Appraisal Value vs Assessment Value

 

taxesWe frequently are asked from home owners (as well as some buyers) what is the difference between an appraisal and the assessment value of a property?

The two are completely different and are used for different reasons. They have no correlation to each other at the current time.

St. John’s Property Assessment Value

The municipality you live in will have an assessed value on your home. This value is how they calculate your annual property tax. Assessment figures however, are nothing more than a gauge or price line guide for a city or town to collect an appropriate amount of taxes from those that reside in the community. The official nature of this may encourage you to rely on the assessed value of your home for pricing purposes, which could be a big mistake. Real Estate assessed value almost always has no correlation to current market value. One of the biggest problems with the assessed value is that it is often not current. Municipalities will usually assess value once every 1-3 years. The market can change substantially during this time frame.  VERY rarely is your property assessment value over the appraisal or market value.  If it is, there are measures you can take for a re-assessment of your home. In St. John’s The ‘Assessment Act 2006’ is the legislative authority governing assessment and taxation in the City.

How are the property taxes calculated in St. John’s?

For the taxation year 2015, residential property tax is calculated at the rate of 8.1 mils, or 0.81 per cent of a property’s total assessment. A property with a total assessed value of $100,000 would be charged an annual property tax of $810, calculated as follows:

Assessed Value = $100,000
X Mil Rate = .0081 (8.1 Mils)
Annual Tax = $810

The water tax portion is a separate flat rate of $615 / yr

To search for your property assessment value for St. John’s click here.

To search for all other municipalities outside St. John’s visit the Municipal Assessment Agency or click here for the 2015

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Appraisal Value

An appraisal is a method of valuation that compares similar properties in a similar area usually within a shortened time frame.  This is similar to a REALTORS® Comparative Market Evaluation (CMA) but not as in-depth. While both are using essentially the same information, they can vary depending on the property, location and appraiser/REALTOR®.  Sellers can be very fixed on this figure, especially when it benefits them.  (think refinancing) The problem with a high appraisal value is that it can be an unreliable means of what the value really is today’s market. Nothing worse then over pricing your home to list.  Just because you have listed your home with the an appraisal in place or not, true market value is what a buyer is willing to give and a seller is willing to accept.

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Curious to know what your home is worth?

Ask us about a FREE no obligation market evaluation on your home

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7 New Years resolutions if you are selling your home this year

 

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The New Year is a time for resolutions. If you’re thinking about selling your home in the St. John’s real estate market, here are some resolutions that could help boost your chances of a quick sale.

1. “Avoid drastic design changes” – Unless you plan to turn your bold color palette into a more neutral one, then it’s best not to try and anticipate what buyers want in design and décor. The best approach to freshening up your home for sale is to simplify and depersonalize the look and feel so that potential buyers can picture building their own lives there. If you think repainting a bright purple wall, replacing an old toilet or buffing and restaining kitchen cabinets would help the home sell, by all means make these types of updates. Just be sure to keep your personal preferences in check. Your real estate agent can help you prioritize and remain objective.

2. “Stop neglecting the drippy faucet” – This applies to any repairs you might view as minor but actually could be a symptom of a larger system problem. Addressing things like plumbing leaks, poor ventilation and cracks in walls helps everyone avoid surprises from the inspection report and avoid the delay or even cancellation of a sale. When you have the information, you can either make the fixes or work with your agent to adjust pricing during negotiations with the buyer.

3. “Price my home reasonably” – It’s understandable to think your home is the best on the block and worth more than all the others – especially if you’ve invested in key upgrades and remodels. And, frankly, you might be right. But the only way to truly know is to consider recent sales of comparable homes in your area. Your real estate agent can provide you with the latest information and help you list at a competitive price that’s appropriate for your area and the local real estate climate.

4. “Make my home inviting” – This starts with creating curb appeal. The condition of your home’s exterior is a big part of getting buyers in the door. Maintaining the yard, sweeping the porch and driveway, replacing the tattered welcome mat, replacing missing house numbers, and removing clutter all are things that can help improve curb appeal.

5. “Thin out the clutter” – The best time for making tough decisions about what stays and what goes is BEFORE you put your home on the market. By the time the for-sale sign goes up, the home should be clutter free. You can either toss things you don’t want, sell these items, or move the more personal ones to storage. The types of items to remove include your prized knick-knack collection, clothes overflowing from the closets, and family photos. You want all closets and cupboards to appear as spacious as possible. When they’re jam-packed, it gives the impression that storage is limited even if that’s not the case.

6. “Clean like I’ve never cleaned before” – Think about under, behind, around and between. It’s easy to focus on cleaning the major surfaces, high-traffic areas, and areas that are visible. But what about the dust on top of the refrigerator? How about the slats in the window blinds? Have you cleaned the cabinets under the kitchen or bathroom sink recently? Did you notice the cobwebs behind the guest-room door? Look high and low for the dirt.

7. “Nail down my next step” – Don’t let your new plans and new place get lost in the shuffle of selling your old place. Determine where you’ll go next before your home goes up for sale. Are you prepared to move if your home sells quickly? Although it might not be typical, a quick sale is certainly possible. On the other hand, are you prepared if your home doesn’t sell quite so quickly? Be sure to talk with your real estate agent about your relocation needs and timeline.

(source: http://www.remax.com/c/housing-blog/blog-post/7-new-years-pledges-for-home-sellers)

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Two Benefits of a Pre-Sale Home Inspection

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Your home probably has dozens of great features that are going to help it stand out and sell faster. Perhaps it has a cozy sunken living room  or an equipped and smartly decorated kitchen that Rachel Ray would envy. Maybe its the location in a desirable neighbourhood or a wired detached garage.

All these things will help.

But there’s another selling feature you should consider adding: a pre-sale home inspection.

A professional home inspection is usually done on behalf of the buyer before the deal to purchase a property is finalized. In fact, you can expect almost all offers to purchase your home to be “conditional upon satisfactory home inspection.” However, there are two good reasons why you, as the seller, should get the home inspection done:

Reason #1

A professional inspection can identify problems that might otherwise thwart the sale.

Say, for example, you get a great offer but the buyer’s home inspector discovers a minor crack in the foundation. That might be enough to jeopardize the deal. However, if you had a professional inspection done, you would have had the opportunity to get that problem fixed in advance of the offer.

Reason #2

Informing potential buyers that a professional inspection has been done is a great selling feature. It demonstrates to buyers that there are no hidden problems with the property, which gives them more confidence to make an offer.

Pre-Sale Home Inspections are becoming more and more popular throughout the St. John’s real estate market.  It’s becoming an enticing feature for many first time home buyers.

There are a lot of Home Inspectors throughout the St. John’s area.  Contact us today and we can give you a list of names.

Need more ideas for selling your home faster and for a better price? Contact us!

Graphical Review of the Greater St. John’s Real Estate Market Stats for 2014

 

Below is a graph for the Greater St. John’s Real Estate market for the past 3 years (Jan 2012 to Dec 2014). The number of new listings have increased over the past 3 years and the number of expired listings (properties that failed to sell)  have jumped significantly.  However, the number of listings that have sold in the Greater St. John’s Real Estate market have been fairly consistent.

You can see from the graph the typical seasonal cycle of the St. John’s real estate market.  The listings start to ramp up in the spring and decline as we enter the month of December.  December usually has the highest month for expired listings and conversely the lowest months for new listings which is clearly evident from the graph,

 

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Here is a zoomed in monthly graph for the year 2014.

St. John's Real Estate Graph 2014

 

For additional information on statistics for your area please contact us and we will be more then happy to assist you.