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Monday Feb 18, 2013

Joburg property valuer warns 'rates holiday' is over

Piet Eloff 's fourth floor office at the Braamfontein Civic Centre offers only a limited view of the vast and sprawling city of Joburg.

But the council's property valuer doesn't need to see the rest of the city from his office window, he keeps an eagle eye on the city's sprawl, almost a million properties valued at R912 billion.

Joburg ratepayers faced with higher rates bills have often directed their anger at Eloff 's office, accusing it of charging exorbitant rates to raise income for the ailing council coffers.

From this week, a new property valuation roll will be open for inspection to the public, with some residents in for a shock with rates and taxes increases of up to 50 percent.

And this time even RDP houses that may not have been valued in 2008 will have a value of up to R200 000 attached to them which will deter mine their rates.

A general valuation roll, which is compiled by municipalities every four years, is intended to get income for the council but also to provide an equitable basis for charging rates, according to Eloff.

The current valuation roll was compiled in 2008, but it has been amended regularly.

The new valuation roll compiled for the next four years will be implemented from July.

The equitable property tax rating meant people in poor areas, where property values were lower, paid less tax than people in affluent areas.

Eloff said Joburg started collecting property data for the new valuation roll in 2010 - the size of the property, where it is located, attributes such as swimming pools, security of the property, its condition and whether it is situated on a busy road.

"Then the valuer will go out and do a market and sales review. You will visit areas and say which areas are comparable, look at sales (of properties) in those areas, inspect them and analyse the sales to say what will a property sell per square metre," he explained.

Valuation modelling would be performed during which the average size and selling price of residential properties in a specific area are determined.

He said the model a valuer built of one property was compared to all other properties in the area to provide the value of the other properties.

Eloff said all property owners in Joburg had been send notices of their latest property valuations and that they would be given notice of addresses of the centres where they could look at the roll.

They could lodge objections to the valuation over a 30-day period.

He said the increase in the value of properties overall despite some claiming that the market had declined, was because the properties were valued on a cost basis.

Property values had increased because building costs had increased in the past five years.

"When we value the property we deter mine market value but what is important is the date of the valuation."

The new valuation roll was compiled using the market value of properties in July last year.

The market value of a property was determined by what a willing buyer would pay to a willing seller on the date of valuation in an open market, Eloff added.

What validated the municipal valuation in his eyes, was that an independent company had assisted them in compiling the valuation roll.

He conceded valuers could not gain access to all properties and therefore had made assumptions that certain features of houses in the same area were standard.

The city, he said, was trying to be within 10 percent of the value of the property assessed and that was within nor mal standards.

He conceded measuring errors might have been made in data collection, l eading t o wrong valuations.

In such cases owners should object to valuations.

Elof f war ned that some proper t y owners who had "rates holidays" for four years because of lower valuations would cry foul when their rates were being corrected now.

"Look at the value of your property and object if you feel it is too high, but if you miss this boat you are going to suffer the consequences."

Joburg's 2012 Valuation Roll by numbers:

  • 176 valuation roll books

  • 812 768 - the number of valued properties in Joburg

  • R912 billion - the total value of the properties

  • Residential properties and sectional title account for 75 percent of the roll

  • 446 450 - the number of residential properties

  • 137 432 - the number of sectional titles

  • 246 088 - the number of non-residential properties

  • 6 036 - agricultural properties

  • 48 percent of residential properties are under R250 000 in value

  • 20 percent - of residential properties are over R1 million

    Saturday Star

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