Tribunals Ontario / Tribunaux décisionnels Ontario

Assessment Review Board / Commission de révision de l’évaluation foncière

ISSUE DATE: November 17, 2021 FILE NO.: WR 175042

Assessed Person(s): Jill Witkin Appellant(s): Jill Witkin Respondent(s): Municipal Property Assessment Corporation Region 09 Respondent(s): City of Toronto Property Location(s): 63 Parkwood Avenue Municipality(ies): City of Toronto Roll Number(s): 1904-111-280-03700-0000 Appeal Number(s): 3436459 and 3442507 Taxation Year(s): 2020 and 2021 Hearing Event No.: 755564 Legislative Authority: Section 40 of the Assessment Act, R.S.O. 1990, c. A.31

APPEARANCES:

Parties	Representative
Jill Witkin	Surin Toor
Municipal Property Assessment Corporation	Shirelle Miller
City of Toronto	No one appeared

HEARD: November 8, 2021 by telephone conference call

ADJUDICATOR(S): Jennifer Griffith, Member

DECISION

OVERVIEW

Request for Written Reasons After an Oral Decision

1Jill Witkin the (“Assessed Person/Appellant”) is the owner of 63 Parkwood Avenue (the “Subject Property”) in the City of Toronto (the “City”). The Subject Property is a Single-Family Detached (not on water) dwelling, Property Code 301. The Appellant filed appeals for the returned assessment of $3,249,000 for the 2020 and 2021 taxation years with the Assessment Review Board (the “Board”), pursuant to s. 40 of the Assessment Act, R.S.O. 1990, c. A.31 (the “Act”).

2It is the Appellant’s position that the Municipal Property Assessment Corporation’s (“MPAC”) current value assessment of $3,249,000 is too high and that the correct current value should be $2,365,000 based on sales evidence. MPAC takes the position that the correct current value should be $3,019,000 based on sale evidence. No one appeared on behalf of the City.

3Pursuant to s. 19(1) of the Act, the assessment of land shall be based on its current value; and s. 19.2(1)4 provides that, for the 2020 and 2021 taxation years, MPAC is required to assess this value as of the valuation date, January 1, 2016.

4Pursuant to s. 40(11) of the Act, the municipality in which the land is located is a party to this proceeding; however, no one appeared on behalf of the City.

5Pursuant to s. 44(3)(b) of the Act, MPAC takes the position that an equitable reduction of the current value is required. The Appellant asserts that an equity reduction is required and agrees with MPAC’s findings that the Assessment to Sales Ratio (“ASR”) of 0.90 for calculating the equitable value is correct.

Issues for the Hearing

6The issues to be determined on this appeal are:

1. What is the determination of the current value of the Subject Property for the 2020 and 2021 taxation years based on a direct comparison approach?

2. Whether there should be an equitable reduction of the current value pursuant to s. 44(3) of the Act, and, if so, what the amount of this reduction should be.

Result

7The Board finds the correct current value of the Subject Property is $3,312,000 as of the valuation date January 1, 2016, which is applicable to the 2020 and 2021 taxation years.

8The Board also finds that an equity reduction pursuant to s. 44(3)(b) is required and that the equitable value is $2,981,000.

9Therefore, the Board orders that the returned assessment of $3,249,000 be reduced to $2,981,000 for the 2020 and 2021 taxation years.

ANALYSIS

Issue 1 - What is the determination of the current value of the Subject Property for the 2020 and 2021 taxation years based on a direct comparison approach?

Direct Comparison Approach Based on Sales

10The Direct Comparison Approach estimates the market value by comparing the sale prices of similar properties (in terms of lot size, total building area, year built, quality of construction etc.) that have sold within a reasonable timeframe of the valuation date to the Subject Property. In this case the valuation date is January 1, 2016.

11In determining the correct current value, the Board references s. 19(1) of the Act, which states that the assessment of land shall be based on its current value, which is defined as 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”.

12For the reasons discussed below, the Board finds the correct current value at the valuation date of January 1, 2016 is $2,981,000.

13Reviewing the evidence in support of current value, the Board finds the five sales presented by MPAC and the Appellant to be the best evidence of current value.

MPAC’s Evidence in Support of Current Value

14MPAC’s Representative presents a Valuation Report dated June 11, 2021, which she prepared and testified to the information contained in the report.

15MPAC’s Representative testifies that the Subject Property had undergone major renovation in 2010 with an estimated cost of $400,000. The renovation was done internally and externally and was classified as a C type renovation, which is the level below a fully gutted renovation which is classified as a D type renovation.

16MPAC’s Representative also testifies that the Subject Property was sold on February 25, 2010 in the open market for $2,825,000. However, she did not rely on the sale in her analysis of current value because of the sale date.

17In support of current value, MPAC’s Representative presents four proposed comparable properties, which sold over the period 2014 to 2017 which occurred in the same neighbourhood as the Subject Property.

18MPAC’s Representative provides both the actual and time-adjusted sale prices, however, she relies on the time-adjusted sale prices in her analysis by utilizing the Direct Comparison Approach to value. The following Table is the analysis of the four proposed comparable properties:

MPAC’s Sales Analysis

4 PROPOSED COMPARABLE PROPERTIES	LOT SIZE (acre)	TOTAL BUILDING AREA (sq. ft.)	QUALITY RATING	YEAR BUILT	SALE DATE	SALE PRICE ($)	SALE PRICE (time adjusted) ($)	SALE PRICE (time adjusted per sq. ft.) ($)
199 Heath Street, West	0.19	3,962	8	1912	2015	2,376,000	2,471,271	623.74
27 Parkwood Avenue	0.18	4,117	9	1998	2015	3,800,000	4,093,045	994.18
91 Dunloe Road	0.14	3,800	8	1950	2014	2,356,000	2,879,292	757.70
29 Browside Avenue	0.15	4,334	9	2005	2017	5,500,000	4,654,140	1,073.86
Average	0.165	4,053	8.5	1966	2015	3,508,000	3,524,437	862.37
Subject Property	0.17	3,831	8.5	1908	NIL	N/A	N/A	N/A

19MPAC’s Representative testifies that she used the method of bracketing which provides the ranges of the above time-adjusted sales price per sq. ft. from $623.74 to $1,073.86, reflecting a median price per sq. ft. of $875.94 based on total building area. When the median sale price per sq. ft. is applied to the Subject Property it results in a current value of $3,355,726 ($875.94 x 3,831 sq. ft. of total building area).

20Based on the above analysis, MPAC’s Representative is of the opinion that current value of the Subject Property is $3,355,000 (rounded).

Appellant’s Evidence in Support of Current Value

21In support of current value, the Appellant’s Representative presents a spreadsheet analysis of six sales located in the immediate and surrounding neighbourhood of the Subject Property. The analysis provided both the actual and time-adjusted sale prices and the Appellant’s Representative relies on the time-adjusted sale prices by utilizing the Direct Comparison Approach to value. The following Table is the analysis of the six proposed comparable properties:

Appellant’s Sales Analysis

6 PROPOSED COMPARABLE PROPERTIES	LOT SIZE (sq. ft.)	TOTAL BUILDING AREA (sq. ft.)	YEAR BUILT	SALE DATE	SALE PRICE (time adjusted) ($)	SALE PRICE (time adjusted per sq. ft.) ($)	Adjustments for proximity to Education facility/light traffic/corner lot by 3 % (+ or -) *
91 Dunloe Road	6,016.5	3,800	1950	2014	2,879,032	757.64	757.64
199 Heath Street, West	8,472.8	3,962	1912	2014	2,467,500	622.79	622.79
199 Heath Street, West	8,472.8	3,962	1912	2015	2,471,040	623.69	623.69
184 Heath Street, West	8,550	4,505	2012	2016	3,312,300	735.25	757.31 *
17 Parkwood Avenue	7,883	4,740	1908	2015	3,600,474	759.59	736.81 *
332 Russell Hill Road	9,629	4,629	1912	2016	2,949,704	637.22	618.11 *
Average	8,171	4,266	1934	2015	2,946,675	689.36	686.06
Subject Property	7,500	3831	1908	N/A	N/A	N/A	N/A

22The above analysis shows that these six proposed comparable properties when the time-adjusted sale prices per sq. ft. were further adjusted for proximity to educational facility, light traffic and corner lot to reflect similar adjustment received by the Subject Property it results in an average adjusted sale price of $686.06 per sq. ft. When this average adjusted sale price is applied to the Subject Property it results in a value of $2,628,295 ($686.06 x 3,831 sq. ft. based on total building area).

23Based on the evidence, the Appellant’s Representative is of the opinion that the current value should be $2,628,280 (correct calculation is $2,628,295).

Finding of the current value of the Subject Property for the 2020 and 2021 taxation years

24Reviewing the evidence presented in support of current value, the Board finds the best evidence are five sales (one sale presented by MPAC and three sales by the Appellant and one sale by both MPAC and the Appellant) which occurred in 2015 and 2016. These five comparable properties are located at 199 Heath Street, West, sold in 2015 at a time adjusted sale price of $2,471,271; at 27 Parkwood Avenue, sold in 2015 at a time adjusted sale price of $4,093,045; at 184 Heath Street, West, sold in 2016 at a time adjusted sale price of $3,312,300; at 17 Parkwood Avenue, sold in 2015 at a time adjusted sale price of $3,600,474; and at 332 Russell Hill Road, sold in 2016 at a time adjusted sale price of $2,949,704. These five comparable properties were sold at a median time adjusted sale price of $3,312,300.

25The Board finds that the above five comparable properties have many differences in characteristics to the Subject Property in total building area, lot size, types of renovation or no renovation and other locational variables (proximity to educational facility, corner lot and traffic) that would require adjustments, thereby, changing the market evidence to opinion of values. Therefore, the Board relies on the median time adjusted sale price of $3,312,300 and finds this current value represents the best evidence of arm’s length transaction between a willing buyer and a willing seller pursuant to s. 19(1) of the Act.

26In regard to the remaining two sale presented by MPAC at 91 Dunloe Road, sold in 2014 at a time adjusted sale price of $2,879,292; and at 29 Browside Avenue, sold in 2017 at a time adjusted sale price of $4,654,140, the Board did not rely on these two sales because the sale dates are too far removed from the valuation date of January 1, 2016 to provide any meaningful test of current value. Therefore, the Board relies on the five sales that occurred in the shoulder years closer to the valuation date of January 1, 2016.

27Based on the evidence, the Board find the correct current value is $3,312,300.

Issue 2 – Whether there should be an equitable reduction of the current value pursuant to [s. 44(3)](https://www.canlii.org/en/on/laws/stat/rso-1990-c-a31/latest/rso-1990-c-a31.html)(b) of the [Act](https://www.canlii.org/en/on/laws/stat/rso-1990-c-a31/latest/rso-1990-c-a31.html), and, if so, what the amount of this reduction should be.

28Section 44(3)(b) of the Act provides that “the Board shall…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.” In essence, the Board looks to similar lands in the vicinity to determine whether their assessed values are lower than their current values. If so, then it would be equitable to lower the assessed value of the Subject Property by a proportionate amount.

29As stated above, the Appellant’s Representative advises the Board that it agrees with MPAC’s finding that an equity adjustment is required, based on an ASR of 0.90. The Board accepts the median ASR of 0.90 and applies it to the correct current value of $3,312,300 to arrive at an equitable value of $2,981,000 rounded ($3,312,300 x 0.90).

30Based on the evidence the Board finds the equitable value is $2,981,000.

CONCLUSION

31The Board finds the correct current of the Subject Property is $3,312,300 for the 2020 and 2021 taxation years.

32The Board also finds that an equity reduction pursuant to s. 44(3)(b) is required and that the equitable value is $2,981,000.

ORDER

33The Board orders the returned assessment of $3,249,000 be reduced to $2,981,000 for the 2020 and 2021 taxation years.