Here in metro Vancouver everything is based on the value of the land and it's potential to have a large new luxury home built on it.  It makes no difference if there is a tear down on that city plot, or a 20 year old house.  

The valuation of my perfectly liveable already fixed up small older house  about $46k,  Yeah.  BC Assessment knows it will be torn down.  Meanwhile my land is valued at 1.8 million.  

Cross the river into the City of Vancouver and you can add another million to land costs that house that "tear down".