Tax sale of Vancouver home for $1M less than assessed value can't be completed, city staff say
City staff say the sale of an East Vancouver home for $1 million less than its assessed value can't be completed because of a "manifest error" in the tax sale process.
At a special meeting Thursday, Vancouver City Council will consider a staff recommendation to declare the error in the sale of a home at 3018 Knight St. last November.
Tax sales are one of the city's mechanisms for collecting unpaid property taxes. Each year, the city auctions off properties with tax owing to the highest bidder, but the sales aren't completed right away.
Instead, the owners of the properties included in the auction have 12 months to pay the "upset price," which the staff report describes as "the sum of the delinquent taxes, penalty interest, and registration charges payable to the Land Title Office."
If the property owner pays the upset price within a year of the auction, then the sale is not completed and the property is considered "redeemed."
That's not what happened in the case of 3018 Knight St., however.
Instead, according to the staff report, the sale cannot be completed because the owner of the home died in 2016, and therefore couldn't have received proper notification that the tax sale was happening.
The report indicates no property taxes have been paid on the home since 2016, nor have any declarations for the city's Empty Homes Tax been filed, and liens on the property indicate that it has also been subject to the provincial Speculation and Vacancy Tax.
In all, the upset price for the home was $34,906.32.
The winning bidder paid a deposit for that amount to the city to secure the right to purchase the property for $601,000.
The home's assessed value for 2022 is $1,619,000, according to the staff report.
Because of the lack of proper notice, city staff are recommending that councillors declare a manifest error and refund the upset price to the bidder, plus six per cent interest, in accordance with the Vancouver Charter.
It's unclear what will happen to the home once the sale has been cancelled. The staff report suggests that the property "may have escheated to the Crown as there was no will and no heirs, though that is not certain at this time."
CTV News reached out to the city for more information on what the next steps for the property could be. In an email, the city confirmed that the Public Guardian and Trustee of British Columbia had taken over management of the homeowner's estate, and had paid the outstanding property taxes.
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