Coastal Trend

PICTOU - Officials are concerned coastal communities could be eroded by a trend of increasing waterfront property values.
Since 2006, the assessed value of residential properties in Pictou County has climbed by about 52 per cent.
County CAO Brian Cullen said in recent years a growing number of coastal properties have been purchased for recreational purposes or for cottages.
"So, I guess over time you will see an erosion of rural ownership," said Cullen.
He said in some coastal communities, like Little Harbour and Melmerby, assessments have skyrocketed beyond those in other traditional cottage areas such as St. Margaret's Bay.
That trend of increasing property values could eventually prevent people who work in traditional coastal industries from building new homes in those areas.
County Warden Ronnie Baillie said the increase is putting pressure on people who choose to live and work in coastal communities.
"Without a doubt you've got to have the opportunity to live as close to your job as possible," said Baillie. "It's a very deep concern to us, but it's outside of our control."
Market values of properties in the province are determined by the not-for-profit Property Valuation Services Corporation (PVSC) and municipalities use those numbers to calculate annual taxes.
PVSC spokesman Joe McEvoy said from 2001 to 2005 there were dramatic increases in the market value of waterfront properties in some areas of the province, which continue to be sold at premium rates.
"Waterfront properties are increasing at a quicker rate than non-waterfront properties and that's a trend across the province," said McEvoy. "Good ocean frontage will get a premium price and lakefront will get a better price than non-lakefront."
He said values were driven up at the turn of the century because of a high demand for waterfront property and some good marketing in areas such as the south shore. Real estate markets are closely monitored to determine if factors influencing values are representative of trends or the result of anomalies such as one property buyer purchasing large quantities of land in one specific area.
The corporation based this year's assessments on real estate market values for the year 2008.
Residential properties across the municipality are valued at $1.356 billion, but that figure goes down to $1.136 billion because properties are protected from large assessment hikes by caps.
The Cap Assessment Program (CAP) is set at zero this year because there was no increase in the consumer price index, which is used as the indicator to limit increases in assessments on residential properties.
Cullen said at the current tax rate of 81 cents/ per $100 of assessed residential property value translates into about $1.7 million in lost revenue for the County.
"We need $11 million to run the county and if the cap value wasn't there our tax rates would be lower, but the owners of high assessed properties would be carrying a higher level of tax," said the Warden.
The county supports the position of the Union of Nova Scotia Municipalities that would like a system introduced favouring taxes tied to the income of an individual implemented through programs and abandoning the cap.
Cullen said it is a "dangerous" practice for homeowners to be complacent about not appealing assessments when there is a large gap between market value and capped value.
"In future years it really is incumbent upon property owners to make sure they are comfortable with those values," said the CAO.
He said the province would be reviewing the CAP this year.