As the name implies, a municipal assessment is an estimate of the value of a property made by the municipality in which the property is located, such as the City of Montreal. This assessment is used for the purpose of calculating property taxes and is carried out by certified appraisers, who use public data as well as information from the owners to determine the value of a property.

It is important to note that assessors do not visit every property in a municipality. They use quantitative data and several advanced software programs to perform their evaluations. As a general rule, the value will be calculated in blocks of comparable homes, which means that the price of the property will be estimated based on similar properties in the area. Among the hundreds of factors used by these appraisers are: location, type of property, lot size, living area of the property, year of construction, number of bedrooms and bathrooms, presence of a finished basement and many others.

However, despite the fact that this evaluation is done by professionals in the field, it represents a rough estimate rather than a sure value.

Above all, it is important to know that the municipal assessment is valid as of July 1st, 18 months before the city’s assessment roll comes into effect, and is only reproduced every 3 years.

Thus, it represents a past value and is not current information in the real estate market, which is in constant movement. For example, disruptive factors such as rising property prices, rising interest rates or the onset of a global pandemic can affect the value of this assessment.

The municipal assessment is therefore not the benchmark for setting a sale price for a property, such as a house, an income property or a condominium. As mentioned earlier, its primary use is to calculate the property taxes that owners will have to pay.

Generally speaking, the municipal assessment is lower than the market value. That said, if a property owner feels that their municipal assessment is too high, they can apply for a review within a specified time frame.

So how do you deduct the value of a property? What assessment should you rely on to determine its fair price?