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Succeeding in Municipal Valuation Objections:

Here are some guidelines on how to ensure the best possible results.

Make sure the property description is captured accurately in the objection form. The municipal valuer cannot correct a property description on your behalf and will dismiss the objection. An objection can also not be against multiple property entries in the roll. If an objection is required on multiple property entries in the roll, an objection must be lodged against each entry and cannot be grouped in a single objection form.

Only information reflecting in the general valuation roll can be corrected through an objection process. Any incorrect billing information must be corrected through a customer care centre or appropriate channels made available by your municipality.

Property information that must reflect in the valuation roll are,

  • Property Description

  • Property`s Physical Address

  • Property Use Category

  • Extent (Size)

  • Market Value

  • Owner/s Names

Additional information may be included by the municipality.

When an objection is submitted, give a clear indication of what the desired outcome is. By just indicating that the value is too high is not an adequate reason. Be specific. It could also be that the property was not included in the roll, which is referred to as an omission. Please still submit an objection, the property owner is still obliged to pay rates even though the property is omitted.

Property information needs to be supplied honestly, accurately and as complete as possible. By deliberately excluding crucial property information your submission could lose credibility and you could even face a cost order at a later stage.

Comparable property sales transactions used to motivate an adjustment in the municipal value must be relevant to the subject property and appropriate to the municipal valuation date. Typically, objection periods to the municipal valuation is between 8 to 10 months after the valuation date. Therefore, historic transactions, that occurred around the municipal valuation date, are required to accurately substantia a proposed value.

The objector must indicate his/her interest, whether the owner, a representative of the owner, third party or the municipality.

Objection forms need to be completed as thoroughly as possible and signed. If the objection form does not reflect key information the municipal valuer cannot consider the objection.

Please keep in mind that the more complete your objection is the better chance there is of getting a favourable result.

Objections need to be submitted within the allocated objection period. Late submissions will not be considered. However not all is lost if you missed the objection period. See the section on Supplementary Valuation Rolls.

The process of compiling, completing and submitting an objection might seem daunting but ValueCheck can help to make the process easy and worthwhile. Take the first step and register to get your free value estimate.

What are Municipal Property Values used for?

Municipalities generate most of their income from the services they offer (such as water and electricity), transfers from national government and from rates and taxes. Rates and Taxes are calculated using Municipal Property Valuations as a basis.

 

What are Municipal Property Values?

Under the Municipal Rates Act, municipalities must regularly determine the value of the properties within its boundaries. Simply, Municipal Values are the market values of properties determined at a specific time and updated typically every 3 to 8 years.

 

What process does a Municipality follow to update property values?

  1. Generally, most Municipality update their property values every 4 or 5 years. The values generated during this update are published in a General Valuation (GV) roll. An updated valuation roll must be fully implemented within 12 months of the General Valuation date.

  2. It is the responsibility of the Municipal Valuer to determine the Municipal values. He or she is supported by professional property valuers, statisticians and data collectors working for or hired by the Municipality. All values are determined at a specific date determined by the Municipality.

  3. The market value of a property is the amount that a willing buyer and willing seller would agree to in an open market sales transaction. This can be determined in a number of ways such as Computer Assisted Mass Appraisals (CAMA), Automated Valuation Models (AVM`s), physical inspections and desktop analyses.

  4. The General Valuation roll is usually finalized and published between 6 and 9 months after the valuation date. Updated valuations are usually sent to property owners at the start of the Objection period and/or can be viewed on the relevant Municipalities website.

  5. The Municipality then allows everyone a period (usually 1-3 months) to examine the General Valuation roll. This is known as the Objection period. During this period, if a property owner decides that they do not agree with the municipal valuation, they may submit an objection.

  6. Objections must be submitted to the Municipality according to the process outlined by the Municipality which is usually published on their website or explained in correspondence to Rate payers.

  7. The Municipality then considers all the objections it receives and either accepts the objection and corrects the error or rejects the objection and maintains its original assessment. This can take quite a long time to resolve and depends on the Municipality`s capacity and the number of objections it receives. The Johannesburg Municipality received over 50,000 objections to its 2017 GV roll and has taken over a year to process.

  8. Rate payers can appeal decisions made by the Municipality. The Municipality outlines the process and timelines to appeal objection decisions.

 
 

How do Municipal Property Values determine your Rates and Taxes?

A formula is applied to the Municipal Property Value to determine a property owner`s Rates and Taxes. As an example, the formula for the Johannesburg works as follows for a residential property valued at R1,000,000:

  1. Municipal Value = R1,000,000

  2. Reduction = R350,000 (all residential properties will be rated on the balance of the market value above R350,000)

  3. Rateable Value = R1,000,000 - R350,000 = R650,000 (this is the value to which the Annual Rates Tariff is applied)

  4. Annual Tariff = R0.007345 (this is the tariff applied to the Rateable Value)

  5. Annual Rates and Taxes = R650,000 x R0.007345 = R4,774.25 (this is the annual amount that the property owner must pay the municipality in Rates and Taxes)

  6. Monthly Rates and Taxes = R4,774.25/12 = R397.85 (this is the amount that should appear on your monthly Rates and Taxes bill)

What are the main problems Ratepayers encounter with Municipal Property Values?

  1. If your property is overvalued, you will pay higher Rates and Taxes than you should. If you don`t correct it, you will pay the incorrect taxes for up to eight years until the next General Valuation roll is done.

  2. My use category is incorrect, but my municipal value is accurate. I don`t have to do anything. Not true, the incorrect use category could result in four time the rates.

  3. My property is undervalued, I will pay less rates than what I need to. This is only true if all other property in the municipality is valued accurately. (See article on undervalued properties)

  4. iv. The municipal valuer never inspected my property. Municipal valuers are not required to inspect properties when valuing for rating purposes. The objection process allows for property owners to correct values when municipal valuers get it wrong.

 

How do I get my free Value Estimate from ValueCheck?

 

Follow the following steps:

  1. Go to our Home page and if you haven`t already, register. You will receive an email to confirm your registration before you can proceed. Your user name is your email address and you chose your password.

  2. If you have registered, you need to login to your account with your email address and password.

  3. Once you have logged in, use the property owner`s ID number to search for a property you want a value on. All the properties owned by that person will then be listed.

  4. Select the property you want a value on by clicking "View".

    • You will be asked to enter some information about the property - please complete this accurately as possible as it would be used if you choose to submit an objection to your value. Click on "Submit" to continue to the next step.

    • You will be presented with an estimate of your Property Value at the relevant municipal valuation date.

  5. If the property owner`s ID is unknown, a property can also be search as follow.

  6. Click on the "Advanced Property Search" text under the property search box on the Home page.

    • Next you have the option to search for properties using some combination of owner name, erf/portion/township, suburb and province. This is a trickier way to find properties since you need to get the spelling and combination of words right to find the right property. Less search information is better.

    • Assuming you enter a successful combination, you can then choose the property you want to value by selecting "View".

    • You will be asked to enter some information about the property - please complete this accurately as possible as it would be used if you choose to submit an objection to your value. Click on "Submit" to continue to the next step.

    • You will be presented with an estimate of your Property Value at the date of the current/upcoming valuation roll.

  7. The value estimate your received from ValueCheck does not match your municipal value. What do you do now? Click on Get Objection Motivation to purchase an Objection Motivation report. The website will guide you on what process to follow.

  8. What does the free valuation report show? The free valuation report shows the following:

    • Estimated value - this is the estimated market value at the time of the relevant municipalities latest valuation roll. It is determined by what is generally accepted as the leading statistical valuation model in South Africa. This is the value you should compare with the municipal value you have received from your municipality.

    • Expected high and low - this is the range within which there is a 75% probability that the market value of the property lies

    • Accuracy score - this is a measure of how confident we can predict the market value of the property. The higher the accuracy score (which ranges from 0 to 100) the more reliable the estimate is. An accuracy score over 70 is generally regarded as good although a score over 50 can be relied upon if it is supported with further evidence e.g. comparable sales data.

 

Can I get multiple free reports?

You are able to generate up to 10 free reports per day.

 

What is an Objection?

During the officially designated objection period, a person may object to any information on the Valuation Roll which they believe to be incorrect. It is up to the objector to provide support for their objection.

 

Should I submit an Objection?

ValueCheck does not provide advice on whether to submit an objection or not, but supply property and market information to assist in motivating a proposed change in the valuation roll. On average every R100,000 difference in value will result in between R80 and R100 extra property rates every month. Over 4 years that is R4800. If your property use category is also incorrect the R4800 could result in almost R20,000 extra rates over the 4 years.

 

How do I submit an Objection?

 

  1. It is important that an objection follows the process and timelines set out by the municipality.

  2. Use the current official objection form for the General Valuation Roll, don`t use an objection form meant for a supplementary roll or a previous general valuation roll.

  3. Ensure your objection form is correct and complete. (See the Help Page)

  4. Object during the prescribed period. The notice issued by the municipality informing property owners of the new general valuation roll will indicate the objection period. Or check the municipality`s website.

 

What do I need to submit an objection?

 

  1. Firstly, you need to compile evidence to support your objection. ValueCheck offers an Objection Motivation report you can use to support your objection. It is specifically designed the provide you the information you need to increase the chances of a successful objection.

  2. In order to obtain an Objection Motivation report, follow these steps.Return to your free property valuation report and select "Get Objection Motivation" Complete the fields required in the Property Questionnaire. It is important to complete these fields accurately to increase your chances of a successful objection.

  3. Below is a table which addresses some of the common questions that have arisen when completing the Questionnaire:

    Once you have completed all the fields on the questionnaire, you will be press "Submit" and you will be directed to a payment gateway where you will have a number of options to pay for your Objection Motivation.

    Once your payment has been processed, you will be able to download the ValueCheck Objection Motivation which will provide you the information you need to complete your object to your municipal property valuation.

    • Estimated Area under roof - if you don`t know this and don`t have your house`s building plans which should provide it, estimate it or measure and draw up the perimeter of your house taking large steps. It does not have to be 100% accurate but should be within the range of one of the options in the drop-down list.

    • Number of en-suite bathrooms - this is the number of bathrooms adjoining a specific bedroom in addition to the bathrooms recorded earlier in the questionnaire.

    • Number of garages - this is actually the number of cars that can be parked in enclosed garages.

    • Number of other parking bays - the actual number of covered parking places that are not fully enclosed like a garage.

    • Current municipal value - this the municipal valuation you received for this property the last time you were notified by your municipality during a General or Supplementary Valuation roll.

 

What risk do I run submitting an objection?

I`ve the information supplied in your objection form was done honestly and as accurately as possible you can expect one of the following outcomes:

  1. Correction of the General Valuation Roll information as requested in your objection.

  2. A correction that does not match you request, for example; your objection requested a reduction in market value of R100,000 and the municipal valuer reduced the value by R80,000.

  3. An increase in the municipal value to match the market value, although your request was to decrease the municipal value. You are however entitled to ask the municipal valuer how he came to his decision and still appeal his dicision.

  4. None of the information is amended and confirmed by the municipal valuer.

 

I have submitted an objection, what happens now?

 

The municipality should send you acknowledgment of receipt of your objection and is important to keep as evidence of your submission.

The objection will be reviewed by the appropriate person in the Municipality (e.g. the municipal valuer or assistant municipal valuer) and any necessary corrections or changes made. This could include a decrease or even an increase in your property value. This decision will be communicated to the objector in writing.

Should you disagree with the decision, the objector can appeal to an Independent Appeal Board. Information on how to appeal will be included in the objection decision notice.