MPAC Assessment vs. Market Value: Why Your Home Is 'Worth' Two Different Numbers

Every year, Ontario homeowners look at their property assessment, look at what houses are selling for on their street, and conclude one of two things: either MPAC has made an enormous mistake, or they're getting a quiet deal on their taxes.

Usually, neither is true. The two numbers measure different things, on different dates, for different purposes. Understanding the gap is the single most useful thing you can learn about your property taxes — because it tells you which comparisons are meaningless and which one can actually save you money.

The two numbers, defined

Market value is what your home would sell for today. It moves constantly with the market, and it's the number you see on real estate listings and in your neighbour's sold price.

Assessed value is MPAC's estimate of what your home would have sold for on January 1, 2016 — in its current physical state. That date isn't a typo, and it isn't stale data on your particular file. It's the legislated valuation date for every one of the roughly 5.7 million properties in Ontario.

So a home that would sell for $1.1 million today might carry an assessment of $610,000, and both numbers can be simultaneously "correct."

Why is Ontario using a 2016 date in 2026?

Ontario normally reassesses every property on a four-year cycle. The January 1, 2016 valuation was meant to cover the 2017–2020 tax years, with a new valuation date of January 1, 2020 taking over after that.

Then COVID hit. The province postponed the 2020 reassessment — and then kept postponing it, year after year, by regulation. MPAC has confirmed that assessments for the 2026 tax year are still based on the fully phased-in January 1, 2016 values. As of this writing, no date for the next province-wide reassessment has been announced.

Two side effects of the freeze are worth knowing:

New and renovated homes are valued "back in time." MPAC keeps assessing new construction, additions, and renovations during the freeze — but by law it must value them as if they existed on January 1, 2016, to keep the playing field level. If you bought a new build in 2024, its assessment is an estimate of what that brand-new home would have fetched in the 2016 market. This is why new-build assessments can look bafflingly low next to the purchase price.

"Phased-in" is already finished. Older notices showed values phasing in over four years. That phase-in completed in 2020 — the number on your current notice is the full 2016 value, not a partial one.

Why the gap between the two numbers keeps growing

Since January 1, 2016, residential property values across Ontario have risen roughly 94% on average. Every year the freeze continues, today's market drifts further from the 2016 snapshot, and the gap between your assessment and your market value widens.

Here's the part almost everyone gets wrong: that gap is normal, and it does not mean you're under-taxed.

Ontario's property tax system is revenue-neutral by law. Your municipality decides how much total tax revenue it needs, then sets tax rates against the total assessed value in the city. Assessments don't determine how much tax is collected — they determine each owner's share of it. If every assessment in your city doubled tomorrow, the city would roughly halve its tax rate and your bill wouldn't change.

Which means the comparison between your assessment and your market value is, for tax purposes, a distraction. What determines whether you're paying your fair share is a different comparison entirely.

The comparison that actually matters

Because everyone is valued at the same 2016 date, your share of the tax burden depends on how your assessment compares to other properties' assessments — specifically, properties genuinely similar to yours.

Picture two nearly identical houses on the same street:

House A

House B

Market value today

~$1.1M

~$1.1M

MPAC assessment (2016 value)

$655,000

$572,000

Tax at ~0.9% combined rate

~$5,900/yr

~$5,150/yr

Both owners might look at Toronto-area prices and feel their assessments are "low." But House A pays about $750 more, every year, for the same property — and will keep doing so until the next reassessment, whenever that comes. House A's owner doesn't have a market-value problem. They have an equity problem: assessed high relative to a true comparable.

That's the situation Ontario's review process exists to fix. The argument "my assessment is above my market value" almost never applies during the freeze — nearly everyone's assessment is below market. The argument "my assessment is out of line with genuinely comparable homes" is the one that wins Requests for Reconsideration.

Where people go wrong with the two numbers

Using recent sale prices as appeal evidence. A house that sold last month for $980,000 tells you about the 2026 market. Your assessment is a 2016 value, so the comparison MPAC's reviewers care about is that house's assessment, not its sold price. Comparable assessments — ideally on a per-square-foot basis — are the currency of an equity argument.

Assuming a "low" assessment means a mistake in your favour. During the freeze, a large gap to market value is the default condition of nearly every property in Ontario. It is not a discount, and it will not be "corrected" against you individually — the whole province resets at once when a reassessment finally happens.

Assuming the freeze means nothing can be wrong. The opposite is closer to true. The 2016 model's errors — wrong square footage, a garage that doesn't exist, a valuation that came out high against your street — have now been locked in and billed for a decade. A property assessed 10% above its true comparables in 2016 has overpaid that share every year since.

Expecting your assessment to change when the market drops. Your assessment doesn't track the market at all right now. It changes only if your property changes (construction, renovation, demolition, classification) or if you successfully challenge it.

What happens when the freeze finally ends

Whenever the province announces the next reassessment, every property in Ontario gets a new value reflecting a current valuation date — capturing nearly a decade of uneven market movement in a single update. Because values haven't risen evenly (some neighbourhoods and property types far outpaced others), the shares of the tax burden will shift, creating winners and losers even though the system stays revenue-neutral overall.

You can't control when that happens or what the new model says. What you can control is your baseline: whether the details MPAC has on file are correct, and whether your current assessment is equitable against your comparables. Owners who fix errors now enter the reassessment from an accurate starting point — and stop overpaying in the meantime.

Frequently asked questions

Should my assessment match my purchase price?

Only if you bought around January 1, 2016. A 2026 purchase price and a 2016 assessment aren't measuring the same market. One useful exception: if you recently paid less than your 2016-based assessed value, that's a signal worth investigating, since it suggests the 2016 number may have been high even for its own date.

My assessment went up but there's no reassessment. Why?

Individual assessments still change during the freeze when a property changes — new construction, additions, renovations, severances, or classification changes all trigger an updated notice, valued at what the change would have been worth in 2016. If you received a Property Assessment Notice, something in MPAC's file for your property changed.

Does a low assessment hurt my resale value?

No. Buyers and their agents know Ontario assessments are 2016 values; nobody prices a 2026 sale off them. If anything, a lower assessment means lower carrying costs for the next owner.

Is my assessment what my insurance should be based on?

No — that's a third number again. Insurance is typically based on rebuild cost, which is neither market value nor assessed value. Don't use any of the three as a stand-in for the others.

How do I find out if my assessment is out of line with comparable homes?

MPAC's free AboutMyProperty tool (log in with the roll number and access key from your notice) shows your property's details and lets you compare against properties in your neighbourhood. Verify your own details first — errors there are the most winnable issue — then compare assessed value per square foot against three to five genuinely similar homes. Our complete guide to checking and challenging your assessment walks through the full process, including how to file a free Request for Reconsideration before the deadline: Is your MPAC assessment too high? The complete Ontario guide