Editor's note: The recent rate hikes in Johannesburg has gotten some people extremely upset and rightly so with some properties being valued at 5000% their previous value. Briefly.co.za editor, Stefan Mack, investigates the situation.
Johannesburg residents have been subjected to a rate increase which in some cases is in excess of 5000% their previous valuations.
A case in point was a building in the CBD which had a rate increase of 700% with the property's value being adjusted from R3-million to R25-million.
Property owners Roger and Doreen Hemp's house was re-evaluated from R2.28-million to a staggering R116-million. This equates to a 5000% increase in their property value. It just doesn't make sense, they live in a "normal" house, not a palatial mansion.
Not an isolated incident
The recent increases are affecting a large portion of the population. 8000 properties have been reevaluated, part of a much larger amount. So far 4000 objections have been received regarding the rates increases.
Mayor Herman Mashaba has said that those people who received an increase would get a section 78 notice with revised valuations.
Get rich quick scheme
This is where the problem lies, once the valuations have been completed the owner of the property must pay the rates and taxes in accordance with their property value.
They can object but they are expected to pay the new rates until the valuations are revised. Somebody, perhaps the municipality itself may be using this as a way to generate some extra income at the expense of its residents.
A petition has been started called #RatesMustFall in a bid to halt and reverse the valuations.
What makes the entire situation so untenable is the seemingly haphazard manner in which the rates have been adjusted. For example, a block of flats was valuated at R3.4-million in 2013, the recent increase estimated the property being worth R20.4-million. Another block of flats which had not yet received a valuation was valued at R35.5-million.
A shell of a building which had been vandalised and gutted was valued at R5000 before and was valued now at R305 000.
For a property owner who has tenants, he or she cannot be expected to pass these huge increases onto the tenants who would never be able to afford them in any case. This has caused a serious problem in the rental market.
Mike Lingwood, a property developer, has advised people to take photos of their properties showing the condition of their house, bathrooms, kitchens and anything which could show the value of the property and submit them when they make their appeal as supporting documents.
The views and opinions expressed here are those of the author and do not necessarily reflect the official policy or position of Briefly.co.za.
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