A: Many sources have different definitions. However, the most commonly referred to are as follows:
The Municipal Government Act (MGA) states: “market value” means the amount that a property, as defined in section 284(1)(r), might be expected to realize if it is sold on the open market by a willing seller to a willing buyer;
The IAAO provides a more comprehensive definition as follows:
The most probable price (in terms of money) which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby:
1)The buyer and seller are typically motivated;
2) Both parties are well informed or well advised, and acting in what they consider their best interests;
3) A reasonable time is allowed for exposure in the open market;
4) Payment is made in terms of cash in <Canadian> dollars or in terms of financial arrangements comparable thereto;
The price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale.