The Municipal Property Tax System (MPAC) provides you with an assessed value that is then used by the city where you reside to collect realty taxes on your unit. ( or your home ) Most of the time the MPAC assessment is based on key neighbourhood indicators; other properties like yours that have sold recently, or alternatively based on square footage of your home, square footage of your lot, recent improvements and water spigots. (Spigots are water outlets) Unless they have come out and specifically reappraised your property.
With new condos your value is not only the square footage of your particular unit but also the collective value and footprint of your entire condominium complex. When they sold you that unit (approximately 3 years ago) The taxes are not yet assessed because no one has purchased or closed on a unit. Once that starts happening, then there will be sold values to set as the property value standard.
If you are purchasing a unit, and you are paying cash or with a low mortgage, [less than 75% of the purchase price] the bank may not require you to remit a tax portion on account for the estimated property taxes on your suite. It could be a year or two after your move in date when the actual property tax assessment arrives. It could also be a few years before your condominium unit is registered and you will be paying the Phantom Mortgage until Registration unless you advised the builder you will pay at Interim Closing or Occupancy Date.
At that point in time you will have a bill which is an adjustment for taxes from the registration date of the condominium corporation. This tax bill needs to be dealt with in short order to avoid additional charges or penalties. Then your tax bill will be in 6 installment per year, 3 in the spring based on last years budget, and 3 in the fall based on teh new budget post April 1st 2012.
If you have a mortgage exceeding 75% - 80% of your purchase price typically you have been making pro-rata payments to your tax account based on the [proposed] expected realty taxes. This account would now be reconciled with the the tax bill as received by your mortgage company and you would see modest revisions to your payment amount based on the actual tax component.
As more of our population matures there will be a greater demand for single level living and condominium units will continue to grow in demand and price. Looking for a condo? Love to hear from you... Some great buildings have exceptional pricing.
Add your comments; Do you feel life is good for mature people in a condo? Is a new condo the way to go?
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