Unlock property insights: Everything you want to ask as a first-time homeowner

First-time homebuyers face a sharp learning curve when they step onto the property ladder — and the education process doesn’t end after the closing date.

Many firsts await new homeowners. From navigating property taxes and insurance to maintenance and renovations, there’s lots to contend with once you join the two-thirds of Canadians who own a home.

The good news? MPAC, the Municipal Property Assessment Corporation, is an independent not-for-profit organization that assesses the value of every property in Ontario and has developed several tools to help you understand your property assessment, and how it relates to your property taxes. With these tools, first-time homebuyers and current homeowners have a variety of resources at their fingertips to help them navigate the process.  Here’s a roundup of questions from first-time homebuyers (and how MPAC helps answer them).

What’s my home worth?

Ask 10 different real estate experts what your home is worth, and you could get 10 different answers. However, in Ontario, there’s a useful benchmark for property values—for over 25 years, MPAC has conducted assessments for more than 5.6 million properties across the province. Each assessment estimates a property’s market value as of a specific valuation date, and municipalities use these assessments to help calculate property tax rates. Every property owner in Ontario can access MPAC’s free online portal, AboutMyProperty, for detailed information about their assessment. Through this portal, you can also review the data MPAC has on file about your home and compare it to similar properties in your neighbourhood.

How are home values assessed?

While it’s been said that real estate is all about location, four other key factors generally influence the value of a property: lot size, square footage, age (adjusted for any renovations) and build quality. When assessing your home’s value, MPAC compares the property to similar ones that were sold in the area, considering up to 200 factors.

Remember that real estate trends are constantly evolving. Homes may sell for above or below the assessed value, depending on current market conditions and individual circumstances. For example, some sellers may be more motivated than others, and so accept a lower bid.

How are my property taxes calculated? 

Municipalities decide how much money is required to build and operate their community, and then decide on the municipal tax rates and policies. MPAC’s property data is used to determine how much you contribute based on the assessed value of your home and the tax rate. Your property tax is calculated by multiplying your home’s assessed value by the total residential tax rate.

Toronto’s property-tax rate includes the council-approved rate, plus the municipal City Building Levy, which is dedicated to public transit and housing projects, and the provincial Education Tax Rate, used for school funding.

Can I find out what other homes in my neighbourhood are valued at?

MPAC’s online tool, AboutMyProperty, lets you explore your neighbourhood and browse up to 100 properties. From there, you’re able to generate a report with details on as many as 24 homes. This is especially handy if you have questions or concerns with your assessment, because it lets you see how comparable homes are valued. If you disagree with your assessment, you can file a free request for reconsideration using AboutMyProperty.

Will renovations affect my property taxes?

Whether you’ve purchased a fixer-upper that needs some TLC right away or you’re planning a reno in the future, you should be prepared for the potential tax implications. MPAC may re-assess your property based on improvements such as an addition or finished basement.

How does MPAC keep up to date on renovations?

With the exception of certain minor renovations, such as painting or installing new flooring or cabinets, many home-improvement projects require homeowners to obtain one or more building permits, which are issued by the local municipality. If a homeowner obtains a building permit, the municipality notifies MPAC, who may reach out to learn more about the changes and update the property assessment, as needed.

Is my neighbourhood hot (or not) for real estate?

Chances are your home is your biggest investment, so it pays to know about local market conditions. This can help you make better-informed decisions about whether or not to sell, how competitively to price your home if you do choose to list it, and more.

MPAC’s Property Pulse Dashboard gives users access to monthly home sales data and in-depth market insights. Meanwhile, the interactive housing inventory map breaks down the share of homes by specific price ranges in communities throughout the province. Available to everyone, the inventory map is a great place to start your next house hunt once you’ve set your budget.

Learn more at mpac.ca/valuematters.