Kelowna home values have gone down 1%, but municipal taxes are forecast to rise almost 4%.
Between July 1, 2018, and July 1, 2019, the typical single-family home in Kelowna fell in value to $670,900, according to information from BC Assessment.
It’s the first time since 2014 that home values have declined in Kelowna, and the drop will affect the net worth of most property owners.
Nevertheless, the city plans to increase municipal taxes on a typical home by 3.9%, from $2,069 this year to $2,153 in 2020.
Councillors on Monday got a preliminary look at the 520-page city budget for 2020, and praised it for what they said was its comprehensiveness and easy-to-understand design.
“It’s been a very nice read,” Coun. Ryan Donn said.
“It’s an easy document to go through,” Mayor Colin Basran said. “It makes something fairly complex quite easy to understand.”
Council will review the budget line by line during all-day deliberations set for Thursday. Recent practice has been for council to little change staff’s suggested tax increase.
The city’s provisional 2020 budget calls for a total tax demand of $147.6 million.
One-quarter of all the taxes collected by the city next year, or $38.3 million, will go toward policing and other community safety measures. Seven more RCMP members are to be added to the existing 191-member detachment.
After policing and community safety programs, the next biggest cost centres in the city’s operating budget are civic operations (building services, parks, public works, etc.) at $31.5 million, the fire department at $20.5 million, and debt at $14.3 million.
While the assessed value of a person’s home determines how much municipal tax the owner will pay, there is no direct relationship between annual average changes in valuation and the actual tax demand.
The city says it sets its tax demand based on how much the municipality requires to fund all its operations. The taxation rate is based on a property’s class and the change within that class.
So, in this case, it is the owner of a typical Kelowna home that declined in value between July 2018 and July 2019 by about 1% who will see a municipal tax increase of 4%.
If a person’s home has declined in value by more than 1%, that owner’s tax hike will be less than 4%. Conversely, if the home has increased in value, the owner would expect to see a tax increase of more than 4%.
Homeowners will get their valuation notice from BC Assessment in early January. In the new year, the city also updates its online property tax calculator so individual homeowners can see exactly how much municipal tax they are likely to pay next July.
BC Assessment uses an annual valuation date of July 1 for all properties in the province.
The agency says the average single-family Kelowna home was worth $670,900 this past July, but more recent sales figures from the Okanagan Mainline Real Estate Board suggest the figure is now closer to $680,000.