It is essential to have an understanding of the General Valuation Roll and its implication on municipal rates and property values. The City of Cape Town conducts a general valuation every three years in order to prevent large fluctuations in property values between general valuations.
Homeowners and Landlords are advised to consult with their real estate agents at Grosch Properties who are able to arrange a property valuation at regular intervals which allows owners to improve properties in line with the supplementary valuation roll.
Many prospective buyers and sellers often wonder what is the difference between a property’s municipal value and the market value of a property. As defined by the South African Institute of Valuers:
The “market value” is defined as “the amount a property would have realized if sold on the date of the valuation in the open market by a willing seller to a willing buyer”. A municipal valuation of the property can be obtained from your local authority, but often this figure is not a reflection of the value of the improvements and alterations that you have made to your home.
The last General Valuation Roll 2018 billing took effect on 1 July 2019 containing 875 000 registered properties. The City valuer makes use of a computer modelling programme called Computer-Assisted Mass Appraisal (CAMA) which uses sales data, aerial imagery and other property information (eg. property location, size, number of rooms, outbuildings etc) to determine the market value (municipal value, which also determines rates and taxes) of a property. These results are then reviewed by professional property valuers and adjusted if necessary. Valuations are not based on speculation but on the market value of the property, however, they can be objected based on additional circumstances provided by the owner and a separate professional valuation.
The supplementary valuation roll is the assessment of changes to a property that occur during the lifecycle of the general valuations roll. As part of the supplementary valuation, the City will revalue property that has changed, for example, if a house has been built on a vacant piece of land. This also applies to changes in zoning, such as from residential to business.
Understanding the importance of the consequences of a general valuation by homeowners serves them well, especially in consultation with their Grosch Properties knowledgeable agents. If your property has a lower valuation it could mean a lower offer should you want to sell the property in the future. Together with your experienced property agents, you are able to ensure your property value remains at a good price. Regular property evaluations, even during the Alert Level 3 Lockdown restrictions and going forward, affords Grosch Properties’ agents the ability to advise accordingly (i.e. size of the erf, area the property is located, safety and security, proximity to schools, roads and shopping centres).
Often overlooked is the condition of the pavement and overall property appeal. Valuators consider the outward appeal of the property as a reflection of the rest of the property. As a homeowner you are encouraged to maintain even minor “cosmetic” touches to the home both inside and out to assist with the value of the overall property should you wish to sell in the future.
During the next general valuation, you are able to make objections during the given timeframe if you feel that your property is under or overvalued. It is best to speak to your property agent now for further advice for the next upcoming general valuation or property valuation.