Cape Town’s new municipal valuation roll has been unveiled. A quick FM snapshot suggests most homeowners have seen values rise 10%-25%, aligning with the 17% average increase indicated by the City of Cape Town last week. This is fair enough, given that the new valuations capture the increase in property prices for the three years to July 1 2025.
Still, the FM believes several homeowners in sought-after coastal suburbs — including Noordhoek, Kommetjie, Camps Bay and Clifton — have been hit with markedly steeper valuation spikes.
That’s not to say these increases aren’t justified. It’s no secret that in recent years demand from international buyers and semigrants has pushed house prices in the city’s desirable neighbourhoods ever higher.
So some homeowners, particularly those in wealthier suburbs, will be saddled with disproportionately large increases when new monthly rates bills kick in on July 1. One resident in our snapshot, for example, has seen his property’s value rise by 45% from R4.4m to R6.35m. That will translate into a 23% (R577) rise in his monthly rates from July 1 — from R2,556 to R3,133.
That’s despite the 10.2% cut in the rate-in-rand tariff, proposed last week by the city, to offer homeowners a reprieve against steep valuation increases. The council plans to lower the tariff to 0.006428 (0.64c in the rand), down from 0.007159, if the 2026/2027 draft budget is approved in May.
It’s not an unprecedented move. Rate-in-rand, the formula used to calculate property rates, was also dropped in 2023 and 2018 when previous valuation rolls were released. Back then, the tariff was cut 3%-4%. This year’s generous 10.2% proposed drop was no doubt spurred by looming local government elections and will mean that the 2026/2027 tariff will be nearly 7% lower than the rate-in-rand tariff used to tax residential properties 10 years ago.
Homeowners’ rebates will also be increased, from R450,000 to R500,000 on properties valued up to R8m (from R7m now). The city claims the new measures will ensure that 60% of all residential properties will either get a rates decrease or no change in rates — despite rising values.
About 90% of properties under R3m will apparently see rates increase by less than R100 a month. Properties valued at R3m-R6m will get a median increase of R27-R200, while those in the R6m-R10m bracket will rise by a median R250-R300.
It’s true that Cape Town tariffs are significantly lower than those of other major metros. Moreover, Cape Town homeowners are generally getting way more bang for their buck in terms of municipal infrastructure and service delivery than most of their counterparts in other big metros. Long-suffering Joburg ratepayers, for example, pay 34% more at 0.009544 rate-in-rand and get a smaller rebate, of only R300,000. Tshwane, Ekurhuleni and eThekwini tariffs are even higher.
So one could argue that Cape Town residents should be less inclined to complain about rates bill increases. But that doesn’t address affordability. After all, higher property valuations don’t necessarily match homeowners’ concurrent increases in disposable income.
Also, industry players say it’s too early to determine if there are inflated valuations or systemic errors across the metro; the city’s computer-assisted appraisal system has overvalued properties in the past. An inflated valuation can, of course, cost homeowners thousands more over the three-year cycle to June 30 2029.
Cape Town ratepayers have until April 30 to check valuations and object if necessary.
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