Property assessment leads to sticker shock for some Cape Breton landowners

When Jeff Clements received the most recent property assessment for a piece of land he owns in the Mira area of Cape Breton, N.S., his reaction was that of sticker shock.

The value of the land had gone from $81,000 to $181,000.

“A $100,000 jump within a span of a couple of months after we purchased the property, which is purely land,” says Clements.

According to Clements, the area doesn't have much in the way of industry, and big hikes in property tax rates makes it tougher for younger people to justify staying.

"If you really want to start an industry in Cape Breton, you have to sit down and look at the next generation of people that will reside here,” he says.

Christina Lamey, a spokesperson for the Cape Breton Regional Municipality, says a 5.4 per cent increase in the annual cap rate – a rate that helps in evaluating a real estate investment – is a big problem.

Most years, the cap rate goes up by 1.5 per cent or less.   

Lamey says property tax discussions typically take place during budget talks, which start next month.

Council met Monday to discuss how to spend a $15-million grant from the province as part of equalization payments.    

"I think they have several options on the table, and in the council meeting there's a couple of them outlined in an issue paper," said Lamey.

Patrick deLamirande, a business professor at Cape Breton University, notes the assessment hike in CBRM – at about 6.3 per cent – isn't as big as some other municipalities. In Halifax, the rate went up between 10 to 20 per cent.

He says it's time for all municipalities to take another look at the cap program.

"We will have to re-evaluate the benefits of this system and what is the effect on people of this program and the evaluation," said deLamirande.

Clements is concerned the increase in rates will push younger Cape Breton residents to leave their home. 

“If we have a cap for long-term residents, and individuals that have owned their home for a long time, why can't we apply that same methodology to youth?" he asks.

For now, property owners in Nova Scotia have until Feb. 10 to appeal their assessments.