Property Taxes

Up until today, we have been going on the assumption that our property taxes would be about $2,000/year - this is based on what our builder had been telling as about property in the area - so our budget has reflected a monthly amount of $167.  Thinking about it, this was probably a good guess based on the house before upgrades and on the 2010 tax rate.

I had some time to call the City's tax office today and learned quite a bit about how the taxes are calculated/adjusted.

When a new home is built, the taxes are based on purchase price of the home (including GST, down payments, and upgrades - not including CMHC insurance) - that would make our approximate tax bill for 2011 $2,104 - that divided by 12 gives us monthly payments of $175. I'm not sure what the 2012 tax rates will be, so this is the value we've used to sign up for monthly payments to the city.

Because we only owned our home for 6.57% of the year, we we owe approximately $138 for the 2011 year - the payments above are for 2012 while we wait for the adjustment notification that we and our home builder will have to sort out. 

When the new property assessments come out in the spring, we'll find out the City's assessment of our homes value and adjustments will be made for payments from June through to December.  That could mean that for the remainder of the year our tax bill goes up, or down, depending on if we over or under guessed when signing up for the monthly billing cycle.

You might asked why we signed up for the monthly payments instead of paying annually.  Unlike vehicle insurance, there is no interest charged for setting up a monthly payment program vs paying in a lump sum - the only drawback is that we lose out on a very slight amount of interest if we had been putting the money away in a savings account when the annual bill came due.  For us - with home ownership being so new, we thought the monthly plan suited us best.

If you are a homeowner, do you pay your property taxes annually or monthly?  Why?


  1. Ours are paid along with each mortgage payment, and then the bank submits them to the town. With my last house I paid the town directly.

  2. We pay with each mortgage payment too. I can't imagine saving up and forking over $5000 for one year's worth of property taxes in one payment! It's much more manageable at $420/month! Here we have the option of paying monthly or paying 4 times a year.

  3. We pay ours along with each mortgage payment also.

  4. I have a monthly deduction set up with ING that totals our annual expenses for property taxes, home & auto insurance, vehicle registration renewals and Christmas spending. Then, as things come due during the course of the year I just cut a check. I really, really (I mean really) hate gaving companies access to my bank account. You'd be surprised just how often a mistake can be made. The only thing I have on auto debit is my mortgage, RRSP & ING deductions. This works for us, but it wouldn't for everyone.

  5. We pay annually. Our only option since we don't escrow is to pay annually. They don't set up property taxes here monthly. You can set it up on escrow where you pay your mortgage company monthly and then they will pay it annually.

  6. I pay it annually for efficiency. I have an apartment so it's not a big deal to save up.

  7. I am not a home owner but I feel I would have opted for the monthly payment as well.

    Happy New Year!

    I wish you all the best and continued success for this year.

  8. Ours go into an escrow account and will be paid with our mortgage. I like it that way!

  9. I pay the taxes monthly to an escrow account with my mortgage. Although I hate that my monthly bill is so high, I can't imagine paying it over in one lump sum.

  10. We use the TIPPS program and pay every month. I like it. It makes it much more manageable plus it costs the same.


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