City to take on land appraisals

Tyler
Tyler Clarke
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The 30 serviced lots along Smiley Drive are seen, which city council decided in a split vote at this week’s city council meeting to not have appraised by Brunsdon Junor Johnson Appraisals Ltd. Instead, they’re doing it on their own. 

Instead of spending about $5,000 on appraisers, city council decided in a split vote for city administration to assess the value of 30 serviced lots on Smiley Drive.

In the midst of Mayor Greg Dionne expressing a desire for the city to get out of land development, Smiley Drive proved a contentious topic during this week’s meeting of council.

“I think that we do not have to go to (the company) to appraise and tell us how much we should sell these lots for,” Coun. Don Cody said. “That can’t be very difficult -- that just can’t be very difficult.”

Whether the city prices the lots too cheaply or two expensively shouldn’t be of concern, Cody argued, noting that the city has “the ability to change from one day to the next if we wish, so I don’t know why need to have someone come from Saskatoon to tell us what we should sell these lots for.”

Although Coun. Rick Orr agreed that the city has the ability to alter the price of lots on a continued basis, the city needs a benchmark, which appraisers would provide.

“I think we should just learn to do it,” Dionne concluded, noting that it won’t be difficult to find comparable lots of land to measure the Smiley Drive lots with.

With private land developers claiming that the city prices serviced lots at too low a rate for them to be competitive, why doesn’t the city ask them what the ideal price should be, Dionne asked.

“This is a change in corporate philosophy,” Coun. Martin Ring said, noting that the appraisers would give the city a good starting point to jump off from during their current shift away from land development.

“Private land developers -- they aren’t doing this out of their heart, they’re doing this for money,” Ring said.

The city, on the other hand, is developing land under the promise of bringing in more tax revenue in the future. As such, the city isn’t as worried about its profit margin on the initial sale.

I think that we do not have to go to (a company) to appraise and tell us how much we should sell these lots for ... That can’t be very difficult -- that just can’t be very difficult. Don Cody

At the urging of Dionne and Cody, the city’s elected officials decided in a split vote to deny a $5,000 tender to Saskatoon-based Brunsdon Junor Johnson Appraisals Ltd. to price the lots, which are set to go up for sale in the spring.

“We understand and accept that it is the prerogative of city council to accept or reject any proposal,” Rick Brunsdon said in response to the news that his company’s job bid was denied.

Although Brunsdon declined further comments, Appraisal Institute of Canada CEO Keith Lancastle agreed to speak with the Daily Herald about appraisals in general terms.

Although he notes that property appraisals are the best way “to determine the most accurate value at any point or time,” serviced lots, such as those on Smiley Drive, are among the easiest to appraise.

“The biggest issue (with serviced lots), the biggest contributing factor there will be the comparables -- similar plots of land,” Lancastle said.

This comment mirrors what Dionne concluded at this week’s city council meeting -- that the Prince Albert & District Association of Realtors help the city develop lot prices, using comparables.

Also discussed during this week’s city council meeting was a repot related to the city developing 141 lots adjacent to Smiley Drive – an item that was referred back to administration for further review.

As stated during the previous week’s executive committee meeting, Dionne doesn’t want the city developing land when there are private developers interested in doing so.

Organizations: Brunsdon Junor Johnson Appraisals, Daily Herald, Prince Albert District Association of Realtors

Geographic location: Saskatoon

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