Dominic Pereira v. Municipal Property Assessment Corporation Region 23, 2024 CanLII 78164

Tribunals Ontario

Tribunaux décisionnels Ontario

Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE:

August 16, 2024

FILE NO.:

WR 186564

Assessed Person(s):

Dominic Pereira; Irma Lissette Rodriguez

Appellant(s):

Dominic Pereira; Irma Lissette Rodriguez

Respondent(s):

Municipal Property Assessment Corporation Region 23

Respondent(s):

City of London

Property Location(s):

1283 Wayne Road

Municipality(ies):

City of London

Roll Number(s):

3936-070-330-04400-0000

Appeal Number(s):

3520276 and 3526360

Taxation Year(s):

2023 and 2024

Hearing Event No.:

784173

Legislative Authority:

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

APPEARANCES:

Parties

Representative

Dominic Pereira

Self-represented

Municipal Property Assessment Corporation

Lena Dantzer

City of London

No one appeared

HEARD:

June 24, 2020 by video conference

ADJUDICATOR(S):

Anita Lovrich, Member Subuola Awoleri, Member

DECISION

OVERVIEW

1Dominic Pereira (the “Appellant”) has appealed the assessment of 1283 Wayne Road in the City of London (the “Subject Property”) for the 2023 taxation year pursuant to s. 40 of the Assessment Act, R.S.O. 1990, c. A.31 (the “Act”). An appeal was deemed for the 2024 taxation year pursuant to s. 40(26) of the Act (the 2023 and 2024 appeals together, the “Subject Appeals”).

2The Appellant argues that the value reflected on the assessment of the Subject Property, at $343,000 for the 2023 taxation year and $327,000 for the 2024 taxation year, is incorrect and inequitable. It is the Appellant’s position that these assessed values are too high, and the Assessment Review Board (the “Board”) should reduce them to reflect a total current value assessment (“CVA”) of between $270,000 and $288,000.

3The Municipal Property Assessment Corporation (“MPAC”) is responding to these appeals. MPAC takes the position that the CVA, as of the valuation day of January 1, 2016, should be $326,000.

4A representative for the City of London attended the hearing but did not make submissions or otherwise participate in the proceeding.

Issues for the Hearing

5At issue in this proceeding is:

1. What is the current value of the Subject Property as of the statutory valuation day of January 1, 2016?; and

2. Is the current value equitable with the assessments of similar lands in the vicinity and, if not, should an equitable reduction be made?

Result

6For the reasons that follow, the Board finds that the current value is $318,000 (rounded) for the 2023 and 2024 taxation years.

7The Board finds that there should be no adjustment in the determined current value in order to make it equitable with the assessment of similar properties in the vicinity.

ANALYSIS

Description of Subject Property

8The Subject Property is a one-storey residential dwelling, in the City of London. It has a total building area of 1,439 square feet (“sq. ft.”), with an effective year built of 1986, and quality of construction of 6.0. The effective site area is 0.24 acres. The basement area is 1,417 sq. ft., of which 232 sq. ft. is finished. There were renovations completed on the Subject Property over a number of years including the windows and kitchen in 2010 and the roof and bathrooms in 2015. MPAC assessed the Subject Property with a 2012 average renovation year.

Issue 1 - What is the current value of the Subject Property as of the statutory valuation day of January 1, 2016?

Applicable Law

9In accordance with s. 44(3)(a) of the Act, the Board must first determine “the current value of the land.” Section 1 of the Act defines current value 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.”

10Accordingly, the Board must first determine what the Subject Property would have sold for in an arm’s length transaction on the statutory valuation day. The valuation day for the 2023 and 2024 taxation years is January 1, 2016.

11In general, the best evidence of current value would be the sale of the Subject Property on or close to the valuation day of January 1, 2016. If no such sale occurred, the Board will consider sales of comparable properties to establish the current value of the Subject Property.

Evidence on Current Value

12The Subject Property sold on June 2021 for $721,111 in an open-market sale.

13MPAC provided evidence regarding the sale of four proposed comparable sales. Sales 1 and 2 are the same property which sold twice within the shoulder years of the valuation day. MPAC performed a time adjustment to reflect what these properties would have sold for on January 1, 2016. The details of MPAC’s property sales are provided in Table 1 below.

Table 1

Property Address

Subject Property 1283 Wayne Road

Sale 1 1372 Collingwood

Sale 2 1372 Collingwood

Sale 3 1186 Byron

Sale 4 289 Griffith Street

Sale Date

August 15, 2016

December 21, 2015

August 12, 2014

August 14, 2015

Time Adjusted Sale Amount

$304,063

$270,648

$309,489

$323,276

Site Area (Acres)

0.24

0.21

0.21

0.5

0.23

Year Built

1960

1958

1958

1956

1954

Effective Year Built

1986

1982

1982

1984

1987

Quality of Construction

6

6

6

6

6

Baths

2

1.5

1.5

1.5

2

Building Total Area (Sq. Ft.)

1,439

1,235

1,235

1,162

988

Basement Area (Sq. Ft.)

1,417

1,215

1,215

1,240

988

Secondary Structures

Basement garage

Detached garage

Detached garage

Shed

Detached garage

Modification

2012 C Reno

2006 C Reno

2006 C Reno

2013 C Reno

2012 C Reno, 2000 A

14MPAC testified that all three properties were either inferior or slightly inferior to the Subject Property, therefore, the Subject Property should sell for more than any of the proposed comparable properties.

15MPAC testified that proposed comparable Sales 1 and 2 are the most reliable as this property is the most similar to the Subject Property. MPAC determined the time adjusted sale price per square foot of Sales 1 and 2, which is $246.20 and $219.15, respectively. It then applied this rate to the building total area of the Subject Property, which is 1,439 sq. ft., to arrive at a range of value between $315,000 and $354,000, and it states that the CVA of the Subject Property should fall within this range. MPAC then used its model and made adjustments to take into account specific characteristics of the Subject Property based on all of its available data regarding the Subject Property, and determined that the correct current value is $326,000, which is within the range.

16The Appellant presented into evidence printouts of MPAC’s “My Neighbourhood – My Favourites” with comparisons of the Subject Property to its neighbours. He specifically referred to two proposed comparable properties, namely 6 Regis Avenue and 1284 Wayne Road. The details of these properties are provided below in Table 2. The Appellant argues that these two properties have similar features to the Subject Property and states that the Subject Property should be assessed the same as these two proposed comparable properties.

Table 2

Property Address

6 Regis Avenue

1284 Wayne Road

Sale Date

May 2015

December 2017

Sale Amount

$295,000

$435,500

Effective Site Area (square feet)

10,125

8,884

Year Built

1961

1961

Quality of Construction

6

6

Baths

1.5

1.5

Building Total Area (exterior square feet)

1,551

1,541

Modification

No

No

Assessed value

$270,000

$288,000

17MPAC argues that it has no record of renovations with respect to the two comparable properties presented by the Appellant and thus no adjustments have been made to the assessments to account for any such renovations. MPAC states that the proposed comparable properties presented by the Appellant are different in size to the Subject Property and that the Appellant has not time-adjusted the sale prices or made other adjustments to take into account the differences in characteristics between the Subject Property and the proposed comparable properties.

18The Appellant testified that he has been inside 6 Regis Avenue and was able to view the interior and saw photographs of the property at 1284 Wayne Road, and that both were superior properties compared to the Subject Property and both had undergone renovations.

Findings on Issue 1

19In determining the correct current value of the Subject Property, the Board must consider the best evidence at the hearing that represents the amount that the Subject Property would have sold for on the January 1, 2016 valuation day.

20In considering the proposed comparable sales submitted by MPAC, the Board does not rely on Sale 3, 1186 Byron, on the basis that the sale occurred outside the shoulder years. The further a sale is from the valuation day, the less likely it reflects the market on the valuation day. It is also the practice of the Board not to rely on sales outside the shoulder years if there are market tested sales within the shoulder years. The proposed comparable property is smaller than the Subject Property and it has no garage. The Board also does not rely on Sale 4, 289 Griffith Street, on the basis that it is significantly smaller than the Subject Property, with the highest rate per square foot of $327.20 due to economies of scale, which is where the value per acre decreases when the size of the parcel increases, and is thus not a good comparable.

21In considering the proposed comparable sales presented by the Appellant, the Board does not rely on Sale 2, 1284 Wayne Road, as it sold outside the shoulder years of the valuation day of January 1, 2016, which is 12 months on either side of the valuation day. This sale occurred 24 months after the valuation day.

22The Board finds that MPAC’s proposed comparable property Sales 1 and 2, of 1372 Collingwood, and the Appellant’s proposed comparable property sale of 6 Regis Avenue are the most similar proposed comparable sales to the Subject Property. However, both are slightly inferior to the Subject Property, which has superior features. The Subject Property’s site area, total building area, and basement area are larger than MPAC’s proposed comparable Sales 1 and 2. The Subject Property has two full bathrooms while MPAC’s Sales 1 and 2 has 1.5 bathrooms. Furthermore, the Subject Property’s original and effective year built, including its renovation year is newer than the property relating to Sales 1 and 2. 6 Regis Avenue, although also one of the most similar proposed comparable sales, is older than the Subject Property with an original year built of 1961. The Appellant did not testify that he inspected the property prior to its sale in May 2015 and did not specify when the renovations took place. As such, the Appellant did not provide evidence that the renovation took place prior to the sale, and it is not clear if the sale price reflects a renovated property. The property has fewer bathrooms, but a fairly similar lot size and building size. Therefore, the Board finds that the Subject Property’s current value should be higher than MPAC’s Sale 1, MPAC’s Sale 2, and higher than 6 Regis Avenue.

23Applying the time adjustment factors submitted by MPAC to the sale prices of the three comparable sales, the time-adjusted sale prices per square foot of MPAC’s Sales 1 and 2 and 6 Regis Avenue are: $246.20, $219.15, and $197.23. The average time-adjusted sale price per square foot is $220.86. When this value is multiplied by the total building area of the Subject Property of 1,439 square feet, it provides a value of $317,817. The Board notes that this value is within the range of value submitted by MPAC. Taking into account the finding that the Subject Property’s current value should be higher than MPAC’s Sales 1 and 2, as well as 6 Regis Avenue, the Board finds that the correct current value of the Subject Property is $318,000 (rounded).

Issue 2 - Is the current value equitable with the assessments of similar lands in the vicinity and, if not, should an equitable reduction be made?

Applicable Law

24Section 44(3)(b) of the Act mandates that, after determining current value, 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.”

Evidence on Equitable Adjustment

25The Appellant submitted printouts of MPAC’s “My Neighbourhood – My Favourites” with comparisons of the Subject Property to its immediate neighbours. The chart included the assessed values of other properties in the neighbourhood, including 6 Regis Avenue and 1284 Wayne Road.

26The Appellant argues that an adjustment is required, and his property should be assessed the same as 1284 Wayne Road and 6 Regis Avenue, namely, between $270,000 and $288,000 because those properties are the most similar to the Subject Property.

27MPAC provided an equity analysis report reflecting an Assessment to Sales Ratio (“ASR”) analysis. The ASR of a sample of sold properties is often used as a tool to determine if a property in the vicinity is assessed below its current value. If sold properties are being assessed below their current value, as demonstrated in an ASR less than 1.0, a reduction in the Subject Property’s assessment below the correct current value may be required to make the subject assessment equitable with the assessments of similar lands in the vicinity. The ASR is determined by comparing the assessment as returned to the time-adjusted sale price, expressed as a mathematical ratio. MPAC takes the position that equity is achieved if the median ASR falls between 0.95 and 1.05.

28MPAC relies on the sales of 30 single-family detached residential properties (not on water) that sold between January 1, 2015 and December 31, 2016 within 1.5 kilometres of the Subject Property. MPAC testified that the analysis reveals an ASR of 0.98, which means that similar properties in the vicinity have been assessed at or near their current values and an equity adjustment is not required.

Findings on Issue 2

29MPAC presented the best evidence to determine whether the current value as determined by the Board requires an adjustment for equity.

30The Ontario Divisional Court in Municipal Property Assessment Corporation v Loblaw Properties Limited, 2017 ONSC 1299, (“Loblaw”) determined at para. 23:

The reference to "many points of comparison" is of interest because it mirrors wording used in a later judgment of this court, namely, Trizec Equities Ltd. v. Ontario (Regional Assessment Commissioner, Region No. 27), [1988] O.J. No. 182 (Div. Ct.). In that decision, Saunders J. was faced with the same issue, that is, what constitutes similar properties. He referred to the decision in Downtown Oshawa and found that, based on that decision, the Board was required to "consider all points of comparison". Saunders J. then concluded on the issue by saying:

All points of comparison must be considered. The Board must make a factual finding based on such a consideration. One point of similarity such as use may be, but is not necessarily, determinative. Some similarities may be overridden by other characteristics and some differences may be subordinated.

31An equitable reduction should only be made where there is clear evidence to support that such a reduction is warranted. In choosing which properties are “similar properties”, the Board must consider all points of comparison.

32MPAC has provided evidence of property sales of 30 residential properties within 1.5 kilometres of the Subject Property which sold between January 2015 and December 2016. This selection provides similar properties as the Subject Property, in terms of the location, nature, and use of these properties. MPAC provided a more representative sample size than the Appellant’s two assessments of two properties, which is preferred and will provide a general level of assessment of similar lands in the vicinity.

33The Board agrees with MPAC that a median ASR of 0.98 demonstrates that similar properties in the vicinity have been assessed at or near their current value, therefore an equity adjustment is not necessary.

CONCLUSION

34The Board finds that the current value of the Subject Property is $318,000 (rounded) for the 2023 and 2024 taxation years.

35The Board finds that there is no evidence to support a reduction in the current value to make the current value equitable with the assessments of similar lands in the vicinity.

ORDER

36The Board orders as follows:

a. for the 2023 taxation year, the assessment of the Subject Property is reduced from $343,000 to $318,000; and

b. for the 2024 taxation year, the assessment of the Subject Property is reduced from $327,000 to $318,000.