THUNDER BAY — Ontario's Assessment Review Board has agreed that a city home should be taxed at a level tens of thousands of dollars less than its current assessment because it needs a lot of repairs.
However, the board said it heard no evidence to support the owner's contention that, because the house sits too close to the property line, it would have to be moved in order to fix the foundation. According to the board's recent ruling, the owner had maintained that this presents "a potentially extraordinary cost" to her.
The two-storey home was built in 1925 and renovated in 1985. Taking the renovations into account, the Municipal Property Assessment Corporation considers the "effective year" it was built to be 1963.
The owner told the board the house has major structural issues arising from the deteriorated foundation, and that the needed repairs are so extensive that she was denied assistance from the province's Northern home Repair Program in 2009.
In testimony, the MPAC assessor described how she had examined sales information for six comparable homes in the vicinity before initially valuing the subject property at $133,000.
She ultimately reduced the assessment to $102,000 after conducting an inspection.
However, having placed the home's construction quality at 4.5 out of 10, the assessor also decided to apply a reduction of $60,000 as "cost to cure," the sum required to fix something that is depressing the value of real property.
She recommended to the Assessment Review Board that the cost to cure be deducted from her initial current value assessment of $133,000, resulting in a current value of $73,000.
The $60,000 cost to cure is the average of two contractors' estimates the owner obtained in 2009, but did not include moving the house.
At an appeal involving the same property in 2013, the review board ordered that the value of the home be reduced by $60,000.
In the recent hearing, the owner testified that repairs had not been carried out and that the home is, if anything in worse condition than it was at the time of the hearing five years ago.
Although she had not obtained any updated repair estimates, she asked that the cost to cure be carried forward.
In agreeing to set the value of the property at $73,000 for the 2017 and 2018 property taxation years, the board noted that "In a case such as this, where compelling evidence of deterioration in the repair of the subject property detracts from the potential sales value, the Board can take these factors into consideration."
It said MPAC had confirmed the poor condition of the home, "and did not object to the Appellant's use of the somewhat outdated repair estimates."
But, given the lack of evidence on the necessity of moving the home away from the property line to make repairs, it ruled that the cost to cure is only the cost of repairing the foundation, and repairing the floors and wiring that would be affected by the foundation work.
