New municipal rates lead to many queries

Posted On Friday, 22 February 2013 07:19 Published by eProp@News
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The Cape Town City Council’s current revaluing of residential property has, as previously, resulted in his property group being flooded with questions from the general public as to the accuracy and reliability of these rates – and, in many cases, the policy on which the Council appears to be working.

Bill Rawson

According to Bill Rawson, Chairman of the Rawson Property Group, “the valuing appears to be satisfactory but it is interesting that almost all home owners and business associates who I have discussed this matter with have said that they would never sell their properties at the Council valuations – because the homes have been undervalued in relation to market values.”

On the other side, he said, there are, and always will be, a number of home owners – especially those in affluent micro markets where the valuations are by no means similar to other areas – who complain, often with great bitterness, that their homes have been overvalued and consequently their rates are far too high.

Giving an example, Rawson said that a vacant plot in Hout Bay with no sewerage or water connections on it as yet has been valued at R1,8 million, when in today’s market it would not fetch more than R1 million.

Upmarket homes, he said, are the ones most likely to be overvalued in this way and the problem here is that valuations take too little account of the recessionary conditions of the last four years.

Such valuations, said Rawson, can be further complicated by considering the current replacement value or by including in the valuation standard annual escalation rises, which in recent years have often no longer been applicable.

Although there are varying disagreements about valuations, and these can often be challenged, added Rawson, there is almost a universal agreement that the service given for the steadily increasing rates charged is unsatisfactory – and has deteriorated in recent years.

Most of his colleagues and business associates, he said, accept that, as happens elsewhere in the world, the rates on affluent homes have to be raised to subsidise the services and new home developments in the poorer areas. However, there too, the services are often inefficient and the much publicized speed-up in housing delivery is not yet evident to the average man-in-the-street.

One of the Council services which, added Rawson, is most inadequate and a cause of great frustration to home owners and developers is the scrutinisation and approval of building plans.

“The delays here are simply unacceptable,” he said, “and it is possibly time that some of this work was outsourced by the Council to competent professional bodies acting on strict guidelines but with bonus incentives for speed. This is the system applied in many European countries and, I am told, it works very well.”

Last modified on Thursday, 13 March 2014 10:14

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