When looking to invest in a new property, one quickly wants to obtain information about the property’s actual value, its area, year of construction, or past value. Knowing this information allows for comparing it to the selling price to determine if the property has been overvalued, understanding the property taxes payable, or better predicting the future valuation of the property based on its past valuations.
To obtain this information, the municipal assessment roll (or land valuation roll) serves as the ideal database.
What is the municipal assessment roll?
The municipal assessment roll is an inventory of the properties within a municipality. When we talk about properties, this includes both land and buildings. Each year, every municipality is responsible for creating this inventory. Generally, municipalities hire certified appraisers who are mandated to evaluate the value of the properties. In practice, not all properties are assessed every year but rather every 2 to 3 years. Therefore, when consulting the municipal assessment roll, it’s important to check the last date on which the property was assessed.
Who can access the municipal assessment roll?
Everyone! It is public data. While the municipal assessment roll is accessible, not all information is. Personal data (such as the names of owners) is not included in open-source access in compliance with Law 25, related to the confidentiality of personal data. In the public version, you will find the following information:
- General information: geographical code and the year of the assessment roll’s effective date.
- Identification of the assessment unit: the property’s address, its district number, matriculation number, usage, file number, and neighborhood unit number.
- The Owner: the date of registration on the roll, status for school taxation purposes, and registration conditions.
- Characteristics of the assessment unit (the land and the main building).
- Values on the assessment roll: market reference date, land value, building value, total property value (land + building), and the value from the previous roll.
- Tax distribution: category of serviced vacant land, class of non-residential properties, class of industrial properties, sub-category, value distribution, and tax distribution for school purposes.
What is the purpose of municipal assessment?
First and foremost, it helps the municipality estimate the property taxes owed by owners. For someone investing in a new property, the land valuation will allow them to know the actual value of the property they wish to acquire. For example, if an owner sells their property for $500,000 but the land assessment values it at $300,000, and the last assessment was just a year ago, it’s highly probable that the owner is overestimating their property. Conversely, if the appraiser valued it at $600,000, it might be a great deal to seize!
Other information is of interest to real estate investors. By looking at the historical land valuation of a property, one can estimate its future valuation and thus its future selling price. You can also compare a property with neighboring properties; perhaps it is overvalued compared to comparable properties in the vicinity.
How to access the municipal assessment?
Today, major municipalities allow everyone to consult the land valuation roll directly on their websites; otherwise, the municipal assessment database is open-source in the province of Quebec. For example, in the city of Montreal, EvalWeb allows you to enter an address to directly access the most recent land valuation sheet.
Moreover, even though municipal assessments are accessible to everyone, it is necessary to have technical skills to access them today, or to be patient if you want to compare several properties (especially if you want to compare properties from different municipalities).
To facilitate access to the land valuation roll throughout Quebec, one can turn to other tools like CivGEO from Civision. By logging in, you can click on “land valuation table” and select the geographic area(s). You can then enter an address or simply zoom in on the desired area. You just need to click on the points for each building to obtain the information for each building. This avoids having to navigate multiple sites or repeating the same process by entering neighboring addresses. In just a few seconds, you can quickly compare the value of properties over time and against neighboring properties.
Use case
Let’s imagine I want to invest in a property near the University of Montreal, HEC Montreal, and Polytechnique. My goal is to rent these apartments to students and then sell the property in five years.
I would want to compare properties for sale nearby, for example, those located on Avenue Decelles, near HEC Montreal. I then notice that most properties have increased by over 40% since their last assessment. Additionally, when I compare between properties, I see significant disparities. For instance, at 5310 Avenue Decelles, the property is valued at $1.4M for 314m², while adjacent properties are valued between $700,000 and $1M for comparable areas. Purchasing it would be less advantageous. It would cost more in terms of taxes and would be more difficult to make the investment profitable through rents compared to neighboring properties.
Furthermore, the property has three apartments, about 100m² each. This implies a rent that will necessarily be higher and therefore much less suitable for students. Looking around, we find that there are very few properties with small units, smaller areas, and therefore lower valuations. Despite their proximity to the University, it will be challenging to rent them to students. One must then look closer to Boulevard Edouard Monpetit to find properties with medium-sized units around 60m². However, these are properties with numerous units (more than 16 units). The budget for acquiring the property will be more substantial, or one must opt for a single apartment.
Thus, through this example, in less than five minutes, we were able to evaluate the investment opportunity in real estate around the University of Montreal, HEC Montreal, and Polytechnique using the municipal assessment roll before even waiting for a property to be for sale.
