Latest Cape Town court ruling signals relief for property sector
Any adjustments to future tariff structures will need to balance affordability while preserving the revenue base required to sustain ongoing infrastructure investment.
Justin Thom, director at Galetti Corporate Real Estate has welcomed the Western Cape High Court’s ruling against the City of Cape Town’s fixed tariff structure, adding that while it brings short-term uncertainty to municipal revenue planning, it also reinforces the strength of the City of Cape Town.
“The Court declared that the fixed charges linked to property values, such as cleaning, water and sanitation, were unlawful and that these must be removed by June 30 2026,” says Thom. “If upheld, this should bring some measure of relief to property owners, particularly as Cape Town is home to some of the continent’s most expensive property.”
Thom also commended the South African Property Owners’ Association (SAPOA) for its role in the matter, noting its importance in safeguarding the interests of property owners: “This highlights SAPOA as an industry body willing to step in where tariffs begin to resemble property-linked taxes rather than usage-based charges.”
He says Cape Town is undeniably one of the most functional municipalities in SA, responsible for providing consistent service delivery and infrastructure investment while focusing on development: “The City has been run like a business, and it works. This model has seen Cape Town maintain its status as a leading investment destination, so often reflected in global accolades showered on the City.”
However, he says attracting international investment, alongside increased semigration and short-term rental activity could risk making the region unaffordable for the South African buyer: “The City is considering its legal options and reviewing future tariff structures, and any adjustments will need to balance affordability while preserving the revenue base required to sustain ongoing infrastructure investment.”
Issued by Jess Gois
