A recent report from the Auditor General is making mortgage news, as the Municipal Property Assessment Corporation says that it will be working to improve its processes for reviewing home sales when their prices vary from their initial assessments.
The agency says that the report found a number of properties on which the sale price was either well above or below the home's previously assessed value.
"If five homes in a neighbourhood have sold for $350,000 and one sells for half that, it raises a red flag. There could be something wrong with the value or there could be another reason. We will do a better job of finding out why there is a difference, and if the value is wrong, we will correct it," said Carl Isenburg, MPAC's president and chief administrative officer.
MPAC added that in some of the cases of homes selling for well above their previous values were the result of an older home being torn down and a new one built in its place. Foreclosures could be the cause of many homes selling for below their valuations.
The changes could have a more significant impact in areas such as Alberta, which have seen a higher-than-normal rate of foreclosures. According to the Canadian Bankers Association, 0.78 percent of mortgages there are in arrears, compared to the national average of just 0.42 percent.
