Vancouver’s Property Tax Windfall…

Is About To End.

photo credit: SqueakyMarmot

This year, with the rise of Vancouver property values, property taxes should ONLY increase by only 14.2% (that’s inflation x 700%).

Vancouver budget director Annette Klein said the 1.23-per-cent tax increase approved by city council was not reflected for single-family dwellings because their assessed values shot up 30 per cent.

Don’t you think they should have been able to drop taxes with assessments going up by an average of 30%?

I’d like to share the lesson I learned in Florida – because it parallels Vancouver’s situation…

In Florida, the the property tax rates never really went up, but our assessments rose an average 25-35% each year, for 4 years. In my case, that translated taxes going from $3,500 to $10,000 in 3 years.

This windfall gave Ft Lauderdale county approx. 1 billion more in revenue each year, without having to raise taxes.

When house prices dropped (crashed), I expected to see my taxes go down. They dropped $150.

The reason is, like gas, they rise fast on the upside… and drop painfully slow on the downside.

The reason I was given was that although prices went down by 25%, the cut-off for setting the assessments is 12 months before the tax bill is set, so the lower assessments would take a year to hit my tax bill.

Now it’s been almost 2 years since my Florida home price has spiraled down, I am hoping (not holding my breath) that my taxes will come back to where they started off.

Well run cities (i.e Calgary) determine property taxes by the cities operating costs. Once the budget is set, they add up all the assessed property values and divide the budget into the gross. This results in everyone paying their fair share based on property value, and the city becomes accountable to budgeting…

… Not by counting on a windfall gained from raising property taxes.

There’s a lesson (or warning) to be learned. Cities quickly get addicted to increasing revenues, and lose all accountability. Can you  notice any difference in Vancouver after all these years of property tax increases many times greater than inflation??

When the revenues go down, all hell will break loose…

We’ll hear about the drastic cuts to police, parks, libraries, health, teachers, etc. It will sound like an Armageddon.

(Remember how many cops, teachers, etc. they have actually added…)

It’s all BS, and a great cover to keep blowing your money… money they shouldn’t have received in the first place.

With property prices now set to fall significantly in Vancouver, don’t say I didn’t warn you…

…