Do condo owners pay excessive property taxes?

Note to all prospective condo buyers: Did you know that by purchasing a condo you may be implicitly agreeing to pay unfair property taxes?

In fact, condo owners in Manitoba have been paying excessive property taxes for almost 15 years.

When Aggnes Jonsin moved into her two bedroom South Winnipeg condo a few years ago, she was stunned to find her property taxes were $2500. This is apart from the monthly condo fees she and other owners pay to the management company which manages and maintains the condominium complex.

“What galls me the most,” she said in a recent telephone conversation,”is how unfair my property taxes are. I have many friends who own houses, who pay about the same amount of taxes as I do, but who receive more services from the city than I do. It’s just wrong!”

Deborah Cole, who recently purchased a condo, is also upset with her property taxes. /DONNA MARION

According to the Canadian Condominium Institute – Manitoba Branch, Aggnes is not alone in her discontent.

CCI President, Brenda Brydges, leads the “Fairness in Property Taxes Campaign” on behalf of condo owners in the province. This campaign encouraged owners to make unfair property taxes part of their discussions with political candidates in the recent election and there are plans to continue the lobbying effort in the fall.

Underpinning the campaign was the growing realization that condominiums are taxed at the same rate as single family dwellings. As well, a property with a detached home on it will pay far less in property taxes than the same-sized property with a condominium on it (cci-manitoba.ca).

This creates an imbalance between taxes collected by the city or municipality and services delivered. Because condominiums provide housing density, they save local governments costs for snow clearing, garbage pickup, road maintenance and more. No wonder then that condo developments are springing up around the city.

How can this unfairness to condo owners be redressed?

First of all, a bit of background is in order. Property taxes are established by a province-wide formula: portion x assessed value x mill rate. The assessed value of a property is determined by an assessor and the mill rate is decided by the local government. However, the portion (which is a percentage) is set by the Province.

Currently, condo owners pay a portion of 45%, a percentage identical to the portion charged owners of detached houses but this was not always the case.

For example, in 1990, residential property classifications had percentages ranging from 27.1% for condos to 73.2% for multi-family dwellings.

By 2002, however, all three residential classifications – single family dwellings, apartments and condominiums (which includes co-ops) – were portioned at 45%.

In the lead up to the 2016 provincial election both the PC and the Liberal parties agreed to put the issue of unfair property taxes on their agendas, if elected.

With the new government firmly in place, it’s time to initiate discussions with the department in charge of the Municipal Act, Indigenous and Municipal Relations, so that a revenue-neutral solution can be worked out. Condo owners have borne the burden of excessive and unfair property taxes for far too long.