2022 assessed value notices are out! And they are showing a 40% jump or more for homes in some of British Columbia’s suburbs. The new data shows the increase up across the province. Some smaller suburbs and communities are hit the hardest.
More affordable parts of Fraser Valley are seeing major increases. In Chilliwack, the average increase is 40% over the past year. In Langley we are seeing increases of 38% while in Abbotsford we are seeing increases of 39%.
When you look at the cost of a single family home in Vancouver, which was already sky high, we are seeing an increase of 16%. This means an approximate average of $2 million. These numbers show how the affordability problem in Vancouver is spreading to other towns.
There may be some serious challenges ahead as these price increases will mean locals can’t buy. Locals won’t be able to purchase as the local income has not increased to these sizable property value increases.
Homeowners will welcome the increases whether they plan to sell or not. But this really is another blow to anybody hoping to get into the housing market. It will also be a major worry for renters as they will be affected too. If you have a leasehold property when the assessed value goes up your annual costs, paid over to the government will increase too.
Retired individuals with recreational properties may not be able to keep their properties since they are on a fixed income. Others on fixed incomes may find they are unable to afford to keep their properties as well.
What’s Needed to Address the Affordability Crunch?
When the assessment is done, there is no differentiation between freehold properties and leasehold properties. To address this affordability crunch that seems to be growing there are a number of factors that come into play. These include demand, supply and financing measures.
There is also the need to look at emerging housing disruptors such as Airbnb and people who own multiple homes. The marketplace is under particular pressure due to the idea of housing for investment rather than for use as a home. And this was before the pandemic hit.
B.C 2022 Assessment Notices
B.C Assessment is the authority within the province that determines how homes across the province are valued. This is done yearly for official records as well as for tax purposes. The current 2022 assessment notices reflect a property’s market value as at July 1st 2021.
B.C Assessment notes the market is still very active, and property owners can only expect to see more of these higher assessments in 2022. Over the past two years, a heightened demand for homes has caused an increase in property values in both traditional hot spots and smaller towns. Across the Lower Mainland area, gains average between 10% and 30%. There were increases of more than 30% in Delta, Coquitlam and Surrey. In Chilliwack, the average worth of single-family properties is $877,000, and in Hope $620,000 up by 45%.
Over in the City of Vancouver, we see where condos have seen increases on the lower end of the spectrum with single digit increases.
Total overall assessments for the Lower Mainland area have increased to $1.75 trillion in 2022, coming from $1.46 trillion in 2021. Over $23.7 billion updated assessments are coming from new construction, property rezoning and subdivisions.
According to the B.C Real Estate Association, 2021 December home sales hit a new high. The average house price is now almost at 1 million dollars, up by 22.1% from November 2020 prices.
Vancouver Island Increases
On Vancouver Island the data is similar with Tofino seeing increases of 42% and Port Alberni up to 47%. The increased demand in homes in smaller cities and rural areas also drives the increase in assessments.
Parksville, Duncan, North Cowichan, the Gulf Islands and Sooke, to name a few, saw 30% increases.
The overall increase for Vancouver Island, according to the B.C Assessment, is $343 billion for 2022, coming from $269 billion in 2021. The biggest increase the region saw was in Peachland, with an increase of 39% in assessments of single family properties from 2021 to 2022.