What exactly are property rates?

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MisterBigglesworth

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I just got my municipal account for March, and it's broken up into sections "Property Rates", "Water", "Sewerage", "Refuse" etc. I know property rates are a calculation on the value of your house...but this property rate I have to pay each month, what is it actually used for? Why do we even have it, I mean I pay this amount each month...and I dont understand why?

Water, Sewerage, Refuse...now those are fine, they are services and products I use...but that money I pay monthly for my "property rates", what does the municipality use that money for? :confused:
 
What is property rates revenue used for?
Municipalities need a reliable source of revenue to provide basic services and perform their
functions. Property rates are the most important source of general revenue for municipalities,
especially in developed areas. Revenue from property rates is used to fund services that
benefit the community as a whole as opposed to individual households. These include
installing and maintaining streets, roads, sidewalks, lighting, and storm drainage facilities; and
building and operating clinics, parks, recreational facilities and cemeteries. Property rates
revenue is also used to fund municipal administration, such as computer equipment and
stationery, and costs of governance, such as council and community meetings, which
facilitate community participation on issues of Integrated Development Plans (IDPs) and
municipal budgets.

Municipal property rates are set, collected, and used locally. National and provincial
governments do not have the power to levy rates, nor do they share in the revenue collected.
Revenue from property rates is spent within a municipality, where the citizens and voters
have a voice in decisions on how the revenue is spent as part of the Integrated Development
Plans (IDPs) and budget processes, which municipalities invite communities to input prior
municipal council adoption of the budget.
Click to expand...
http://gis.tshwane.gov.za/documents/MPRA_FAQ's _2_.pdf
 
MisterBigglesworth said:
I just got my municipal account for March, and it's broken up into sections "Property Rates", "Water", "Sewerage", "Refuse" etc. I know property rates are a calculation on the value of your house...but this property rate I have to pay each month, what is it actually used for? Why do we even have it, I mean I pay this amount each month...and I dont understand why?

Water, Sewerage, Refuse...now those are fine, they are services and products I use...but that money I pay monthly for my "property rates", what does the municipality use that money for? :confused:
Click to expand...

Anything and everything, its a tax.
 
To pay for municipal employees to go for further training in not helping or resolving any query.
 
"These include
installing and maintaining streets, roads, sidewalks, lighting, and storm drainage facilities; and
building and operating clinics, parks, recreational facilities and cemeteries."

If only these were done properly.
 
Its essentially double taxation. Roads should be covered by fuel levies and tolls. Other infrastructure and salaries (including municipal salaries) should be covered by income tax and VAT. We just accept it so they keep collecting it, which is unfortunate.
 
That's everyone for the replies (esp Johnatan56) - now informed :D

Think our house has been overvalued...need to get an estate agent in to do an evaluation.
 
MisterBigglesworth said:
That's everyone for the replies (esp Johnatan56) - now informed :D

Think our house has been overvalued...need to get an estate agent in to do an evaluation.
Click to expand...

House evaluations were recently done again by CoCT. There is a process to launch an appeal if you are not happy. Go to their website.

Estate agent evaluation is pointless in this regard. It caries no weight with CoCT and will also be a lot more, meaning you will pay even more property rates anyway.

My CoCT evaluation was 700k less than what I was offered for my house November last year.
 
MightyQuin said:
House evaluations were recently done again by CoCT. There is a process to launch an appeal if you are not happy. Go to their website.

Estate agent evaluation is pointless in this regard. It caries no weight with CoCT and will also be a lot more, meaning you will pay even more property rates anyway.

My CoCT evaluation was 700k less than what I was offered for my house November last year.
Click to expand...

I agree with this. The less they value your house at, the better. You pay less rates.
 
Coct valuations are always less than the market value, in my experience. Think one should only object if council rates are close to market value
 
twaatie said:
Coct valuations are always less than the market value, in my experience. Think one should only object if council rates are close to market value
Click to expand...

They use a formula to value property in Joburg, it often results in values that are too high or too low. It is only accurate if you have a 100% average house in the suburb.

I recently had a problem where they valued my house at 50% over market value, which means very high rates. I eventually manged to get it corrected to some extent, still about 10% over market value though.

So it does happen, especially in Joburg. And the municipal authorities here are completely incompetent, so all sorts of weird stuff happens all the time, and it can take months, or even years, of effort to get it corrected.
 
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