Rate hikes hitting major cities in South Africa – how much more you’ll pay in Joburg, Cape Town and Durban

 ·24 May 2023

Property rates have increased across South Africa, with the exception of Cape Town, which reduced its rates by 1.1% – and with the completion of the general valuation roll in 2023, these rates could put South Africans under more financial pressure.

The general valuation roll (GVR) is conducted every four years to update property values which are then used to adjust the rates residents pay for their homes.

Municipal property rates are calculated by multiplying the market value of the property – as reflected in the valuation roll – by a cent amount in the rand rate that a municipal council has determined.

These new rates will come into effect from 1 July 2023. 

However, irrespective of the outcome of the GVR, all qualifying properties, at minimum, will pay the property rate as determined by the cent amount in the rand rate.

This means that if your property’s value remained unchanged after the GVR, you still have to pay the determined annual increase of the municipal rates.

For example, if your property’s value remained unchanged, Joburg homeowners would still have to pay a 5.3% increase, Tshwane (5%), and eThekini a considerable 8.9%.

Notably, Cape Town homeowners will be the only South Africans to see a drop in property rates – a decrease of 1.1% from 1 July 2023.

The increases in municipal property rates for several prominent municipalities in South Africa for the 2023/24 financial year are given in the table below.

Municipality Rate change (1 July 2023)
City of Joburg 5.3%
Tshwane 5.0%
eThekwini 8.9%
City of Cape Town -1.1%
Ekurhuleni 4.4%
Nelson Mandela Bay 5.0%
Buffalo City 8.0%

Other factors affecting the amount of tax you pay are the statutory R15,000 exemption for all properties (according to the Municipal Property Rates Act) and any rebate determined by the respective municipality’s property rates policy.

For example, Joburg homeowners will not pay tax on the first R300,000 of the market value of a property, while Durban residents are only afforded R120,000 of the market value not taxed.

The City of Johannesburg has reduced its rebate by R50,000 from R335,000 to R285,000 for the 2023/24 financial year. In 2022/23, homeowners currently do not pay tax on the first R350,000 (including the statutory R15,000 exemption).

Again, Cape Town homeowners will be the only South Africans to see an increase in these exceptions and rebates. From 1 July, the rebate for all properties valued under R5 million will increase from R285,000 to R435,000 – an increase of 52%.

This is in addition to the statutory R15,000 exemption for all properties, which means the first R450,000 of those residential properties’ values will be exempt from tax.

Considering this, and depending on the outcome of the GVR, the municipal rate changes that homeowners in Joburg, Durban, and Cape Town can expect to pay per month based on their property value from 1 July 2023 are given in the tables below.

City of Johannesburg

Property value 2023 2024 (from 1 July 2023) Change
R800 000 R323 R378 +R55
R1 000 000 R467 R529 +R63
R1 400 000 R754 R832 +R78
R1 800 000 R1 041 R1 135 +R93
R2 000 000 R1 185 R1 286 +R101
R2 400 000 R1 472 R1 588 +R116
R2 800 000 R1 760 R1 891 +R131
R3 000 000 R1 903 R2 042 +R136
R3 500 000 R2 262 R2 420 +R158
R4 000 000 R2 622 R2 798 +R176
R4 500 000 R2 981 R3 177 +R196
R5 000 000 R3 340 R3 556 +R216

Durban – eThekwini 

Property value 2023 2024 (from 1 July 2023) Change
R800 000 R671 R730 +R59
R1 000 000 R868 R945 +R77
R1 400 000 R1 262 R1 375 +R113
R1 800 000 R1 657 R1 805 +R148
R2 000 000 R1 854 R2 019 +R165
R2 400 000 R2 249 R2 449 +R200
R2 800 000 R2 643 R2 879 +R236
R3 000 000 R2 841 R3 094 +R253
R3 500 000 R3 334 R3 631 +R297
R4 000 000 R3 827 R4 168 +R341
R4 500 000 R4 320 R4 705 +R385
R5 000 000 R4 814 R5 242 +R428

City of Cape Town 

Property value 2023 2024 (from 1 July 2023) Change
R800 000 R264 R183 -R81
R1 000 000 R370 R288 -R82
R1 400 000 R582 R497 -R85
R1 800 000 R793 R706 -R87
R2 000 000 R899 R810 -R89
R2 400 000 R1 110 R1 019 -R91
R2 800 000 R1 322 R1 228 -R94
R3 000 000 R1 427 R1 333 -R94
R3 500 000 R1 692 R1 594 -R98
R4 000 000 R1 956 R1 856 -R100
R4 500 000 R2 220 R2 117 -R103
R5 000 000 R2 485 R2 457 -R28

Additional rate hikes coming for South Africans 

While these increases seem manageable, including the welcome relief for Capetonians, there is no doubt that 2023 will bring further financial pressures for South Africans when you consider the additional rate hikes homeowners will be dealt with.

Several major metros in South Africa have tabled their draft budget proposals for the 2023/24 financial year, revealing hefty tariff increases for residents alongside the abovementioned property rates – including electricity, water, sanitation, and refuse removal.

Addressing the reasons for the proposed tariffs, many of the municipal mayors said that above-inflation Eskom, water board, and salary increases have made tariff increases inevitable.

However, some residents in South Africa are posed to step into deeper waters than others, with eThekwini Metropolitan Municipality drafting the steepest increases.

Although electricity price hikes are mostly in line with Eskom’s 18.49% increase approved by Nersa, eThekwini drafted a massive increase compared to other major metros. At the same time, the City of Cape Town has managed to shield its residents slightly.

eThekwini tabled a whopping 21.91% electricity tariff increase – 3.32% higher than Eskom’s 18.49% municipal hike – while its water tariff is set to increase by a notable 14.9%.

eThekwini Mayor Mxolisi Kaunda said this is a result of Umgeni Water’s approved tariff increase for bulk water is around 13%, although no explanation was given for the massive electricity increase.

On the other hand, the City of Cape Town has reduced Eskom’s 18.49% municipal rate increase to 17.6% by absorbing about R15 million a month.

According to Cape Town’s mayoral committee member for finance, Siseko Mbandezi, about 70% of Cape Town’s tariff income will go towards buying bulk electricity from Eskom, with the remaining 30% invested in service delivery and ending load shedding.

These additional rate hikes are tabled below. It must be noted that the City of Ekurhuleni’s planned increase in residential electricity tariffs by 15% was tabled before Nersa pronounced Eskom’s municipal tariffs, which leaves room for adjustments.

Municipality Electricity Water Sanitation Refuse removal
City of Joburg 18.65% 9.3% 9.3% 7%
Tshwane 18.0% 9.2% 9.2% 6%
eThekwini 21.9% 14.9% 11.9% 8%
City of Cape Town 17.6% 8.6% 8.6% 5.5%
Ekurhuleni 15.0% 12.0% 5.3% 5.3%
Nelson Mandela Bay 18.49% 6.0% 6.0% 6.0%
Buffalo City 18.65% 9.86% 5.3% 5.3%

Read: What a R2 million home looks like in Joburg vs Cape Town vs Durban and more

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