Residential tax rate in North Bay among highest of 32 Ontario cities -- report

Lower rate does not mean lower bill, city spokesperson says

nugget.ca
Aug. 25, 2021
Michael Lee

An analysis of 32 cities in Ontario has placed North Bay in the top 5 highest property tax rates for 2021.

The review, published in July by LowestRates.ca, a financial technology company based in Toronto that compares rates on products such as insurance, credit cards, mortgages and loans, ranked North Bay second with a tax rate of 1.568182 per cent.

The top 5 ranking includes:

Belleville (1.665845 per cent)

North Bay (1.568182 per cent)

St. Thomas (1.55319 per cent)

Sarnia (1.533293 per cent)

Peterborough (1.448245 per cent)

The company says of Ontario’s 51 cities, it was able to obtain property tax information for only 32, meaning it is not an exhaustive or completely representative list, with the rankings expected to “almost certainly shift” for 2021 as municipal websites are updated.

“Cities with lower-valued homes and smaller populations tend to boast higher tax rates because there are fewer taxpayers overall who are able to contribute,” the analysis points out.

“The opposite tends to be true of cities with higher-valued homes and larger populations; they generally have more flexibility when it comes to setting the property tax rate. However, this doesn’t guarantee that a smaller city will always have a more expensive tax rate. According to MPAC (Municipal Property Assessment Corp.), if your municipality needs additional funds, your property taxes may rise.”

By comparison, the five cities identified in the analysis with the lowest property tax rates were:

Vaughan (0.669976 per cent)

Burlington (0.779583 per cent)

Kitchener (1.106139 per cent)

Clarence-Rockland (1.256262 per cent)

Thorold (1.418692 per cent)

RATES ALONE NOT AN ‘ACCURATE MEASUREMENT’

In a statement, city communications officer Gord Young said the ranking leaves out a “large number of Ontario municipalities because they had yet to adopt their 2021 tax rates at the time of publication.

“It is also important to note that property tax rates alone are not an accurate measurement of affordability and that a lower tax rate does not necessarily translate into a lower tax bill,” he said.

“Because property taxes are also dependent on assessed property value, the average homeowner in North Bay will pay less property taxes this year than the average homeowner in most of the five ‘least expensive cities’ listed in this ranking.”

He noted that in Vaughan, a typical residential property assessed at approximately $891,000 in 2016 -- the assessment year for which 2021 taxes are based -- would see an annual property tax bill about $2,500 higher than that of a typical residential property in North Bay assessed at $222,000.

“As noted in the report, however, cities with lower-valued homes and smaller populations do tend to boast higher tax rates because there are fewer taxpayers overall who are able to contribute. This is something North Bay city council has recognized and is working to address through a number of growth initiatives such as the Growth Community Improvement Program and moratorium on development charges,” Young said.

LowestRates.ca notes that the actual cost of owning a home includes other expenses besides monthly mortgage payments, such as utilities, home insurance and property tax, the latter of which is commonly overlooked.

It says these should be taken into account before deciding to relocate, an idea many Ontarians are embracing.

“If you only factor in your mortgage payment when buying a home, you could be in for an unpleasant surprise if you don’t factor in property taxes, too. If you’re still considering leaving a big city for a smaller one, don’t forget to account for this often glossed-over cost of homeownership when coming up with your budget,” the company says.

A report last year from brokerage company Zoocasa ranked North Bay fourth highest among 35 municipalities, with a tax rate of 1.528326 per cent.

The ranking was unchanged from the brokerage’s 2019 report, when the city’s tax rate then was 1.501246 per cent.

The municipalities with the highest tax rates in Zoocasa’s 2020 analysis were Windsor (1.775679 per cent), Thunder Bay (1.562626 per cent), Sault Ste. Marie (1.530970 per cent), North Bay and Sudbury (1.492189 per cent).

The cities with the lowest tax rates were Toronto (0.599704 per cent), Markham (0.628191 per cent), Richmond Hill (0.653108 per cent), Vaughan (0.665259 per cent) and Milton (0.668702 per cent).

LowestRates.ca says property taxes are collected by local governments to support public education, fire departments, local police enforcement, community centres and libraries, and based on factors including the assessed value of a home, the education tax rate set by the province and a municipality’s residential tax rate.

Every four years, the Municipal Assessment Corp. evaluates properties across Ontario and submits assessed values for each one. This was postponed in 2020 due to the COVID-19 pandemic.

“Property tax might not be at the forefront of most homebuyers’ minds, but it should be included in an overall housing budget,” the company’s analysis reads.

“That’s why we set out to find the most and least expensive cities for residential property tax in the province.”