Suburbs stuck with higher tax bills as assessment increases phased in

Many Ottawa residents living inside the Greenbelt face a significant hike in property taxes over the next four years as a result of new provincial assessments.

Most suburban Ottawa residents – those living outside the Greenbelt – will see little or no increase in their property taxes due to reassessment.

These are the major findings of a neighbourhood-by-neighbourhood analysis by of what has happened to housing prices in Ottawa since 2007.

Citywide, home prices have increased on average by about 25 per cent since then. But in some urban neighbourhoods, the average price has soared by more than 40 per cent.

As a rough guide, if your home has increased in value by about 25 per cent in the past four years, your property taxes will continue to be about what they are now – plus whatever city council adds to its net taxation requirements from new spending. Mayor Jim Watson is aiming for a tax increase of less than 2.4 per cent next year.

If your home has increased in value by less than 25 per cent, your share of the property tax burden will go down and you might actually pay less in property taxes.

If your home has gone up in value by more than 25 per cent, be prepared to fork out more in property taxes, while

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considering yourself lucky to have made a good investment in your choice of home and neighbourhood.

DEMAND SHIFTS

Some of the biggest percentage increases in prices are in neighbourhoods that, until recently, were not considered trendy. For example, home prices in the Hintonburg and Mechanicsville area, once a depressed neighbourhood just west of downtown, jumped by more than 43 per cent in the four years between 2007 and 2011.

And in the Queensway Terrace North and Whitehaven neighbourhoods of the “old” west end, the average sale price soared by more than 45 per cent, from about $229,000 to $334,000. Real estate agents say one factor pushing up prices there is the proximity to Lincoln Fields Transitway station, with frequent, rapid service to and from downtown.

Average house prices have increased in every part of the city in the past four years except Rockcliffe, the leafy urban village where many of Ottawa’s most expensive mansions are located. But Rockcliffe is a special case, real estate agents say, because so few homes are sold there each year. One blockbuster sale could change the picture significantly, and there were no blockbuster sales last year.

In 2011, there were 25 homes sold in Rockcliffe at an average price of $1,163,940. That was 6.7 per cent lower than the average price in 2007.

This may not be good news for the uppercrust folks who inhabit Rockcliffe. But it will mean they will get a break on their property taxes for the next four years.

Brent McElheran, an Ottawa real estate agent based in west-end Ottawa, inside the Greenbelt, says: “These numbers indicate that the market continues to be strong within the Greenbelt. They also show that Ottawa has been a fairly stable market over a fouryear period.

“As far as Rockcliffe is concerned, the only factor I can think of is that the city and the community association make it difficult to demolish existing homes, and that could have aided in lowering the average sale price.”