We don’t think Joburg mayor Herman Mashaba realises how much damage is being done to the Democratic Alliance – and its hopes to continuing governing the most important city in the country – by the shocking property revaluations.
Shocking is a strong word to use … but there is evidence to justify it.
The city’s own figures show that just under one-third of the 900 000 properties which were assessed in the latest valuation exercise went up in value by between 41% and 60%.
Take a moment to absorb that. About 300 000 residential and commercial properties have supposedly increased in value out of all relation to either the cost of living or any improvement in property prices.
Mashaba’s pat answer is that many properties were undervalued at the last assessment, five years ago.
That many of them, Mr Mayor? We don’t think so.
The last five years have probably been the toughest, economically speaking, in recent history. The reality is that property prices have not risen even in line with inflation.
So, the picture of house prices is one of stagnation or decline and not a reason for partying.
Another issue is the looming one of land expropriation. What if that threatens to spill over into residential and commercial property?
What if people decide to hedge their assets and get rid of immovable ones? The property market could collapse – and would homeowners then be entitled to downwards revaluations and the accompanying reduction in rates charges?
Sadly, that’s not how any government works …
There is a serious problem here – not only for homeowners, but for the DA too, because the outrage at the valuations is coming from their voters.
And, come 2019, we believe the party will feel the pain as people abstain from voting in protest.
Words alone are not going to save you, Mr Mashaba.