I had some time to call the City's tax office today and learned quite a bit about how the taxes are calculated/adjusted.
When a new home is built, the taxes are based on purchase price of the home (including GST, down payments, and upgrades - not including CMHC insurance) - that would make our approximate tax bill for 2011 $2,104 - that divided by 12 gives us monthly payments of $175. I'm not sure what the 2012 tax rates will be, so this is the value we've used to sign up for monthly payments to the city.
Because we only owned our home for 6.57% of the year, we we owe approximately $138 for the 2011 year - the payments above are for 2012 while we wait for the adjustment notification that we and our home builder will have to sort out.
When the new property assessments come out in the spring, we'll find out the City's assessment of our homes value and adjustments will be made for payments from June through to December. That could mean that for the remainder of the year our tax bill goes up, or down, depending on if we over or under guessed when signing up for the monthly billing cycle.
You might asked why we signed up for the monthly payments instead of paying annually. Unlike vehicle insurance, there is no interest charged for setting up a monthly payment program vs paying in a lump sum - the only drawback is that we lose out on a very slight amount of interest if we had been putting the money away in a savings account when the annual bill came due. For us - with home ownership being so new, we thought the monthly plan suited us best.
If you are a homeowner, do you pay your property taxes annually or monthly? Why?