Rise in Cape Town property values could mean increase in rates

Property values in the metro have increased by between 10 and 12 percent on average since the last valuation three years ago, with the biggest growth on the Atlantic Seaboard.

But while property owners may be delighted at the appreciation of their assets, they could face paying higher municipal rates bills in the new financial year.

A team of city valuers and data collectors has spent recent months assessing the values of 780 000 rateable properties in the city, and from mid-February ratepayers should start receiving notices informing them of the values allocated to their properties.

Along with the values, an indicative "cents in the rand" figure will be given to help ratepayers plan for the rates amount they are likely to be charged from July 1.

However, the final figure will be available only once the end of the budgeting period is reached in May.

Valuations director Chris Gavor told the Cape Argus that modelling was being done to determine how valuation increases would affect rates, but said it was not yet possible to comment on how ratepayers would be affected.

While property values determined how much owners paid in rates, an increase or decrease did not necessarily translate into higher rates.

He said commercial properties had also increased in value, and could end up absorbing the impact of the improvement in the residential sector.

Commenting on trends identified during the valuation process, Gavor said some properties had decreased in value, while others had grown.

The only area that had increased "hugely" was the Atlantic Seaboard, particularly the V&A Waterfront and Clifton.

He said shifts in rates payable would be "neighbourhood-based", rather than individual "property-based".

"So if the neighbourhood goes up, then the rates impact will be higher than in areas that remained constant," he said.

Gavor said property owners would be able to lodge objections to their valuations from February 22 until April 30, but warned that no late objections would be accepted.

He said it was not yet possible to identify those areas where property values had dropped, as the roll would be finalised only on Friday and at the moment only statistics were being compiled.

The city will open 18 inspection areas where ratepayers can seek assistance during the objection period.

Cape Argus

Posted at 10:16AM Feb 03, 2010 by Editor in Residential  |