Growth in tax base slows, but more properties see assessment spikes

Recent dramatic growth in New Brunswick's property assessment base is slowing down for the second year in a row provincewide, but the four largest cities are still seeing major increases in values.  

That is contributing to more properties seeing assessment increases of 10 per cent or more, making them eligible for legislated protection from big hikes in property-tax bills.

The bulk of those are in Moncton, Dieppe, Fredericton and Saint John.

"We are continuing to experience property assessment growth across New Brunswick," Aaron Kennedyy, the minister for Service New Brunswick, said in a statement.

"A strong real estate market and new construction are directly impacting that growth."

Property owners were due to start receiving their assessments in the mail Monday, but Canada Post suspended mail delivery because of a heavy snowfall. The numbers were also available online.

Actual tax bills, based on the rate set by local governments, won't be out until early March, and payments aren't due until May 31. Property owners have until Feb. 19 to seek a review of their assessments.

Under the province's so-called spike protection law, a property's assessed value for taxation purposes can't increase by more than 10 per cent, even if the property's assessment increases more than that.

Service New Brunswick says 242,558 properties will benefit from spike protection this year, slightly more than half the 481,000 properties it assesses.

In 2024, the number that benefited totalled 176,382.

Owners whose properties' assessed values won't reflect their full assessment increase will have to make catchup payments eventually.

The unpaid excess increase beyond 10 per cent is carried over, and owners will eventually have to pay it once their assessment increases fall below that threshold.

"The reality is the percentage this year just gets added to the pile," said Willy Scholten, a board member of the New Brunswick Apartment Owners Association. 

"Regardless, we're looking at the 10 per cent increase in assessments that will be taxed this year, and into the foreseeable future."

That reality, combined with a new legislated provincial rent cap of three per cent, could deter developers from building more units, he said.

Apartment buildings were added to the spike protection policy in 2022 as a temporary measure, and the Higgs government passed legislation in 2023 to make the change permanent, effective with this year's assessments.

Apartment vacancy rates remain low, with the rate in Fredericton at less than one per cent, according to figures from October 2024 from the Canada Mortgage and Housing Corporation.

The growth rate in assessed property values has dropped below 10 per cent this year in Moncton and Fredericton, but remains above it in Dieppe, which again this year is seeing the highest increase.