City’s economy battered by property fiasco

PCB's Melanie Veness is working with Municipality to find a way forward in the rates crisis.

The city’s property market has ground to a halt causing delays and frustration to property buyers and sellers left in indefinite limbo by chaos in the municipality’s rate’s division.
Those caught up in the fiasco say the impact has been catastrophic with sales being cancelled, businesses unable to move into properties, and law firms and property agents left pulling their hair out in frustration.
Pietermaritzburg Chamber of Business CEO Melanie Veness says, apart from the chaos in the property sector, the crisis has had a detrimental impact on the city’s economy. She recently co-ordinated a meeting with senior officials and the mayor to resolve the matter.
“Challenges in the department have negatively impacted the whole sector, creating what can only be described as an economic crisis. For months now, various challenges in the department (from new financial systems and printers not operating, to staff not co-operating) have wreaked havoc, and at least there was acknowledgement of this in the meeting. I was pleased at the seniority of the representation, particularly that both the Chief Financial Officer and the Head of the Rates Department were present and that the officials chose to play open cards with us regarding the challenges in the department,’’ said Veness.
She said the backlog in the non-issuing of rates clearance certificates has caused numerous problems for conveyancers having to wait up to 16 weeks to obtain an assessment of rates and two to three weeks for certificates to be issued once payment has been made.”
“Further delays are experienced after conveyancers are notified of additional costs due to original assessments being inaccurate. Other frustrations encountered include the time it takes to close a seller’s account, refund them the amounts due and get a new rates account for the new owners,” Veness added.
The city has now instituted a forensic investigation to probe allegations of corruption in the Rates Department. Three staff members from the department face suspension and the municipality has set aside R300 000 to investigate the goings on in the department.
On Monday, Mayor Themba Njilo apologised to stakeholders from the property sector for the major setbacks they suffered.
Bruce Campbell of Natal Properties said the sector was running out of patience and was tired of broken promises by the city to fix the mess.
“Over the past few months, there has been deterioration in the amount of time it takes to receive a rates clearance. Both the parties which include the person selling and the one buying are affected as the person who sells is awaiting funds for another property that they possibly want to buy. The municipality has made numerous promises which they have not kept with regards to solving the problem. At the meeting, we were told that something is being done by the municipality but we have yet to see that. We have also asked if there is anything we can do as property consultants to help speed up the process which will help us solve the issue of delayed rates transfers. In other cities like Durban and Cape Town, the maximum amount of time it takes for the transfer is two weeks,” said Campbell.
Kevin Ramdeyal of Maritzburg Properties said the delays were causing stress on all parties.
“In order for a property to be transferred, the rates must be sorted and unfortunately without the rates in place the process is severely hampered. The delay inconveniences both parties, and the buyer is faced with the additional burden of finding alternate accommodation or facing an unusually long wait to access the property they have purchased. The process becomes stressful on all parties involved,’’ Ramdeyal added.

  AUTHOR
Keroshini Paltu

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