Low property taxes shown in N.B. real estate ads evaporate for new buyers
CBC
Real estate listings in New Brunswick routinely display property-tax amounts on homes that are several hundred dollars less than what a new buyer would pay, but Realtors insist the practice is not misleading to consumers.
Property taxes can be the second largest expense in owning a home after mortgage payments, and the New Brunswick Real Estate Association says its rules require tax information to be displayed with each listed property for the benefit of prospective buyers.
But listings only show what a current owner is being billed in property tax, not what a new buyer will pay.
"Our Realtor code makes us ensure we have the proper tax information we're using for the property, and that information would be the tax being charged on the property for the current year," said Ryan Davison, president of the association.
That can be an issue for people who are house shopping, because a large percentage of homes for sale in New Brunswick belong to owners who pay discounted property tax amounts that are not available to the next owner.
The New Brunswick government has a policy it calls "spike protection" that slows the growth of property taxes on a house during periods when property values are escalating rapidly.
But that protection, and the tax discount it generates, is for the current property owner only and evaporates following a sale.
In Moncton this week, a listing for a house for sale on Evergreen Drive that has experienced a 107 per cent increase in its assessed value over four years shows its "annual property taxes" to be $3,471.
But that is the discounted, spike-protected amount belonging to the property owner. Taxes on the home for a new owner, assuming the same assessed value, will jump to $4,922.
It is 41 per cent higher than what is being shown to prospective buyers in the listing.
Real estate listings that show property tax amounts on houses that new buyers will not qualify for are now widespread in New Brunswick.
On Monday, Tuesday and Wednesday this week in Moncton, Dieppe and Riverview, 23 houses on their own lots were newly listed for sale. In 16 of those new listings, about two-thirds of the total, property details shown to potential buyers included spike-protected property tax amounts.
On 14 of the houses full property taxes for a new owner will be more than $500 higher than what is listed, including six where the difference is more than $1,000.
Davison said it is the responsibility of individual real estate agents to explain to buyers that property taxes on a home they are interested in could be higher than what is shown in a listing.
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