Property rate outrage in Joburg

 ·27 Jul 2023

Joburg residents have raised concerns over their property valuations and the excessive rates they are being forced to pay despite some of them still objecting to the outcomes of the latest General Valuation Roll (GVR) of 2023.

The GVR is conducted every four years, and the City of Johannesburg published its roll on 15 February 2023.

However, there has been outrage over the outcomes of these valuations by the city, with the average property value in Joburg having increased by 44%, according to the Organisation Undoing Tax Abuse (Outa).

“Our surveys have found that, on average, the value of Joburg residents’ properties have shot up by 44%, and if you add the 2% rates hike, this is extremely unjustified considering the economic climate,” said Outa Executive Head of Social Innovation, Julius Kleynhans, in an interview with Newzroom Afrika.

What’s worse is that these massive property rate increases are on top of already exorbitant increases in other city tariffs, including electricity (14.97%), water (9.3%), sanitation (9.3%), and refuse removal (7%).

The organisation noted that unfair valuations have affected around 934,652 residents in Johannesburg, and while there are currently around 42,000 homeowners who have objected to their valuations, many others only received their outcomes after the objection deadline of 31 March 2023.

Outa Executive Head of Social Innovation, Julius Kleynhans.

Additionally, even those that have objected are being forced to pay the massive increase in rates despite the fact they are still in the process of objecting, causing outrage among these residents.

“The city has applied these rates accordingly, and residents have to fork out the money to pay for the rates whether they are accurate or not,” said Kleynhans.

“The objection process is supposed to give these residents the opportunity to get an independent valuation done on their properties, but some get their valuations after the end date, and if they do object in time, they are told they have to pay the exorbitant new rates while going through the objection process,” he added.

As an example, Kleynhans said one resident noted that she was paying around R700 per month on her property, and now, she is paying over R3,000.

What adds to the suspicions of these valuation increases is the fact that property inflation data for Joburg shows values are actually down at the moment, so it’s clear the city is applying rates well above inflation.

“The city needs to be reasonable and fair, I have no problem with the 2% increase, but this cannot be implemented while the objection processes are still ongoing,” said Kleynhans.

He believes that the mechanism that cities use to value properties needs to change because these spikes occur every four years, and it’s sustainable and unaffordable for many South Africans.

In light of the affordability concerns of the rate hikes, Outa wrote to the City of Johannesburg in June, asking for rate increases based on reassessed property values to be suspended until the objection process is finalised. 

However, to date, the city has not responded to its letter. In a briefing before the various rates implementation on 1 July, MMC of Finance, Dada Morero, said the city is striving to subsidize more residents who are unable to afford the high costs of municipal services. However, hikes are unavoidable as the city is buying bulk services such as electricity and water at a very high cost.

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