The following guest column was submitted on behalf of Carmelo Lipsi, who is the vice-president of valuation and customer relations, as well as chief operating officer, for the Municipal Property Assessment Corporation (MPAC). MPAC administers property assessments and appeals of assessment in the province of Ontario.
Barrie has been on a rapid growth trajectory, establishing itself as one of Canada’s fastest-growing municipalities.
By 2051, the city's population is expected to reach 298,000, an increase of approximately 40 per cent compared to Statistics Canada’s 2021 census data.
To manage this growth and ensure the housing supply keeps pace, the city has pledged to facilitate the construction of 23,000 new housing units by 2031.
With the Bank of Canada’s recent interest rate cut and the Consumer Price Index rising to an annual rate of 2.9 per cent in May, the housing market continues to evolve. There is considerable speculation about the ideal time to buy or sell, which can vary for everyone.
By helping Barrie residents understand their property assessments, we can empower both current and future homeowners to make informed decisions when it’s time to purchase or sell a home.
Value matters
For many Ontarians, the place they call home is more than just a dwelling. It’s a financial investment and, for many, it’s often their single greatest asset.
According to data released earlier this year by MPAC, just over 43 per cent of properties in the city of Barrie were valued between $500,000 and $750,000 in 2023, while nearly 40 per cent were valued between $750,000 and $1 million.
MPAC’s assessment data provides insights into homeowners’ properties and how they compare to others.
AboutMyProperty, a free online tool, is available to every property owner in Ontario, where homeowners can access detailed property information, learn about how their property was assessed and compare their property value to those in their neighbourhood.
If homeowners disagree with their property’s assessed value, they can file a request for reconsideration before the deadline, which can be found in AboutMyProperty.
Understanding value also helps homeowners and first-time homebuyers anticipate and budget for tax obligations. Property taxes are calculated based on assessed home values at a tax rate based on the funds municipalities determine are needed to build and run thriving communities.
How assessment value and market value differ
According to a report from the Barrie & District Association of Realtors, Barrie’s average sale price in 2023 was $749,773, while the average sale price across the broader Simcoe County was $846,278.
Understanding the distinction between a property's sale price and its assessed value is crucial. The sale price of a property is the final dollar figure negotiated and agreed upon by two parties. Buyers and sellers are motivated for different reasons, impacting how much they are willing to pay for a property. Prices might also be influenced by the supply and demand of property, length of time on the market, and individual preferences.
A property’s assessed value is a calculated estimate of its worth based on the results of appraisal and analysis of all sales transactions in each market.
How residential property value is assessed
There are more than 200 factors considered when assessing the value of a property, but the five key elements homeowners and prospective buyers should know include:
- Location — the neighbourhood where a home is situated significantly influences its market value. The desirability of the area often plays a crucial role in determining how much a buyer is willing to pay
- Lot size — the area of a property’s lot is calculated by multiplying the frontage by the depth
- Total square footage of living area — the exterior of the home is measured to determine the total area of the building. This measurement excludes areas such as basements, decks, porches or garages
- Building age — property value is adjusted to reflect renovations or additions, considering the actual condition of the house rather than its original construction year
- Construction quality — the type of building materials used and the quality of finishes also play a role in determining a property’s assessed value.
Property assessments versus property taxes
Property assessments are available to both homeowners and local government. In fact, municipalities use these assessments to calculate property taxes.
When it comes to property taxes, each of Ontario’s municipalities decide how much money is needed to support its community services and infrastructure, including maintaining hiking trails like the North Shore Trail at Johnson’s Beach, and funding fire services.
The municipality then determines the municipal tax rate – this is done by dividing the total funds needed to maintain the city by the total value of properties.
In Barrie, the current residential property tax rate is 1.35 per cent. These taxes are then collected from each owner by applying this rate to their property’s assessed value.
While property assessment and tax can be complex, understanding this information will empower current and prospective homeowners to make informed decisions about their property.
For more information about home values, visit mpac.ca/valuematters.
