trouble cards

Question 1

Which of the following statements regarding home owner grants is FALSE?

1. Where the tax due date falls before the adjustment date, the actual taxes paid will be the figure adjusted.
2. Where the tax due date falls after the adjustment date and either the vendor or purchaser or both are not eligible for a grant, then the gross taxes should be adjusted.
3. Where the tax due date falls before the adjustment date and both the vendor and purchaser are eligible for the basic grant, but one or both are not eligible for the seniors grant, the gross taxes should be adjusted.
4. Where the tax due date falls after the adjustment date and both the vendor and purchaser are eligible for the seniors grant, the taxes net of the seniors grant should be adjusted.

Answer 1

Correct Answer: 3

Option 3 is false because where the tax date falls before the adjustment date, the actual taxes paid will be the figure adjusted C in this case it would be taxes net of the basic grant. The other options are all true.

Question 2

An appraiser is using the income approach to determine the market value of income-producing properties. Which of the following items should be included in the calculation of net operating income?

a. An allowance for vacancy

b. An allowance for the leasing inducement paid at the onset of the lease

c. An allowance for the replacement of items such as the appliances in the suites

d. All taxes, including real property and income tax

1. A, B, C, and D
2. A, C, and D only
3. A and C only
4. A and D only

Answer 2

Correct Answer: 3

Calculation of net operating income (NOI) includes vacancy and debt allowance and, ongoing operating expenses. These include real property taxes, fuel, electricity, maintenance and repairs, replacement reserves, water, wages, management costs, insurance policies and some miscellaneous expenses. A leasing inducement, much like sales commission is not an ongoing operating expense, rather it is a one-time payment and deducted from the estimate of market value. The items omitted when calculating NOI are depreciation, income tax, capital cost allowance and debt service.

Question 3

Which of the following statements is/are TRUE?

a. Real property taxes, income taxes, and replacement reserves are all examples of typical deductions when calculating the net operating income for apartment buildings.

b. Potential revenue from laundry machines is not considered to be “other income” because it is difficult to estimate the amount of laundry tenants will do in a year.

c. A wide gap may exist between the Gross Potential Revenue and Gross Effective Revenue of an apartment building if the property is managed poorly.

d. Gross potential revenue is estimated using the rents currently earned by the property.

1. C only
2. A and D only
3. A, B, and D only
4. B, C, and D only

Answer 3

Correct Answer: 1

Statement C is true; the difference in the figures is determined by the deduction of operating expenses where some expenses are directly controlled by management. Furthermore, higher revenues by way of higher rentals may be attainable given better management of the premises. Statement A is false; income tax is not deducted in determining net operating income. Statement B is false; the revenue collected by the coin‑operated machines in the apartment building, provides an estimate of machine use by the tenants and is considered “other income”. Statement D is false; market rents are used to estimate gross potential revenue. Therefore, option (1) is correct.

Question 4

Simon is considering investing in either investment A or investment B. Compared to investment A, investment B has lower risk, higher liquidity, and fewer management requirements. Simon selects investment B, expecting a __________.

1. a lower return
2. a higher return
3. a zero return
4. the same return

Answer 4

Correct Answer: 1

When comparing two investments, one should consider the liquidity, risk, and management requirements, as well as the return on equity. Higher liquidity, lower risk, and less management requirements will all lower the return required by investors.

Question 5

Which of the following statements regarding “escalator clauses” in property management is TRUE?

1. An escalator clause allows the landlord to avoid giving notice of rent increases and is found only in residential tenancies.
2. An escalator clause allows the landlord to recover expenses from the tenant should expenses increase, and is generally found in industrial and commercial leases.
3. An escalator clause assigns rental increases based on comparable increases and is found strictly in residential tenancies.
4. An escalator clause allows rent to increase along with inflation and is commonly found in all types of leases.

Answer 5

Correct Answer: 2

Escalator clauses are usually found in industrial and commercial leases. An escalator clause gives the landlord the ability to recover any increases in operating expenses from the tenant.

Question 6

Consider the following statements:

a. Vacancy and bad debt allowance is an allowance for reductions in gross potential revenue attributable to vacancies, tenant turnover, and non-payment of rent or other income.

b. When a property owner uses debt to finance a property, the net operating income represents a return on the equity portion of the property’s value.

c. Property taxes generally represent the single largest operating expense for an income-producing property.

d. The gross potential rent of the subject property is only estimated by the actual rents currently being paid on the subject property.

Which of the above statements is/are TRUE?

1. C only
2. A and C only
3. B and D only
4. A, B, and C only

Answer 6

Correct Answer: 2

Statement A is true; vacancy and bad debt allowance are not operating expenses, rather they indicate long term vacancy rates or trends in the area and are deducted from gross potential revenue property. Statement C is true; property taxes generally represent the single largest expense for income‑producing property. Statement B is false; net operating income represents a return on the entire value of the property, before financing is considered; net operating income is not a return on the equity portion of the property’s value. Statement D is false; the gross potential rent of the subject property is estimated by comparing current rental levels of comparable buildings, not the current rental level in the subject building. The rents of the subject property may be significantly more or less than the rents that the building would receive due to the poor management, the state of repair of the building or other factors. The appraiser must estimate the rent the building could receive by considering the rents received by several comparable buildings.

Question 7

Consider the following statements regarding the income approach. Which of the statements are TRUE?

a. The cost of repairs considered a one-time payment and immediately required at the time of appraisal, should be deducted as a lump sum from the property’s final value.

b. Items specific to an owner or investor are omitted in the calculation of net operating income.

c. The income approach cannot be applied to an owner-occupied commercial building.

d. Direct capitalization is the only technique used in the income approach of appraisal.

1. A and D only
2. B and C only
3. C and D only
4. A and B only

Answer 7

Correct Answer: 4

Statement A is true; an immediate repair is not considered an ongoing operating expense and so the amount is deducted from the calculated market value to arrive at the final estimate of value as at the effective date of appraisal. Statement B is true; many items are specific to the owner and should therefore not be used in the calculation of NOI, such items include: depreciation, income tax, and debt service. Statement C is false; the income approach focuses on “market” rental income and so whether or not it is inhabited by its owner makes no difference in principle in applying this method. Statement D is false; both the direct capitalization and discounted cash flow techniques can be used in the income method of appraisal.

Question 8

Which of the following statements is/are FALSE?

a. The conversion from net operating income to a capital amount is referred to as the capitalization process.

b. A gross lease is where the tenant pays a base rent, all operating expenses, and structural maintenance and repairs.

c. Net operating income is a return on the equity portion of the property’s value.

d. The economic life of a building depends on its economic durability, not its physical durability.

1. A and D only
2. A and B only
3. B and C only
4. C and D only

Answer 8

Correct Answer: 3

Statement B is false; a gross lease is where the landlord pays all the operating costs and structural repairs and maintenance. The tenant is charged a base rent plus a contribution to these expenses, with this gross rent remaining constant during the term of the lease. Statement C is false; the net operating income is not a return on the equity portion of the property’s value, it is a return on the entire value of the property.

Question 9

Consider the following statements with respect to the comparative approach of appraisal.

a. An appraiser can use the consumer price index to adjust a non-recent sale price to the appropriate level of value at the appraisal date because changes in the value of consumer products usually coincide with changes in the value of property.

b. Common area charges need not be included in the market value of a condominium unit because these charges are market related and are standard from project to project.

c. One problem in applying the comparative approach is the difficulty in establishing similarity. This problem is compounded when there are few comparable properties.

d. No adjustments for value are required for vendor takeback mortgages where the contract rate of interest is different from the prevailing market rate of interest given the stable and low market interest rate environment of recent years.

Which of the above statements are FALSE?

1. A and C only
2. C and D only
3. A, B, and D only
4. All of the above

Answer 9

Correct Answer: 3

Statements A, B, and D are false. Statement A is false because general price indices such as the consumer price index are irrelevant to the appraisal of one particular property since changes in the value of consumer products are not necessarily the same as changes in the value of property. Statement B is false because common area charges need to be included since they are not standard, rather they vary from project to project. Statement D is false because a differential in the contract rate and market rate (notwithstanding a stable and low interest rate environment), requires a finance adjustment to make it comparable with the subject property.

Question 10

You have just been assigned to complete the appraisal of an old, two-storey house in Burnaby and are conducting an analysis of comparable sales. You have found a comparable property that is similar in all respects except that when sold, the seller arranged a buydown, offering the buyer an interest rate of 1.5% below the market rate. Which of the following statements is/are TRUE?

a. The price the buyer paid may be less than the market value of the real estate because of the benefit the buyer receives with below-market financing.

b. The price the buyer paid may be more than the market value of the real estate, because of the benefit the buyer receives with below-market financing.

c. The financing terms of a sale have no bearing on its price, and therefore do not need to be considered when analyzing comparable sales.

d. Non-market financing arrangements only warrant adjustments to the sale price of comparable properties if market evidence suggests that they affect value.

1. C only
2. A and D only
3. B and D only
4. D only

Answer 10

Correct Answer: 3

A developer or seller may have arranged a buydown, paying cash to the lender so that a mortgage with a below-market interest rate can be offered. The buyer may possibly have paid a higher price for the property to obtain below-market financing. The appraiser needs to investigate if these arrangements actually affected the sale price of the property. Market evidence is always the best indicator.

Question 11

Which of the following statements is/are TRUE?

a. In property appraisal, “recent” refers to a time period where the market is relatively stable.

b. When determining market value using the comparative approach of appraisal, it is not necessary that recently sold comparables be similar to the subject property in every respect.

c. The total size of the lot rather than its frontage is a more important consideration when considering the site.

d. There is no certainty as to whether corner lots have greater or less value than inside lots.

1. D only
2. A and D only
3. A, B, and C only
4. A, B, and D only

Answer 11

Correct Answer: 4

Statements A, B, and D are true. Since houses are built parallel to the street, the frontage is a more important consideration rather that total area or depth. The value of the lot varies directly with frontage than with area or depth.

Question 12

Which of the following statements regarding the cost approach is/are TRUE?

a. Site value is the market value of the land with improvements.

b. The reliability of the cost method depends on the validity of the assumption that cost and value are equal.

c. The value of a property’s improvements should be estimated using the improvements’ current reproduction cost.

d. A property with a small house located in the centre of Vancouver’s business district would best be appraised using the cost method of appraisal.

1. B only
2. A and D only
3. B, C, and D only
4. All of the above

Answer 12

Correct Answer: 1

Statement A is false because the site value is the market value of the land without any improvements. Statement B is true. Statement C is false because current replacement cost, not reproduction cost, should be used to estimate the value of a property’s improvements. Statement D is false because a small house in Vancouver’s business district is likely not in its highest and best use and therefore possesses latent value and should be appraised using the residual approach.

Question 13

Which of the following factors should be considered when using the comparative method of appraisal to value a house?

a. Whether the comparables being used can be classified as “recent” sales

b. If there is an adequate number of comparables that can be used for comparison

c. Whether the dimensions of a comparable property’s lot are different than the subject property’s lot

d. Whether or not the comparables are similar to the subject with respect to legal title

1. A, B, and D only
2. D only
3. A and B only
4. All of the above factors should be considered.

Answer 13

Correct Answer: 4

There are various factors that are important when appraising a house using the comparative method. The time of the sale and the number of comparables available are very important. Also, the dimensions, not just the area, are important. For example, if a property has the same area, but a different depth, this means the frontage will be different, resulting in an incorrect comparison. Finally, comparables must have similar title status to be comparable. For example, one house with an easement and one without may not be comparable.

Question 14

Which of the following statements regarding appraisal is FALSE?

1. A sale is likely to be realized when the floor price is less than the offered price.
2. A form report appraisal meets the needs of, and is commonly used by financial institutions.
3. An appraiser need not understand the property interest that is to be valued, as long as they use the correct appraisal method.
4. Appraisers estimate value as at a specified date, known as the “date of valuation”.

Answer 14

Correct Answer: 3

p Option (3) is false because it is the value of the legal interests in real estate that is being estimated. The most common being fee simple interest but there are other lesser interests and there may be charges against these interests such as easements and liens. All other options are true.

Question 15

A nine-storey apartment complex in Vancouver was recently destroyed by fire. The appraisal report recommends that a mixed-use development with residential above and street level commercial units be constructed. Given this information, which of the following statements is/are TRUE regarding the property BEFORE the fire?

1. The property had redevelopment potential.
2. The property had latent value.
3. The property was at its highest and best use.
4. Both (1) and (2) are correct.

Answer 15

Correct Answer: 4

As a rough indication of whether an existing property represents its highest and best use, it is useful to ask AIf this building burned down, would the same type of building be constructed in its place? If the answer is a yes, the existing development probably represents highest and best use. In this case the report recommends for a mixed-use development so that the property before the fire was not developed to highest and best use and that it had redevelopment potential and latent value.

Question 16

Which of the following statements regarding the comparative approach is FALSE?

1. The income approach is similar to the comparative approach; both rely on market evidence from similar properties.
2. The comparative approach reflects market behaviour and requires a minimum of subjective opinion from the appraiser.
3. The residual method is only applicable when determining the highest and best use of the land as vacant.
4. The cost approach assumes that the improvement’s replacement cost new may exceed its market value.

Answer 16

Correct Answer: 3

Option (3) is false because the residual method may also be used to determine the value of the building as the residual amount. In this case, the land value may be known using the comparative approach and the value of the improvements is unknown. Option (1) is true because instead of comparing similar sales, the income approach compares revenues and expenses relative to the sale prices of similar properties. Option (2) is true, market data reflects market expectations; the proviso is that the quality of, and market data selected, is based on the appraiser’s experience and judgement. Option (4) is true because the improvement’s replacement cost new may exceed its market value since the cost of producing the asset may not directly relate to market expectations. An example is in the case where an individual with a personal preference to have their house built using triple glazed windows vs. double glazed windows (standard in the marketplace).

Question 17

Which of the following statements is/are TRUE?

A. The direct comparison approach is based on the market principle.

B. Due to the immobility of real property, external factors or externalities will impact value.

C. The neighbourhood an appraiser should consider when doing an appraisal may not be limited to the subdivision in which the property is located.

D. The presence of a special purchaser in a sales transaction will greatly extend the range of possible bids.

1. A and B only
2. B, C, and D only
3. A, B, and C only
4. All of the above

Answer 17

Correct Answer: 2

Only statements B, C, and D are true. Statement A is false because the direct comparison approach is based on the principle of substitution: a property’s value should be no more than the cost of purchasing a substitute property that provides similar utility.

Question 18

Of the following pairs, which best completes the following statement?
“Highest and best use is based on the principle that the market value of property depends on _______ use rather than on ________ use alone.”

1. current; potential
2. future; past
3. potential; current
4. past; future

Answer 18

Correct Answer: 3

The appraiser considers whether or not the current use of the land reflects its highest and best use and if not, then the value of the potential alternative uses should be considered such that the land meets its economic potential.

Question 19

A provincial government’s decision to acquire a tract of land to widen the highway is an example of a property appraisal for _______ purposes. Whereas a parking lot considered for redevelopment requires a property appraisal for _______ purposes.

1. special; conventional
2. statutory; market
3. illegal; legal
4. public; private

Answer 19

Correct Answer: 2

Expropriation follows a statutory reason with the appraiser guided by provisions outlined in the relevant Acts to estimate value; a property being considered for redevelopment requires market data with no need to follow government statutes to determine value.

Question 20

The “subject of an appraisal” is:

1. determined by the appraiser and the neighbourhood characteristics of the residence.
2. the land which will provide the maximum net return during the foreseeable future.
3. the legal rights of ownership vested in a certain piece of real estate.
4. determined by distinct boundaries which are natural, such as hills, streams and lakes.

Answer 20

Correct Answer: 3

In an appraisal, it is the value of legal interests in real estate that is estimated and not necessarily the physical property itself. The words “legal interests” mean “legal rights of ownership”, and the subject of an appraisal is the particular rights of ownership vested in a certain piece of real estate.

Question 21

Ryan, a real estate appraiser, has appraised a property for a bank for mortgage loan purposes. Although the appraisal was intended for the use of the bank loans officer, the purchasers of the home were shown the appraisal by the loans officer. Later, it was found that the home was infested with bugs, and that the appraiser had negligently assessed the worth of the home as much higher than its actual value. Consider the following statements regarding the purchasers remedy against Ryan.

A. Based on the principles of negligent misrepresentation, the purchasers may have a claim against the appraiser.

B. As the appraisal was prepared for the bank, there is no privity of contract between the purchasers and the appraiser, and therefore the purchasers can have no remedy against the appraiser.

C. Damages resulting from a claim of this nature could properly be determined by calculating the difference between the actual value of the home and the price paid by the purchasers.

D. If the appraiser can demonstrate that the purchasers did not rely on the appraisal in making their purchase, then the purchasers will be denied a remedy.

Which of the above statements is/are FALSE?

1. A only
2. B only
3. A and D only
4. B and C only

Answer 21

Correct Answer: 2

While it is true that there is no privity of contract between the appraiser and the purchaser, the principle of negligent misrepresentation, if applicable, will operate to provide the purchasers with a remedy even without privity of contract. In order to succeed in a claim for negligent misrepresentation, the party seeking redress must be able to demonstrate that the statement was untrue, that it was made negligently, that there was a special relationship between the parties giving the rise to a duty of care, and that the plaintiff relied on the statement. Thus, if Ryan could prove that the purchasers did not rely on the statement then he will not be held liable for this negligent misrepresentation. A successful claim of negligent misrepresentation could result in an award of damages equal to the difference between the actual value of the home and the purchase price paid.

Question 22

Why is an analysis of highest and best use of a property important?

A. It helps the appraiser identify comparable properties.

B. It identifies the use or uses on which the final opinion is based.

C. It helps to interpret the market forces that affect the subject property.

D. It helps to identify which appraisal approaches may be used.

1. A only
2. B and D only
3. A, C, and D only
4. All of the above

Answer 22

Correct Answer: 4

All the options are true.

Question 23

Asad is a property inspector who has been tasked with inspecting a home that Jasmine would like to purchase. Asad is currently inspecting the frame of the house. However, when he reaches the upper floors, he is unable to see the frame. What should Asad be looking for when determining if any damage has been done to the home’s frame?

1. Tilted light fixtures or window frames
2. Bulges around windows and doors
3. Large cracks in the wall or ceiling finish
4. Sloping floors

Answer 23

Correct Answer: 3

Option (3) is correct because when examining upper level floors, the frame is hidden and the only indication of structural distress will be large cracks in the wall or ceiling finish. Option (1) is incorrect because tilted light fixtures or window frames do not necessarily indicate structural distress. Option (2) is incorrect because bulges around windows and doors do not necessarily indicate structural distress. Option (4) is incorrect because sloping floors do not necessarily indicate structural distress.

Question 24

As a real estate licensee, you are conducting an open house for your client. A prospective purchaser asks for a glass of water and when they turn on the kitchen tap, the water comes out a blue/green colour. This condition is MOST likely a result of which of the following?

1. Corroded galvanized steel pipe joints and fittings
2. Corroded copper pipe joints that were not cleaned properly after being soldered
3. The use of lead piping in the water system
4. Worn out gaskets and washers causing leakage into the cold water supply system

Answer 24

Correct Answer: 2

Option (2) is correct because corroded copper pipes turn pipe joints and the water running through them a blue/green colour. Option (1) is incorrect because the corrosion of galvanized steel pipe joints and fittings results in brown-coloured tap water that tastes rusty. Option (3) is incorrect because lead piping is used in waste water systems and not for cold water supply. Option (4) is incorrect because worn out gaskets and washers cause leaks out of the cold water supply system but do not cause colour changes in water.

Question 25

Which of the following is LEAST likely to be a feature of a green building? 1. Requires minimal maintenance and care 2. Uses more water than typical homes 3. Provides a healthy indoor living environment 4. Uses renewable resources such as solar heat and natural airflow

Answer 25

Correct Answer: 2 Option (2) is correct because it is least likely to be a feature of a green building because a green building will improve water efficiency, which will result in less (not more) water being used. Options (1), (3), and (4) are incorrect because they are all features of green buildings.

Question 26

In British Columbia, most of the regulation regarding the use of private land comes from: 1. the local governments. 2. the provincial government. 3. the federal government. 4. both the provincial and federal governments.

Answer 26

Correct Answer: 1 Local governments have significant regulatory control over privately-owned land. In fact, local governments have more day-to-day impact on privately - owned land than both the provincial and the federal governments combined.

Question 27

Which of the following statements is TRUE regarding an appeal of a decision of the Property Assessment Review Panel? 1. An appeal to the British Columbia Supreme Court from the Property Assessment Appeal Board can only be heard on a point of law, not of fact. 2. An appeal can be made directly to the British Columbia Supreme Court from the Property Assessment Review Panel. 3. Only owners of assessed property can appeal a Property Assessment Review Panel decision. 4. Owners can appeal their property assessment as well as their property taxes.

Answer 27

Option (1) is true, and therefore is the correct answer. An appeal from the Property Assessment Appeal Board to the British Columbia Supreme Court can only be made on a point of law, not of fact. Option (2) is false because an appeal of a Property Assessment Review Panel decision must first be made to the Property Assessment Appeal Board before appealing to the British Columbia Supreme Court. Option (3) is false because any person, including a municipality, who is dissatisfied with the Panel's decision, can appeal to the Property Assessment Appeal Board. Option (4) is false because property owners cannot appeal their property taxes. Owners can only appeal their property assessment.

Question 28

Amrit has built a home in Victoria, which has yet to be occupied as a place of residence. He decides to move to Montreal for a few years and rents out the home for a 3-year term to a friend of his to live in while Amrit is out of the city. Which of the following statements regarding the tax status of the home is correct? 1. The move-in by the long term tenant triggered the self-supply rule and GST is owed by Amrit on the property. 2. Amrit has not triggered the self-supply rule because he has not yet moved into the home and therefore does not owe GST until the property is sold to a third party. 3. Amrit triggered the self-supply rule under the Excise Tax Act. He owes GST on the property and will also be responsible for collecting and remitting GST upon sale of the property. 4. GST will be owed only if Amrit gives the renter the option to purchase the property outright.

Answer 28

Correct Answer: 1 Option (1) is correct and option (2) is incorrect because the self-supply rule not only applies when the builder moves into the home they have built but also when the builder rents out the home to a long-term tenant prior to a sale. Amrit owes GST but he can probably recover GST paid on the construction costs through an input tax credit or non-registrant rebate. Option (3) is incorrect because if the self-supply rule is triggered, GST is owed immediately and not owed again once the property is sold. Option (4) is incorrect because the option to purchase the property does not affect whether Amrit owes GST. The move-in by the long term tenant triggered the self-supply rule and therefore Amrit owes GST immediately.

Question 29

Some real property may have an actual value for real property taxation purposes which is lower than market value because: 1. the property is owned by a non-profit organization. 2. a statute provides that it is assessed based on current use. 3. the owners qualify for tax deferment. 4. the property has been lived in continuously for 5 years.

Answer 29

Correct Answer: 2 Option (2) is correct because section 19(8) of the Assessment Act states that the actual value of certain residential properties may be based only on current use. If the resident-owner of a property has lived continuously in the residence for ten years, the resident-owner has made applications with the assessor each year, and the property has been zoned for a higher use or influenced by other non-residential uses of adjoining properties, the actual value for property taxation purposes may be based on current use, which may be lower than market value. Option (1) is incorrect because the nature of the owner has no bearing on the value of the land for taxation purposes although it may be relevant for tax exemptions. Option (3) is incorrect because when home owners qualify for tax deferments, they obtain a reduction in their net property taxes. However, this has no impact on actual value of the property. Option (4) is incorrect because the fact that a property has been lived in continuously for 5 years does not change the value of real property for taxation purposes.

Question 30

Which of the following statements about improvement districts is FALSE? 1. Improvement districts are established by the provincial government following a petition by the residents of the area involved. 2. Improvement districts are limited to rural areas only. 3. Improvement districts are governed by elected trustees who may pass bylaws to carry out the district's objectives. 4. The main powers of improvement districts relate to the construction, operation or maintenance of utilities in rural areas.

Answer 30

Correct Answer: 2 Option (2) is correct because the boundaries of an improvement district may include areas within a municipality. Although improvement districts are generally located in rural areas, this is not necessarily the case. Options (1), (3), and (4) are incorrect because they are all true statements.

Question 31

Bert recently proposed a subdivision plan which was accepted by the approving officer. Bert is anxious to find out what may be required of him under subdivision bylaws. Which of the following requirements or regulations could NOT be imposed on a subdivider such as Bert? 1. The requirement to provide roads and street lighting 2. The requirement to set aside land for a park or school 3. A building scheme for the residences to be built in the subdivision 4. The duty to protect riverbanks within the subdivision from development

Answer 31

Correct Answer: 3 Subdividers of land may be subjected to a number of requirements and regulations. A building scheme is not one of those regulations, but rather a method used by developers themselves to maintain aesthetic uniformity in a new housing development.

Question 32

Tussaud bought a large piece of property in the Vancouver area on which she constructed a wax museum. The area was subsequently rezoned to residential use. What will most likely be the new status of Tussaud's tourist attraction? 1. Under the new zoning bylaw, the museum will be deemed an illegal use of land and Tussaud will be forced to shut it down. 2. The museum may continue operation as a legal non-conforming use of the land, but only while owned by the original owner, Tussaud. 3. The museum may continue operation as a legal non-conforming use, but may lose this status if it shuts down for more than 90 days. 4. Tussaud will only be able to continue operation of the tourist attraction in this area if she applies for and is granted a development variance permit.

Answer 32

Correct Answer: 3 Option (1) is incorrect because zoning bylaws cannot be retroactive. Option (2) is incorrect because the status of legal non‑conforming use of land may continue through successive changes in ownership. Option (3) is correct because the status of non‑conforming use will be lost if the use is discontinued for more than six months (90 days in Vancouver), unless the discontinuance is part of normal seasonal or agricultural practice. Option 4 is incorrect because a development variance permit cannot vary the land use provisions in any bylaw.

Question 33

Which of the following statements is FALSE? 1. Valuation of real property for property taxation purposes is done annually. 2. In the regular deferral program, a minimum of 25% equity in your home is required to qualify, whereas in the families with children program, only 15% equity is required. 3. For property tax purposes, an important consideration when assessing the value of improvements such as pipelines and utility cables is the selling price of those improvements in the open marketplace. 4. For property taxation purposes, a given tax rate applies with respect to each $1,000 of net taxable value.

Answer 33

Correct Answer: 3 Option (3) is false, and therefore is the correct answer. Statutes provide for special assessment of utility and industrial land improvements because of the absence of market evidence on which to determine actual value. Option (1) is true because valuation of real property for property taxation purposes is done annually. Option (2) is true because in the regular deferral program, a minimum of 25% equity in your home is required to qualify, whereas in the families with children program, only 15% equity is required. Option (4) is true because for property taxation purposes, a given tax rate is applied to every $1000 of assessed value of the property, less any exemptions that apply. This is called the mill rate.