Cape Town - The property industry has welcomed the City’s 52% rates relief increase for all residential properties under R5 million, which sees the zero-rating of the first R450 000 of property values for homes under R5m, as a relief for lower and middle-income ratepayers.
During a special council meeting on Friday, the City passed the rates relief increase which represents a major R150 000 increase to this exemption benefit to assist lower and middle-income ratepayers.
The increase for properties to be exempted from paying rates will result in homes between R450 000 and R5m paying R147 less in rates per month, while homes worth over R5m will pay R147 more for rates per month.
The council also approved a plan to help more pensioners and social grant recipients benefit from rate rebates, by raising the upper qualifying limit from R17 500 to R22 000 total monthly household income, with effect from July 1.
These relief measures form part of a package of General Valuation policy proposals. The council said final proposals would be reflected in the City’s 2023/24 Budget to be tabled to council in March for public participation.
Lew Geffen Sotheby’s International Realty chief executive Yael Geffen said homeowners servicing bonds of R2m had seen a staggering R4500 increase in their monthly repayments in the past year.
She said as a result, people had been squeezed out of their homes and lost their life savings.
“However the City’s move will give thousands of households that really need it, slightly more breathing space.”
Harcourts SA’s chief executive Richard Gray said the move by the City was a welcome relief for people struggling to make ends meet.
“While other cities may be tightening their belts and reducing support for residents, this move by the City stands out in contrast to the other large metros, where we are seeing the opposite trend.”
Welcoming the move, Stop CoCT founder Sandra Dickson however said: “Though the rate-in-rand decreased by around 1%, the City says nothing about the looming property rates increase which will be announced in March when the draft budget is published for public comment.”
Nevertheless, Dickson hailed the increase of the cut-off for pensioners to qualify for a rates rebate.
“This will bring some relief to the narrow band of pensioners that have an income below R22000.”
During the discussion on the rebates, Freedom Front Plus Councillor Paul Jacobson gave the example of two Atlantic Seaboard properties on the same street, one refurbished to a high standard and the other derelict, and questioned why both properties paid equal rates.
DA councillor Annelize van Zyl defended the City and said none of the FF+ councillors attended the rates briefing session on Thursday even though it was especially organised for opposition councillors.
“So how can they even know what they’re talking about? They only know how to misrepresent the facts.”
mwangi.githahu@inl.co.za