<<< back to article list

Understanding Comparative Market Analysis (CMA)


Blog by FRESH Real Estate Team | March 6th, 2012


Assessed Value vs. Current Market Value

When determining the current value of your home, it is important to understand the difference between your City of Calgary assessed value and the current market value. These values are usually not equal amounts and serve different purposes.

What is Assessment Value?
The assessment value of your home is the dollar amount on which our local government levies property taxes.

What is Market Value?

The market value of a home is the dollar amount for which the home would most likely sell in the current real estate market.

How is Assessed Value Calculated?
Assessed value, for the purposes of calculating property taxes is based on current ‘replacement cost’ of your property and average land value in your community.

A property’s assessment value is based on the City’s estimate of the property’s value on July 1 in the valuation year and based on the property’s characteristics and physical conditions on December 31 in valuation year.  

According to law, valuation year is defined as a year prior to taxation year.  For example, in 2009 taxation year, a property is assessed at $500,000, which means that the City estimates the property’s value to have been at $500,000 on July 1, 2008 on the basis of the property’s characteristics and physical condition as of December 31, 2008.

The City uses mass appraisal techniques to determine the assessed value of your home,  uses one of three metrics, depending on the type of property:
•    The Sales Comparison: meaning the sales of similar properties
•    Income: capitalize the income being generated by the property, when it is a rental
•    Cost: land value, plus the depreciated replacement cost of the improvement.

The City will not look at the fact that a home might be dirty, is outdated or decorated to a very specific (often unmarketable) style, all factors that would impact the market value. They also can not factor in improvements to the property over the course of ownership that may have been made that didn't warrant (or for whatever reason didn't obtain) a building permit.

How is Current Market Value Calculated?

Market value is determined by looking at comparable SOLD homes in the local area, competitive home listings, the square footage, location, amenities and condition of the property in questions. Realtors also factor in things such as curb appeal, desireability in terms of location and presentation and maintenance inside the home.

The market value is a theoretical amount; it assumes the property will bring this sale price if is made available in the real estate market with reasonable marketing and with ample time provided to find an interested and qualified buyer. The home may sell for a higher or lower price, however the market value is a good estimate of what the property is currently worth.

Market values fluctuate based on the competition of comparable homes available, recent home sale prices and general market timing issues.

Home market values may be consistently higher or lower based on season, current inventory available and is also affected by other factors such as interest rates and economic trends.


If you would like to arrange an evaluation of your property please contact me!


Leisa BIO

Leisa Fuller founded FRESH Real Estate Ltd. in 2005 with this vision; to provide a real estate experience so unique, stress free and satisfying that clients would absolutely
rave about it. 

The FRESH model was based on the belief that real estate transactions should be holistic in their approach; thoughtful and client centered yet business minded and contractually in the best interest of the client.

If you would like to schedule a meeting with Leisa to discuss evaluating your property, click here.