Cape Town is facing a wave of backlash from residents following the City's proposed property rates and tariff increases for the 2025/26 financial year. With rate hikes of up to 20% on the cards, concerns are mounting about the impact on homeowners, retirees, and the broader property market. Here's a breakdown of what's being proposed, who will be affected, and how residents can respond before the final budget is approved in June 2025.
According to the City of Cape Town's draft budget, the key proposals include:
Property Rate Increase: An average hike of 7.96% across all property categories. However, owners of high-value properties could see increases exceeding 20%.
Changes to the municipal valuation roll, which will see property values reassessed at market rates.
A new tariff structure introducing fixed charges for water, sanitation, and a city-wide cleaning levy. Currently, fixed charges for water and electricity connections are uniform across all households. Under the new model, these will be linked to a property's municipal valuation—meaning the higher your property value, the more you pay.
Revised electricity tariffs and changes to the lifeline tariff eligibility threshold.
Homeowners in middle- to high-income areas are likely to feel the brunt of these changes. Some property owners, particularly retirees living in fully paid-off homes, could see increases of 25% to 35% in their monthly municipal bills. This is due to the combination of higher property valuations and value-based fixed service charges.
For example, residents in areas like Oranjezicht and the Atlantic Seaboard, where property values have soared, are expected to experience significant increases in their monthly rates bills.
As reported by BusinessTech and Moneyweb, properties valued between R1 million and R1.5 million may even see a decrease in monthly rates, offering some relief to this segment.
It’s important to note that Cape Town operates on a progressive rating system – the more your property is worth, the more you pay. This system is designed to be redistributive, helping to subsidise service delivery in lower-income areas. While it places a heavier burden on the wealthy, it helps shield poorer households from rate shocks.
While much of the backlash has come from residents in affluent areas, the changes are expected to affect a broad cross-section of property owners. Critics argue that the steep increases may inadvertently place pressure on middle-income households and retirees. There's also concern that escalating rates could dampen property investment and drive gentrification.
However, supporters point out that a progressive rate structure is essential for equity. Wealthier homeowners benefit from well-maintained infrastructure and services, and the increased revenue can help subsidise critical services for poorer communities.
Cape Town is not alone in revising rates. Municipalities across South Africa are under pressure to boost revenue in the face of inflation and declining national transfers. However, Cape Town’s proposed hikes are among the most substantial, prompting a louder-than-usual public response.
If you're concerned about how these changes will impact you, you have until 2 May 2025 to submit your feedback. Here's how:
Submit comments online at www.capetown.gov.za/HaveYourSay
Email: budget.comments@capetown.gov.za
Deliver written comments at Subcouncil offices (a full list is here)
If you’re unable to write, staff at Subcouncil offices will assist you.
Call 0800 212 176 for verbal feedback
You can also access the full budget documents here and use the rates and tariffs calculator to estimate how much more you might be paying.
Whether you see this as a necessary adjustment for a growing city or an unjust burden on homeowners, now is the time to speak up. With the budget still open for public input, residents have a real chance to shape the outcome.