The City of Cape Town requires finance to run the city. Each year it passes a budget and votes how it is going to raise this money from various sources. These are property rates and taxes, charges for water supplies, refuse removal, sewerage removal and disposal, electricity supplies and sundry other minor sources.
The total budget allocation from property rates is divided by the total new general valuation (GV) of all ± 750 000 properties of all types in the Unicity and this is how the City calculates the Rate in the Rand which is multiplied by your agreed valuation with the City to calculate your rates bill before rebate reductions if applicable.
The City of Cape Town has recently re-valued all the properties in the Cape Town Unicity in its Municipal General Valuation (GV) which was carried out as at 1 July 2009.
It is has recently been posting its revised draft valuation of your property on
the City’s website (www.capetown.gov.za) and you should have received a notice from the City in the post officially notifying you of this re-valuation with a request that you either accept it or object to it by the end of Aril 2010.
On the City's website you can access the details of your own property and the localities of sales in your area which you can use for your objection should you elect to make one.
How do you do this ?
Look up the City’s website at
Once on the website, look for and click on :
Services and departments - “P” Property Valuations - “Welcome to the Property Valuations Website” - Search the Valuation Roll and click on the Valuation Roll for 2009 (at the bottom of the page) - and then find your valuation by entering one of the following after clicking on the relevant heading :
* Site address (Number and street name)
* Erf number (You will be then presented by all the same erf numbers as yours in the Unicity – scroll down by using the consecutive numbers on the bottom left hand side of the page until you find yours) This is the easiest access method.
* Farm
* Sectional title (Property name and unit number)
Your valuation will show :
Valuation reference
Erf number and suburb
Owner’s name
Rating category (eg rebated or not rebated - you will not get a residential rebate if you are running a business from home eg B & B, catering or hairdressing business)
Your rates bill has increased by 25% compounded, based only on the increases in the Rates in the Rand over the years since the last GV in 2006 while the valuations agreed then were not increased.
Therefore, if your new valuation is not exceeding 25% higher than your 2006 valuation, there will be no need to object – your rates bill may even come down if the new Rate / Rand decreases, as may well happen, when the budget is announced.
However, to assist you in your deliberations as to whether to object or not, click on your left hand column Valuation Reference Number and there will appear the details of your property on which your new valuation was based.
If the information is wrong and to your detriment, you can bring this to the City’s notice in your objection.
In addition, by clicking on the “View Sales” wording on your details, you can get the details of many comparable sales in your property’s area, which you can use in your objection if needs be. These details include :
Address
Erf No / suburb
Usage – ie One dwelling residence
Site area
Sale date
Sale price
The City states on its website that it has all the details of the sold properties for you to use but these are not yet on the website. Rather go and get them at the Civic Centre Information Centre.
One very important development is that, if you are objecting, you will now not have to pay interim rates bills based on the City’s valuation until your objection has been agreed with the City. You must, however, go to the Valuation Departrment and negotiate a reasonable interim payment basis (say the old rate plus 10%) until your objection is responded to and you and the City have agreed your revised valuation.
Also, be careful only to object on strictly sound technically correct submissions, because you may well be charged for the Valuation Court’s costs if it considers that the City’s refusal of your initial objection was rejected by you for emotional or frivolous reasons.
You should now be establishing the factors / characteristics of your
property which you can use to motivate a reduction in the valuation should
you now feel that you have been overvalued.
Typical examples could be : a Council registered water course (river!) -
immense rocks which eliminate your ability to develop further on your
property as owners around you can with double / second dwellings, granny
flats and the like - the presence of a large overloaded Provincial
registered trunk road on your front boundary which has excessive and
dangerously speeding traffic on it and causes you difficulty in
accessing / leaving your property by car for some hours during rush hours
- the exposure to high winds and possible harm from fires in adjacent public open spaces, etc.
Other examples could be : a Council electrical or drainage servitude
running through your property, a lack or loss of views compared with
surrounding properties – steeply sloping sites - irregularly shaped sites
inhibiting the ability to develop them properly or take advantage of the
available view – a south facing house - excessive distance from shops,
schools, beach etc. necessitating wheeled transport for every journey –
obliteration of views by adjacent building structures, an old house which needs high maintenance / restoration costs, the recent erection of a massive new block of flats which has derogated from the property values of adjacent affected neighbours, and so on.
Once you have received your Council revaluation notice and before you rush
into submitting an objection because you think it is too high, ask yourself
carefully whether you would have been prepared to HAVE SOLD your property in July 2009 (the date of the revaluation) for an amount less than the Council’s revaluation now presented to you in 2010. Only if you would have been prepared to have accepted such a lower selling price (including the Selling Agent’s fees and VAT) and are convinced that the valuation is too high, should you then consider deciding whether to consult a qualified Valuer or Estate Agent who will then be able to advise you as to whether your suggested lower valuation is valid or not.
Some people have had their 2006 valuation increased by well over 100%. even up to 200% and are feeling very indignant.
A word of caution here.
You may well have been badly undervalued last time and the City is now correcting its previuos mistake, which it is quite entitled to do – and you really did not choose to object last time , did you, because you were so delighted at the then “very fair” valuation and your chickens are now coming home to roost ?!
Do not waste time comparing your new valuation with your existing one. Rather get good advice as to whether the new one is Market value or not, by using the existing sales records and getting the advice of the proper professionals. Get this advice from Valuers and Estate Agents.
Remember, seeing that you have access to everyone’s valuations, you are quite entitled to object to the City that you are of the opinion that a property you have noticed seems to be undervalued – the City welcomes this approach. If it has been incorrectly undervalued, it will be revalued higher at the City’s next supplementary valuation. Of course anyone is entitled to object to what they consider to be an undervaluation of your property!
Should you decide to approach a Valuer for professional advice, first request a fee quotation (probably on an hourly rate or percentage basis) before investigating with him/her as to whether your contention that the re-valuation is too high is valid or not. If the Valuer disagrees with you, you have at least been given a quick and reasonably inexpensive professional opinion upon which you can decide whether to proceed with your objection or not. Should you be advised to or should you decide to proceed, you should then appoint the Valuer to assist you with your objection to the Valuation Court.
Conversely, you can ask him/her to execute a full valuation on your property which will be extremely useful in backing up your objection.
Estate Agents are also able to assist you with your objection and can help you considerably by presenting you with their written assessment of what your property would have sold for in July 2009 based on their own relevant sales records..
The objection document is a very daunting document. CBRRA therefore suggests that you do not submit an objection without a technically correct motivation which is well prepared with professional help.
The South African Institute of Valuers can assist you with names of Valuers (Address c/o J.J.Hofmeyr & Sons, 13 Piers Road, Wynberg, 7800. Telephone 021 7611803).
Alternatively look up the Yellow Pages.
Should you decide to object to the new revaluation which you have received, the document which you will shortly be receiving or have received from the City will inform you where it has opened information centres which will assist you in the compilation of your objection. At these information centres, you will be able to ascertain the sales amounts and other details of the properties near your property to enable you to make an accurate comparison between such sold properties and your property.
Remember that if you live in a sectional title apartment block, you will again be billed separately and directly for your unit and not in your levy which used to reflect a proportion of the overall building rates bill.
Should your valuation have increased, this does not necessarily mean that your rates bill will escalate pro-rata to the valuation increase.
This is because the increase in the total overall value of all properties in the Unicity since July 2006 will probably mean that the Rate in the Rand may be adjusted down in this GV year. The current recession may even have had its effect on the new valuations, but this movement will differ from one suburb to another depending on the situations and market attractiveness of such suburbs. It could well happen again in this GV that in some areas the new rates bills in July 2010 may result in lower rates bills in some areas and much higher rates bills in others. Some people have received the same valuation for 2009 as they did in 2006. This proves that the City has taken the recent recession into account.
This big differential in increases or decreases in GV valuations was considered to be a basic big flaw on the last GV and it will be interesting to see what happens this time – ie, has the City managed to improve its rating system so that all ratepayers are treated equally in their new rates rates valuations so that the new GV can be seen to have been equitable to all in terms of the Municipal Property Rates Act No 4 of 2004.
Ideally there should not be a situation which happened in the 2006 GV when of about 750 000 properties valued, 16% received reduced valuations, 50% received increased valuations by not exceeding 15%, 27% increased by between 15% and 30%, 5% increased between 30% and 40% and 2% increased by more than 40% some even up to 325%! Assuming that nobody whose valuations had increased by more than 15% would have objected, only about one third of the
above total valuations would have been objected to, ie ±250 000 divided by ± 55 000 actual objections = ± 22%, which was far in excess of the City’s then claimed 8% objections.
For the next few years until the next GV, your new revaluation will stay constant (unless it is adjusted by a supplementary valuation by the City in due course) and future rates bill increases will be based only on the Rate in the Rand applicable to your property.
One way or the other, be aware of your rights and, because of increased costs of running the Unicity and possibly increased inflation, start preparing to possibly pay more rates than the normal recent annual increases from July 2010 onwards, the extent of which will only be revealed to you after the forthcoming Council rate / Rand is announced by the City when it announces its next budget this year.
John Powell
Vice Chairperson
CBRRA (Camps Bay Ratepayers and Residents Association)
