Cape Town ratepayers challenge rising municipal costs amid housing inequality - IOL

Cape Town ratepayers and civic groups say rising property valuations, municipal charges and housing costs are worsening affordability.

Cape Town ratepayers and civic groups say rising property valuations and municipal tariffs are placing growing pressure on households, but the City of Cape Town has defended its relief measures and lowest-cost claims.

The City has long boasted that it has the highest service-delivery ranking among metropolitan municipalities according to research by the Good Governance Africa’s 2024 Governance Performance Index. 

While the municipality insists that it maintains the lowest overall basket of municipal costs among South Africa’s major metros, civic organisations warn that soaring property valuations and rising tariffs are placing unsustainable financial strain on households.

Bas Zuidberg, chairperson of the Cape Town Collective Ratepayers’ Association (CTCRA), said a rates-affordability crisis was rapidly approaching.

“Indeed, it is being exacerbated by the results of the Municipal Valuation Roll, which are causing grave concern in areas that have seen average increases that far outpace the municipal average,” said Zuidberg.

He said anecdotal evidence indicated that more residents had been unable to afford their rates bills since charges for the new financial year took effect on 1 July, amid increased property valuations.

Zuidberg said the association believed the City was not focusing enough on affordability.

“Proof of this can be found in the fact that not only is total expenditure set to increase by 20% over the coming three years, but the portion funded by ratepayers is also set to increase from 68% to 72%,” he said.

“Since the number of households is not expected to increase by more than 5%, this essentially means that ratepayers are looking at an average increase of about 10% annually. That excludes the effect of another valuation round expected in 2029.

“The City is forging ahead with planning for expenditure and then looking at ways to recover that expenditure — more and more from ratepayers. This mechanism is unsustainable.” 

The association and AfriForum recently took the City to court to challenge its use of property values to determine fixed municipal service charges.

In April, the Western Cape High Court ruled that the City’s 2025/26 fixed charges for water, sanitation and citywide cleaning were unlawful and invalid, finding that linking tariffs to property value rather than actual consumption was unconstitutional.

“What we would like to see is that the City puts in a lot more visible effort to reduce its expenses and shift the burden away from ratepayers. Only then can Cape Town truly be ‘a city for all’," Zuidberg said.

Reiterating these concerns, Eerste River resident Donald Lewis, who has owned his property for the past 10 years, said rising rates were placing increasing pressure on households.

“It’s not just me. They are taking a toll on the poor, the middle class, and affecting the cost of living and how people have to budget. My rates and taxes have increased to such an extent that they are nearly 50% of the bond I am paying. I feel like the City is contributing to poverty and creating a situation where households can no longer afford their rates and taxes,” he said.

Siseko Mbandezi, Mayoral Committee (Mayco) Member for Finance, defended the City of Cape Town’s tariff structure, saying it offers the “highest rates relief and widest pensioner and indigent benefits” among the country’s five biggest metros.

He said indigent households could qualify for a 100% rates rebate and free basic water and sanitation, while pensioners earning up to R27,000 a month could receive rates rebates of up to 100% and lifeline electricity benefits.

Mbandezi also said the City’s total municipal bill was the lowest across different property values when rates, water, electricity and refuse charges were taken into account. Based on its own comparisons, the City said households could save between R264 and R903 a month on an R800,000 home, rising to as much as R9,657 a month on a R15 million property.

“Cape Town offers the lowest property rates with a vastly lower property rates formula (rate-in-the-rand) compared to other cities. This means that, even with higher property values in Cape Town, you’re still likely to pay less here, while living in a city that works,” he argued.