Ekaterinoslavskaia

Respondent(s): Municipal Property Assessment Corporation (“MPAC”) Region 07

Respondent(s): City of Kawartha Lakes

Property Location(s): 283 Nevison Drive

Municipality(ies): City of Kawartha Lakes

Roll Number(s): 1651-310-040-34700-0000

Appeal Number(s): 3195158 and 3292918 (deemed 2018 appeal)

Taxation Year(s): 2017 and 2018 (deemed appeal)

Hearing Event No. 696665

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

Heard: March 23, 2018 by telephone conference call

APPEARANCES:

Parties	Representative
Alexandre Noukhovitch and Reguina Ekaterinoslavskaia	Alexandre Noukhovitch
MPAC	Judy Piggott
City of Kawartha Lakes	No one appeared

DECISION OF THE BOARD DELIVERED BY TYRONE D. SKANES

ISSUE

1The appeal before the Assessment Review Board ("Board") is filed by Alexandre Noukhovitch and Reguina Ekaterinoslavskaia (“the Appellants”) in respect of the assessment of a single-family detached seasonal/recreational home on water, for the 2017 taxation year. The subject property is located at 283 Nevison Drive (“SP”).

2The single-storey dwelling with 1,326 square feet ("sq. ft.") was built on Gull River in 1974 but has an effective year built of 1986 as there was an addition added in 2000. The lot size is 0.69 of an acre with an effective frontage of 197 feet (“ft.”) and an effective depth of 176 ft. The SP has a septic bed but uses river water. There is hydro service to the dwelling and it is winterized. The dwelling is assessed as average condition with a quality of construction (“QC”) rating of 5.0. There is a large deck attached to the dwelling. There are two small sheds on the property. It is accessed by a private road.

3Judy Piggott, representing MPAC introduced the sales of three comparable properties that she said were good comparators, despite being inferior to the SP. She said that the current value assessment (“CVA”) of the SP was initially $305,000 but the Appellants applied for request for reconsideration (“RfR”) and the property was inspected. It was discovered that a deck had been added and she valued that addition at $7,000 and she revised her opinion of value to $312,000. However, Ms. Piggott said that out of a sense of fairness she would honour the initial value of $305,000. She said that she believed this value was fair and reasonable and was recommending the Board confirm it.

4Alexandre Noukhovitch, representing the Appellants, entered limited sales and assessment information on several area properties that had sold but with no other information about the properties. He strongly disagreed with the comparable properties entered by MPAC and asked the Board to disregard them. He asked the Board to reduce the assessment of the SP to $260,485.

5The issue before the Board for determination is whether the assessment of the SP for the 2017 taxation year is at current value and whether the assessment is equitable with the assessment of similar lands in the vicinity.

DECISION

6The Board is required by s. 44.(3)(a) and (b) of the Assessment Act (“Act”) to determine the current value of the land and have reference to the value at which similar lands in the vicinity are assessed and adjust the assessment 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.

7The Board confirms the assessment of the SP at $305,000 for the 2017 taxation year and finds that no adjustment is required for equity.

REASONS FOR DECISION

Relevant Legislation

8Section 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.

MPAC's Position and Evidence

9Ms. Piggott’s valuation report was entered into evidence as Exhibit 1 and an Equity Analysis Report as Exhibit 2. She testified that the direct sales comparison approach to value was used in determining the current value of the SP.

10Ms. Piggott entered the sales of three properties that she opines are good comparators to the SP, despite being inferior, as all are riverfront seasonal properties. All are located on Nevison Drive in the same neighbourhood. She says that the SP is superior to the comparable properties because it has been improved and it is winterized. She advised that although Property One was listed in the description sheet as being in fair condition, it was currently undergoing an extensive renovation and would be upgraded. Those properties are reflected below in Table 1.

11Ms. Piggott testified that she time adjusted the sales prices (“TAS”) of the comparable properties to the valuation date of January 1, 2016.

12Ms. Piggott said she believed that the CVA of $305,000 was fair and reasonable and recommended that the Board confirm the assessment at that value.

13Ms. Piggott entered an equity analysis into evidence. She used the sales of 30 waterfront seasonable properties located within 12 kilometres of the SP and determined that the median assessment to sales ratio (“ASR”) was 1.01. She said that this indicated to her that similar lands in the vicinity were being assessed at or near their correct current value and that an adjustment was not required for equity.

14On cross-examination, Ms. Piggott was asked if it was possible that the deck attached to the house had been assessed twice and she said that it had not. She testified that when the SP was assessed in 2012, there was no mention of a deck. However in 2013, at the RfR, the SP was inspected and pictures from that inspection clearly indicated a deck but for reasons not known to her the SP had not been assessed as having a deck. She clarified that the CVA of $305,000 was being honoured despite her opinion of value being $312,000 to account for the deck. Ms. Piggott was further asked how she chose the 30 properties used in the equity analysis. She explained the criteria used did not have to be as rigid as that used for current value. She said that properties analyzed for equity only had to be of the same nature and function as the SP.

Appellants’ Position and Evidence

15Mr. Noukhovitch entered a documentary package as Exhibit 3.

16Mr. Noukhovitch said that the Appellants purchased the SP in 2011 for $295,000 and he opined that they paid $20,000 more than it was worth. He advised that they were unfamiliar with the area and paid too much.

17Mr. Noukhovitch said that, in his opinion, the most valuable aspect of the SP was the land value. He said that the water frontage on a river cannot be viewed through the same lens as water frontage on a lake. He said that in many instances, river frontage can be a liability due to potential flooding concerns. He did not offer any evidence of when this had been a problem for the SP.

18Mr. Noukhovitch entered seven properties with sales and assessment information into evidence that included the three comparable properties entered by MPAC. However, there were no other details about those properties provided.

19Mr. Noukhovitch said that he believed that the assessment of the Subject Property ought to be a value around $260,000.

Board's Deliberations - Current Value

20The best evidence of current value is the sale of the subject property if the sale meets the definition of current value on or near the valuation day. When no such sale occurs, as in this instance, the Board looks to the sale of similar properties in the vicinity to determine current value.

21The Board has carefully considered the testimony of the parties and the documentary evidence tendered as exhibits.

22The Board, when comparing properties, does not expect exactness or sameness. Therefore, the Board looks at similarity of characteristics, amenities and location to determine comparability.

23The Board usually considers the sales of comparable properties that have occurred within one year on either side of the valuation date as the ideal time period for consideration. The Board occasionally does extend the time period for considering comparable properties when the parties have demonstrated that there are an insufficient number of relevant sales during the ideal time period. The Board will do so in this instance and consider Sale 1, as the assessor articulated there were a limited number of sales for her to consider.

24MPAC submitted the sales of three properties for consideration. The assessor said that the comparable properties were good comparators to the SP.

25Although there are differences between the SP and the comparable properties submitted by MPAC the Board has to deal with the evidence placed before it. As these are unique properties the Board accepts that finding a sufficient number of relevant sales can be a daunting task. The assessor articulated that she wished to remain within the homogenous neighbourhood where the SP is located, as there were a limited number of riverside properties from which to choose.

26The Board accepts this explanation and will consider the comparable properties submitted by MPAC.

27These properties are reflected in Table 1.

Table 1

Property	Building Size (Sq. ft.)	Lot Size (Sq. ft.)	Year Built	Effective Year Built	Quality Construction (QC)	Time Adjusted Sale Price (TAS)	Current Value Assessment (CVA)
Subject Property	1,326	34,672	1974	1986	5.0	$305,000
Sale 1	705	21,541	1966	1974	5.0	$145,880	$189,000
Sale 2	646	25,400	1963	1990	4.5	$238,841	$232,000
Sale 3	856	19,680	1969	1984	4.5	$227,575	$225,000

28The Appellant did not provide any sales evidence that the Board could consider for similarity. He provided the Board with evidence that sales had occurred, including the three comparable properties submitted by MPAC. However, there was no other information provided about those properties from which the Board could conduct an analysis.

29Therefore, the Board only has the three comparable properties submitted by MPAC to consider.

30The Appellant told the Board that although he paid $295,000 in 2011 for the SP he believes that because of his unfamiliarity with the area that he probably overpaid by as much as $20,000. He did not provide any supporting evidence to prove this belief and the Board will not consider it.

31The Appellant also said that a riverside property, as opposed to a lakeside property, was considered less valuable as it was subjected to possible flooding concerns. He did not provide any evidence to prove this assertion and the Board will not consider it.

32Having accepted MPAC’s comparable properties, despite them being obviously inferior to the SP, the Board must turn now to determining the most appropriate method of determining current value. There are too few properties and none which are comparable or superior to the SP to use the bracketing method.

33Therefore, the Board will utilize the building per square foot sales value method. The Board determined that the average per square foot sales value of the comparable properties is $278.85. When this value is applied to the square footage of the SP at 1,326, a value of $369,856 is returned.

34The Board finds that the current value of the SP is $369,856.

Board’s Deliberations – Equity

35MPAC entered an equity study into evidence whereby the sales of 30 similar properties located within 12 kilometres of the SP were analyzed. The assessor determined that the median ASR returned at 1.01 and that this fell within MPAC’s ideal range of 0.95 to 1.05 which indicates that similar lands in the vicinity are being assessed at or near their correct current values.

36This Board accepts this equity analysis as the Appellant did not present any equity evidence to dispute it.

CONCLUSION

37The Board confirms the assessment of the SP at $305,000 for the 2017 taxation year and finds that no adjustment is required for equity.

2018 DEEMED APPEAL

38An appeal for the 2017 taxation year is presently before the Board. Section 40.(26) of the 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 2017 appeal before March 31, 2018. For that reason, this decision also applies to the 2018 taxation year.

39Section 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.