eThekwini has emerged as the costliest metro for business in the country, resulting in significant property development losses to Cape Town, Johannesburg, and Pretoria.
According to the SA Property Owners' Association (SAPOA), the high rates in eThekwini are driving this trend, it said in a discussion with News24.
Bernadette Mzobe, the regional chairperson of SAPOA, revealed that eThekwini lost approximately R7 billion in property development investments last year as developers opted for more affordable cities.
She also expressed concern that the city's current approach to student accommodation rates could result in a further loss of R1.5 billion, despite a high demand for such facilities due to the presence of three universities in the area.
This issue has become a pressing concern for eThekwini, as the metro recently approved its 2024/25 budget, including revised tariff increases for utilities and property rates.
Mayor Mxolisi Kaunda announced adjustments: water and sanitation tariffs were reduced to 10.9%, electricity to 12.72%, property rates to 6.5%, and refuse tariffs to 7% for households and 8% for businesses.
However, these changes were met with opposition, who argue that tariffs should align with the current inflation rate of 5.3%.
Mzobe stated that eThekwini is five times more expensive for businesses compared to other cities. Additionally, the city's slow plan approval process, which can take up to nine months, further hampers development.
In contrast, cities like Cape Town approve plans within 30 days, allowing for quicker and more cost-effective project initiation.
eThekwini speaker Thabani Nyawose acknowledged the metro's high costs and the slow plan approval process. He admitted that corruption is a contributing factor, with efforts underway to investigate and address these issues.
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