City assessor Eddie Lee said Calgary's condo market values were 'catching up' to other housing options
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Calgary condo owners will likely see the most significant hike on their property tax bill in 2024, after their property values rose more than other housing types last year.
The city mailed out more than 580,000 property assessment notices on Wednesday, and the documents are expected to land in Calgarians’ mailboxes within the next two weeks.
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Based on market values calculated on July 1, 2023, and the physical condition of the property as of Dec. 31, 2023, condos saw the biggest jump in assessed values, with a 17 per cent increase from the previous year.
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The median price of a condo in Calgary is now $295,000, up from $255,000 the year before.
City assessor Eddie Lee said Calgary’s condo market values were “catching up” to other residential housing forms in 2023. He said condos became an attractive option for local homebuyers, based on their relative affordability compared to other housing types.
“We’ve seen greater demand for lower-priced options, such as townhouses and apartment condos, over single residential homes,” he said during a media availability at city hall.
Residential property values up 10 per cent
Though condos led the way, Calgary experienced a 10 per cent increase overall among residential property values in 2023, compared to 12 per cent the year before.
Single-detached home values increased by nine per cent, while multi-residential properties rose by a more modest four per cent due to lower vacancies and higher rental rates.
A typical single residential property in Calgary is now worth $610,000, up nine per cent from $555,000 last year.
The sustained year-over-year growth in residential property values was primarily driven by a surge in net migration, Lee said, bringing an influx of new buyers into Calgary’s housing market.
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“New housing supply was not able to keep up, which caused property values to increase,” he said.
Calgary communities that saw the most dramatic upswings in property values in 2023 (between 10 and 15 per cent, on average) included Point McKay, Spruce Cliff and Skyview Ranche. Lee attributed the high concentration of condos in these communities as a leading reason property values rose so much.
Non-residential properties see three per cent increase
Property values for businesses also rose last year, albeit more modestly than residential.
The values of Calgary’s non-residential properties rose by three per cent overall in 2023, compared to a two per cent uptick the year before.
Industrial properties saw the biggest jump, at nine per cent, while office values remained flat and retail properties rose by two per cent.
Lee said low vacancies, rising rental rates, new developments and healthy investment contributed to the increased values of the city’s industrial properties.
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“Calgary’s economy, transportation and logistical advantages, along with the continued trends in e-commerce demands, have all led to increased property values of Calgary’s industrial market,” he said.
Office values stayed flat in 2023. While reduced capital spending by businesses constrained overall growth, Lee said AA office buildings are now more affordable than in the past.
He also touted the success of Calgary’s downtown office conversion program, noting that more than 1.1 million square feet of office space is slated for residential conversion.
Comparably, Calgary’s retail market experienced a modest gain of two per cent in property values.
“Retail spaces left behind by national brands are gradually being absorbed by new businesses seeking visibility in Calgary’s retail scene,” Lee said. “Many property owners are reinventing their large spaces, resulting in a decreased vacancy for big-box stores.”
Top 10 most valuable properties
On Wednesday, the city released its list of Calgary’s 10 highest valued non-residential properties.
The list looked almost identical to last year’s, with CF Chinook Centre topping the chart with an assessed value of $1.09 billion — a one per cent drop from the popular shopping centre’s previous valuation of $1.1 billion.
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The Calgary International Airport will keep its No. 2 spot in 2024, with an assessed valuation of $961 million, or nine per cent more than last year’s $882 million.
The Bow tower is Calgary’s third most valuable property at roughly $753 million, up one per cent from last year.
The rest of the list is rounded out by Brookfield Place, CF Market Mall, Bankers Hall, Suncor Energy Centre, Centennial Place, Eighth Avenue Place and the Calgary City Centre.
Tax implications
The city uses a revenue-neutral tax formula, which means no additional taxes are collected as a result of the annual assessment process.
The city’s total tax revenues do not change based on assessment value changes, according to Lee. When property values go up, the tax rate decreases, and when values go down, the rate increases.
Assuming a single residential property’s assessed value has risen by nine per cent, Lee said the homeowner should expect to pay slightly less taxes than the year before, as that figure is lower than the 10 per cent median increase.
A homeowner whose property value rose by 11 per cent should expect a slight tax increase in 2024.
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After city council’s approval of its 2024 budget adjustments in November, the owner of a $610,000 single residential home can expect to pay $16 more each month in property taxes.
However, property tax rates won’t be finalized until the spring. Lee noted city council still needs to pass its property tax bylaw, which is typically approved in April after the provincial government’s property tax share is determined by its springtime budget.
Last year, he said, more than one-third of residential property tax collected by the city went to the province.
Customer review period
Calgarians who disagree with their assessment notice have a few ways to dispute it.
The city’s customer review period is now in effect until March 11. Homeowners can visit calgary.ca/assessment to access an online assessment search tool to review their residential property’s details and compare their property with others in their area.
There’s also an online question-and-answer session with the city assessor on Jan. 16, from 7 to 8 p.m., with registration at the same link.
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2024-01-03 22:18:45Z
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