Large, older homes rebuilt into multi-unit condominiums had an impact on property assessments in Oak Bay.
And there have been a large number of these “rebuilds,” said Carol Crabb, Victoria Real Estate Board president.
In the past, those condos were often purchased by investors expecting rental income, or an increase in home prices, to earn them greater income than if they invested elsewhere, she said. However, with the decline in real estate prices, these investors are now not seeing any return and even suffering losses.
Real estate speculators should expect to wait at least 10 years before realizing a solid gain, she said. “It’s always been that way and still holds.”
For Oak Bay muncipality, new construction projects generate additional tax revenue and can have the effect of lessening the tax burden on other property owners, said municipal treasurer Patricia Walker.
Despite real estate board figures showing home prices are declining or holding firm, the average assessed value of homes in Oak Bay and Victoria is higher this year, according to B.C. Assessment figures released this week. Assessed values are lower in Esquimalt, most of Saanich and on the West Shore.
“Housing prices have softened since December 2010, when the average single-family home (in the Capital Region) sold for $647,063,” said Crabb. “In 2011, average prices fluctuated and now rest at $592,582.”
The 2012 assessment figures show the average assessed value of a home in Oak Bay is $887,000, up $15,000 from last year. In Victoria the average value jumped $10,000 to $576,000.
Crabb said assessments don’t reflect work done to homes and differs from the “market value” a home actually sells for if put up for sale.
Selling prices can vary as much as 30 per cent from assessed value, depending on the work done to a home, she said.
Crabb disputed the belief elsewhere in Canada that Greater Victoria is in a housing bubble. She argued that price growth in the region has been steady, with “no significant increases or deceases” in recent years, and “with buyers making rational decisions based on value.”
She pointed to the last quarter of 2011, during which prices have remained virtually unchanged month over month.
“While we were trending towards a buyers’ market, based on both the prices and number of properties for sale, the decline in the number of active listings in December 2011 continues to reflect a balanced market,” Crabb said.
• The deadline for property assessment appeals is Jan. 31. To do so, call 250-479-7131 or email capital@bcassessment.ca.
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