A sprawling luxury mansion in West Vancouver, valued at $22.2 million by BC Assessment, has had its assessment upheld by the Property Assessment Appeal Board. The owner, Holborn Group of Companies, a prominent B.C. developer, had argued for a lower valuation of $14.7 million for tax purposes.
Key Takeaways
- The Property Assessment Appeal Board ruled that the $22.2 million assessment for the West Vancouver mansion is accurate.
- The owner, Holborn Group of Companies, failed to provide sufficient evidence to support their claim of a lower market value.
- The board considered factors like property size, location, and market conditions but found the owner's arguments unsubstantiated.
The Appeal Process
Holborn Group of Companies contested the $22,207,000 assessment for their property at 1669 Marlowe Pl., which includes a nearly 20,000-square-foot Italian/European-style residence built in 2003. BC Assessment had valued the improvements at $12,311,000 and the land at $9,896,000.
An agent for Holborn presented arguments suggesting the luxury real estate market in West Vancouver had peaked between 2016 and 2018. They cited various factors, including new taxes and restrictions on capital outflows from China, as reasons for a significant decline in luxury property sales volumes and prices. However, the board found these claims to be anecdotal and lacking supporting market data or empirical evidence.
Board's Reasoning
Panel chair Bruce Turner noted that while the observations about market trends were interesting, they were not substantiated. Without verification, these claims could not lead to a reliable estimate of the property's market value.
Holborn also argued that a covenant restricting development at the rear of the lot, which would prevent the construction of an outdoor pool, should lower the property's value. However, Turner reasoned that since the existing home and improvements already occupy 33% of the three lots—the maximum allowable—this covenant would not impact the property's value.
Comparable Sales and Final Decision
Turner acknowledged the difficulty in assessing luxury properties due to a smaller number of sales. He observed that the comparable properties submitted by both BC Assessment and Holborn had widely varying characteristics and sales prices, ranging from $7.2 million to $22.5 million. The Marlowe Place property and home were noted as considerably larger than the suggested comparables.
Considering an average sales price of $1,409 per square foot for the comparables and acknowledging the "economies of scale" and the age of the Marlowe Place home, Turner deemed it reasonable to assess the home at $1,200 per square foot. This calculation suggested a market value of approximately $23.8 million, exceeding BC Assessment's valuation. However, because Holborn had not been put on notice that their appeal could lead to an increased assessment, Turner decided to leave the valuation at the original $22.2 million.
