Countdown for home owners
Cape Town property owners are due to view the 2012 general valuation roll next month, writes Anna-marie Smith
ONLY three years have passed since Cape Town’s previous general valuation of 750,000 properties took place in 2009. This resulted in the June 2011 announcement of rates assessments based on cents in the rand of 0.006062 for residential properties, and rebate of R200,000.
Ian Neilson, executive deputy mayor and mayoral committee member for finance, describes regular valuations as wise, as long periods between re-valuations result in significant shifts in values. He says: “That is why the city has chosen to have another general valuation after three years since there have been shifts in the property market over the period. The new general valuation has a valuation date of 1 July 2012 (GV2012) and will be implemented from 1 July 2013.”
Such shifts were seen in the hugely inflated house prices during the 2007 boom, followed by historic decline to rock bottom in 2009. The FNB House Price Index data shows real price average growth (after inflation) nationally at 2.3% higher in 2010 than in 2009, and average house price growth of 3.3% in 2011, and 5% in 2012. From 21 February owners will know market values of their properties as seen from the City’s perspective, when the GV2012 of 800,000 Cape Town properties is published.
To achieve fair assessments, the Local Government Municipal Property Rates Act no 6 of 2004 states that all properties on the valuation roll must be valued at market value, defined as “the amount the property would have realised if sold on the date of valuation in the open market by a willing buyer to a willing seller”.
However, what constitutes market value remains a conundrum to property owners. For most the best of both worlds would mean maximum asset value as well as fair treatment when it comes to paying rates and taxes.
And so, to enable a fair process Neilson says the city’s team of valuations staff, all qualified and registered professionals as required by the act, have been collecting and reviewing sales that took place since July 2009. The municipal valuer uses sales data in the computer-assisted mass appraisal of properties, a computer aided analytical procedure used by trained professional valuers, that “makes valuation cheaper and faster, but no less fair”.
Also playing a vital role are private industry operators such as professional valuers and qualified property professionals, gearing up to provide owners with independent valuations. When objections to the city’s valuation are lodged, and values remain unchanged, an appeal may be submitted to the Provincial Valuation Board for reviewing by an independent body of professional valuers.
Eugene Pienaar, franchisee for Rawson Properties Constantia/Wynberg franchise, says the upcoming role could lead to many home owners who previously held unrealistic views of values now realising lower current market values. Pienaar says market values could be as much “as 20% lower than it was at the peak period of 2007-early 2008”.
The public inspection and objection period starts on February 21 and ends on April 30. Owners have to ensure that valuation certificates reach them by post, says Elizabeth Laing, the city’s manager of valuations, by providing correct postal addresses. Those not in receipt of certificates can view the roll online or at an objections centre as listed on the city’s website, and acknowledgement notices are issued for every objection received.
Neilson says legislation does not make provision for late objections after the close of the objection period on April 30 this year.
Cape Town home owners are bracing for the next round of regular valuations of their properties to be released.