Halifax councillor seeking report on impact of capped assessment program

Halifax council is seeking a staff report on the province’s capped assessment program.

A Halifax councillor is requesting a staff report on the impact of Nova Scotia’s capped assessment program on the municipality’s housing market.

Coun. Janet Steele introduced a motion for a report to “identify inequities” in the program and its effects on housing affordability in Halifax.

Council approved the motion in a 16-to-one vote at their Tuesday meeting. Coun. John Young was the sole dissenting vote.

“I’ve been hearing from a number of new homeowners that they have been paying significantly higher property taxes than their neighbours,” Steele said.

According to the Property Valuation Services Corporation, the program puts a cap on the amount the taxable assessment for an eligible residential can increase year over year. The cap rate, which is 1.5 per cent for 2025, is based on the Nova Scotia Consumer Price Index.

“Some other jurisdictions in Canada that had caps, actually removed the caps because it was causing market distortion,” she continued.

To be eligible for the program, properties must be at least 50 per cent owned by a Nova Scotia resident, be occupied by the owner and be owned for at least a year.

“The CAP is removed for the year following the sale of a property, unless it was purchased from a family member (spouse, child, grandchild, great grandchild, parent, grandparent or sibling),” the Services Corporation’s website reads. “If eligibility criteria are met, the calculation of the new owner’s CAP will begin the next year.”

Steele’s motion says the municipality has to shift the tax burden to property owners who aren’t eligible for the program when the assessment growth is capped for long-held properties.

“Research suggests where property taxes are capped, long-time owners have a strong incentive to stay in their homes even when they might prefer to downsize,” the motion reads. “This reduces the housing market options for growing families.

“There is a gap between assessment market values and capped assessment values which is creating an inequity in the distribution of tax burden.”

Marshall Smith, a realtor in Halifax, said this is causing young people to avoid entering the market.

“Your not seeing as many new listings come to the market and really it’s just benefitting people who have owned property for a longtime. But it’s really gate keeping younger people from getting into home-ownership,” Smith said.

Once the report is complete, council could then direct the mayor to write a letter to the minister of Growth and Development seeking amendments to the Assessment Act to allow for a phased approach to address any identified inequities.

With files from CTV Atlantic’s Jesse Thomas

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