Jan 5, 2011, Seskus: Home value assessment bump a welcome economic signal

It’s time again for that post-holiday ritual that has many Calgarians scrambling for the computer — and I’m not talking about returning those unwanted mail-order gifts.

The city has released their annual property assessment for all Calgary addresses, spurring anyone with Internet access to check out their home and their neighbours’.

While you’re at it, sneak a look at the assessment on your boss’s house. That’s always good fun.

But odds are the number that will matter to you most is the assessment on your property. Is it too high? Has your assessment dropped? Will you challenge it?

Although an increase in your property assessment doesn’t mean a corresponding tax hit, it’s important stuff because it ultimately can impact what you pay in property taxes next year. And we all love taxes, right?

But looking at the global figures released Tuesday, there’s a nugget that has to be viewed with at least some optimism given the economic journey we’ve been on recently.

Calgary home values have risen for the first time in three years, according to the city’s figures, with the typical residential property assessment increasing by eight per cent.

That figure includes single-family homes, residential condominiums, multi-residential apartments and vacant residential land.

Eight per cent is nothing like the staggering increases we saw during the last epic boom, such as the 43 per cent spike we witnessed in 2007.

But it looks a lot better than the four per cent drop we saw in 2009 and the 13-per-cent plunge in 2010.

The eight per cent rise “is a positive indicator for Calgary … particularly given the context that assessments have decreased for the last two years,” explained Ben Brunnen, chief economist at the Calgary Chamber of Commerce.

“This is a positive sign of economic conditions in Calgary and confidence in the Calgary economy.”

The city also reported that the typical single-family home has a median value of $410,000 in 2011, an encouraging increase from $374,000 in 2010.

Now, of course, the new assessments are just a snapshot in time.

Property values are still less than they were in 2009, when the typical house was assessed at $427,500.

And new data from the Calgary Real Estate Board suggest “a full-fledged recovery in the housing market has yet to take hold.”

But when considered with other positive economic signs — like oil prices — the assessment figures contribute to an improving outlook.

“It shows that things are definitely moving in the right direction,” said Dan Sumner, an economist with ATB Financial.

Sumner believes the overall trend in the housing market will gradually improve.

University of Calgary economics professor Frank Atkins says there’s only a couple of clouds on the horizon, one being stubbornly low natural gas prices. “We’re not running out here with boom-time growth, but we’ll be looking solid,” Atkins explained.

So, Calgarians will soon be getting their assessment notices in the mail.

There’s not the same anticipation as with as a Christmas parcel and its probably more difficult to return if you don’t like it.

But at least it’s not fruitcake.

By Tony Seskus, Calgary Herald