Alberta's highest and lowest property tax rates

Updated Oct 24, 2024

For aspiring property buyers in Canada, there are many things to prepare for. You need to save money for down payment in order to secure a mortgage and take note of additional expenses. You should also study the area where you want to buy property. For instance, securing a mortgage to buy a home in Alberta can be challenging if you are uninformed about this province’s real estate market.

Staying updated on the prices of listed houses in Alberta and comparing them with other cities and provinces is beneficial for soon-to-be homeowners. Learning about the property tax rates can also prove to be helpful. Do you know which municipalities have the highest property taxes in Alberta? What about the ones with the lowest?

In this article, Canadian Mortgage Professional will discuss Alberta’s property tax rates, starting from the costliest to the cheapest. We will shed light on what property tax rates are and why they are paid. We will also help you understand how this type of tax is calculated as well as the cost of living in Alberta.

To mortgage professionals who are our long-time readers, this is another one of our client education pieces. If you have clients who want to know which municipalities have the highest property taxes in Alberta, be sure to send this to them!

What are property taxes?

Property taxes are fees that local governments charge on real estate properties. For property buyers, this is an additional cost that you should pay when you purchase a house or a portion of land. All homeowners in Canada pay property taxes every year based on their property’s assessed value.

Why should you pay property taxes?

For residents in a specific location, their property taxes will be used to fund local government programs and services like police and fire protection. It can also be allocated for environmental hygiene such as garbage collection as well as the operation and maintenance of public spaces. Other local services that are funded by property taxes include:

• roads
• schools
• healthcare facilities
• emergency services
• other government projects

In Alberta, each municipality assesses the value of properties. This determines how much is owed by the taxpayers. The tax rate also varies from one municipality to another. This property tax rate is usually a percentage of the property's assessed value.

Property taxes apply to different types of properties such as:

• residential properties
• rental properties
• commercial units
• industrial sites

Every year, real estate owners and investors will receive a tax bill that shows the total amount due for their property taxes. This can also have additional local fees. Some municipalities offer exemptions or discounts for certain groups, like seniors or low-income families.

What happens when property taxes are not paid?

If property taxes are not paid, the local government can place a lien on the property or even start foreclosure proceedings. This is why homeowners need to check with their local government for specific rates and rules, as these can differ across provinces and municipalities.

For example, property is taxed based on the ad valorem (“according to value”) principle in Alberta. What this means is that the property tax which the homeowner must pay is based on the value of the property.

Before we go over the lowest and highest property taxes in Alberta, would you like to find out how to reduce property taxes in Canada? Watch this video:

For expert advice on property taxes or any other mortgage issues, contact one of the top 75 brokers in Canada for 2024. Another good reason to check out our list: the top broker is from Alberta!

Municipalities with the highest property taxes in Alberta

In their latest analysis, brokerage and information portal Zoocasa outlined Alberta’s real estate markets with the lowest and the highest property taxes. The municipality with the most expensive property tax rates is Wetaskiwin. It also took the first spot in 2022.

Check out this comparative table below:

Which municipality has the lowest property tax in Alberta?

Canmore has the lowest property tax in Alberta. Its property tax rate is less than 0.50%. For would-be homeowners who wish to reside in Canmore, they would need to pay less than $1,200 in property taxes if they wish to buy a house valued at $250,000.

Here are the top ten municipalities with the lowest property taxes in Alberta:

Property taxes should not be overlooked

According to Zoocasa, property taxes are considered as a significant carrying cost. As such, these taxes should also be a major consideration for aspiring property buyers.

What happens if they don’t? Well, they might find themselves burdened with an unexpectedly large bill on top of their already considerable mortgage payments. However, prospective home buyers must not make the mistake of assuming that these markets with the lowest taxes are also those that offer more affordable housing. Check out this article on where to find the most affordable housing in Canada.

How are property taxes calculated in Alberta?

In Alberta, property taxes are determined as the product of the property’s assessed value and the municipality’s tax rate.

Here is a video on how property taxes are calculated:

Individual property tax calculations

As for how an individual’s property tax is calculated, it will depend on these three factors:

The total assessment of a property’s value

The total assessment of a property’s value is provided by the Assessment Services Branch. They also provide updates annually. This amount is determined by evaluating the current house prices in a municipality while taking some features of a particular property into account.

A property’s assessed value is affected by its renovations and added amenities. Some examples are:

• extended kitchen
• new garage
• swimming pool
• other renovations

The education tax rate

Alberta has an implemented education tax rate for its residents. The taxes collected are used by the local government of each municipality for the funding of regional schools.

The residential tax rate

Another tax rate that is implemented by Alberta is the residential tax rate. Every year, each city council of all municipalities determines how much money needs to be raised to meet their budget needs.

Do seniors pay less property taxes in Alberta?

Senior citizens in Alberta can choose to defer all or part of their municipal property taxes with a low-interest home equity loan through the Seniors Property Tax Deferral Program. This also includes education taxes.

Here are the requirements for the Seniors Property Tax Deferral Program in Alberta:

• applicant must be 65 years old or older with only one spouse or partner who needs to be at least 65 years old
• applicant must be a resident in Alberta who has lived in the province for at least three months
• applicant must own a residential property in Alberta and the home must be their primary residence
• applicant must have a minimum of 25% equity in their home to allow the government to secure the loan and ensure repayment when the loan is due

Cost of living in Alberta

Aspiring homeowners in Alberta should be aware of this Canadian province’s cost of living. For starters, the average home price in the area is $494,920. This is just $150,000 less than the average cost of properties across the country. This makes Alberta one of the most expensive provinces in Canada to reside in.

Aside from the costly home prices, the cost of living in Alberta is also high. This can be observed in terms of:

• utilities like electricity and water
• transportation costs
• car maintenance and fuel
• parking fees
• groceries
• childcare

For house prices, Alberta is the fourth most expensive in Canada behind British Columbia, Ontario, and Quebec. If you are curious to know which provinces have the highest cost of living in Canada, check out this article.

Navigating highest property taxes in Alberta

When searching for properties in the area, it is important to consider which municipalities have the highest property taxes in Alberta—along with the lowest. It is beneficial for prospective home buyers to take note of property taxes, even outside of this province, for better financial planning.

They can also align their budget or choose to buy a larger house if they can navigate these taxes wisely. Being aware of a location’s cost of living, may it be in Alberta or not, can also help aspiring property owners prepare for the costs of securing a mortgage.

Do you want help in navigating the highest property taxes in Alberta? What about in other parts of the country? Then take the time to look at the mortgage professionals we highlight in our Best in Mortgage section. Here you will find the top performing mortgage professionals, including mortgage brokers, across Canada.

Do you have any tips on how to navigate the highest property taxes in Alberta? Feel free to share your insights in the comments section below.