Every January, homeowners across Kelowna and the Okanagan receive their annual property assessment notice from BC Assessment. It’s a moment that often brings a mix of curiosity and confusion. While the notice provides an official number, it frequently raises a critical question: is that what my home is actually worth?

As local real estate experts, we know that understanding the answer is vital for every property owner. The difference between your assessed value and your home's true market value can be significant. Relying on the wrong figure can lead to costly mistakes. Let's explore the two types of valuations, why they differ, and which one you should use for your financial decisions.

‍

The Purpose of Your BC Assessment

BC Assessment is a provincial Crown corporation with a single mandate: to establish the value of properties for taxation purposes. The figure on your notice is what your local municipality, like the City of Kelowna, uses to calculate your annual property taxes.

A key fact to remember is that this assessment reflects the estimated market value of your home as of July 1 of the previous year. This six month or greater lag is significant. As the Kelowna market can shift quickly, the assessed value is often outdated by the time it arrives in your mailbox.

Furthermore, BC Assessment uses a mass appraisal system. This process relies on computer models and market data without an appraiser physically visiting your home. It does not account for the specific condition of your property, recent renovations, or unique features that a buyer in the current market would value.

‍

The Role of a Professional Home Appraisal

A professional home appraisal, or market value appraisal, serves a completely different purpose. It is a detailed, independent opinion of your property's value conducted by a certified appraiser for financial and legal transactions.

In Kelowna, you will need a professional appraisal when you are:

• Selling your home to set a competitive and accurate list price.
• Refinancing your mortgage, as lenders require a current valuation.
• Dividing assets during a divorce settlement.
• Calculating capital gains for the Canada Revenue Agency (CRA).
• Settling an estate, which often requires a specific historical valuation.

An appraiser conducts a thorough onsite inspection, analyzes the interior and exterior condition, and compares your home to similar properties that have sold recently, typically within the last 90 days. This process provides a precise snapshot of what your home is worth in the current market.

‍

Why the Difference Matters in the Okanagan

The gap between your assessed value and market value can be substantial. For example, your BC Assessment might value your Kelowna home at $940,000 based on last July's market. However, if you have since completed a major kitchen renovation and the market has strengthened, a professional appraisal might determine its current market value is $1,050,000.

This difference is not just academic. If you were selling an investment property, that extra $110,000 in value would directly impact your capital gains tax calculation. Using the lower assessed value would be a significant error. An accurate appraisal provides a defensible valuation that financial institutions and the CRA recognize.

‍

Know Your Home's True Worth

Your BC Assessment notice is an important document for understanding your property taxes, but it is not a reliable tool for making financial decisions. For that, you need to know your home's current market value.

A professional REALTOR® can provide you with a Comparative Market Analysis (CMA). This is an expert evaluation of your home's worth based on today's market conditions and recent sales in your Kelowna neighbourhood. It is the most accurate way to understand your property's value when you are considering a sale.

‍

If you have questions about your home's value or are planning your next move, contact Coldwell Banker Horizon Realty. Our team has the local expertise to provide the clarity you need to act with confidence.