By Maike Gohl, Partner; Lauren Squier, Associate and Katleho Selepe, Candidate Attorney
The recent occurrence of protest action experienced throughout South Africa has resulted in many buildings and properties being damaged. This has caused property owners to suffer substantial losses.
Following the protest action, the City of Johannesburg Metropolitan Municipality (“the City”) has invited affected property owners to make an application to have the municipal value of their properties decreased.
This article seeks to describe the process to be followed to have damaged properties revalued by the respective municipalities, in particular the City, so as to assist the affected property owners with a form of financial relief.
When is a property Revalued?
It is important to understand the basics of municipal valuation practices so as to ensure that the correct steps and actions are taken when an application to re-value a property is made.
Properties are ordinarily revalued when a property is placed on a General Valuation Roll (GV) or Supplementary Valuation Roll and the property owner then objects to the valuation thereon, during the inspection/objection period provided for in respect of the particular roll, usually a period of 30 (Thirty) days after the roll has been published.
Where a property owner misses the deadline to file an objection, there are other good reasons that municipalities can use to re-investigate and re-value/re-categorise properties, after the roll concerned has “closed” for inspection/objection. These are in terms of Section 78 of the Local Government: Municipal Property Rates Act 6 of 2004 (“the Act”).
Section 78 of the Act
Section 78 of the Act provides that a supplementary roll must be published at least once every year for each year of the duration of the GV. Section 78 contains a closed list of reasons for the inclusion of a property on a supplementary roll. These reasons essentially relate to properties that either did not exist when the GV was published or properties that need to be re-valued because their value has changed substantially.
Revaluation in terms of Section 78 (1) (d)
In terms of Section 78 (1) (d), a property owner can submit a Section 78 query, requesting that the City revalue a property because the market value has substantially changed since the last valuation.
This means that property owners who have had their buildings damaged during the recent protests, resulting in a decrease in the market value of the property, can approach the City to have these damaged buildings revalued according to their amended market values.
It is important to understand that the Valuation department takes the following considerations into account when an application for the revaluing of a property is made:
- Extent of damage on property;
- Duration of repair; and
- Cost of repair.
In deliberation of the application, the City’s valuers may potentially attend to the property for a physical inspection and, may assess the above factors which will influence the possible revaluation.
Should the City’s valuers, taking into consideration the relevant factors deem it appropriate and just to revalue the damaged property, the amended value will be published in the next Supplementary Valuation Roll. The rates charged based on the amended value will take effect from the date of occurrence (of the damage), up to the date on which the necessary repairs have been attended to and competed.
Submitting a Section 78 query
A Section 78 query is submitted in the prescribed form and supporting documents are annexed to it. The form and annexures are submitted to the City’s Valuations department who will then consider the query, attend to the inspection of the property and revaluation, should it be deemed necessary.
The property should then be placed on the next Supplementary Valuation Roll which will allow for the revaluation or alternatively will provide the owner with an opportunity to object to the disputed municipal value of the property to have the damages taken into account in reducing the value.
Property owners who have had their properties devalued due to damage incurred during the recent protest action experienced throughout South Africa can apply to have the City, alternatively, their relevant municipality revalues such properties. Any decrease in the municipal value of the property so obtained will incur a decrease in the property rates paid in relation to that property, as the same are determined by a calculation that takes the property value into account.
Schindlers Attorneys are specialists in municipal law and can attend to the submission of the Section 78 query on behalf of a property owner, ensuring that all of the information, supporting the need for a reevaluation of the property, is included in the query.
You can contact Schindlers Attorneys for assistance, via email at email@example.com or telephonically at (011) 448 9600. Please ask for Ms. Gohl or Ms. Squier if your phone in.
Please note: this article is for general public information and use. It is not to be considered or construed as legal advice. Each matter must be dealt with on a case by case basis and you should consult an attorney before taking any action contemplated herein.
Partner at Schindlers Attorneys
Phone: +27 (0) 11 448 9679
Associate at Schindlers Attorneys
Phone +27 (0) 11 448 9718
Candidate Attorney at Schindlers
Phone: +27 (0) 11 448 9600