Call for Minister to Sort out Joburg Mess

Billions of Rands tied up in property sales crisis 

” Property transactions worth billions of Rands are being held up by the City of Joburg, which is taking months to issue clearance certificates to owners and developers.  

This is grinding the property industry to a halt, says the Johannesburg Attorneys Association (JAA), and it hasn’t excluded the possibility of taking legal action against the Council. It is estimated there are 40 000 property sales being held up, involving R5 billion.  

The Council has not responded to a request for comment. According to property developers, the problem started a few months ago when the Council moved to a new IT-system, called SAP. Since then, individuals and developers have been waiting for up to 7 months to get clearance certificates.  

Anton Theron, acting chairman of the JAA’s property committee, said the association had been inundated with reports from its members regarding their problems. ” The JAA have been in discussion with officials in the rates department for many months, but nothing gets resolved. Our members are being reported to the Law Society by their clients for lack of performance because they cannot obtain rates clearance and are therefore unable to lodge transactions for registration.  

” Our members, unfortunately, do not have any control over the processes within the Council and cannot perform their duties without the relevant clearance, ” he said.  

The association also could not get information from the Council. Recently it asked its members to submit their complaints. ” We realised the problem is serious. We got 400 complaints, ” said Theron.  

The Star spoke to several developers and attorneys, none of whom wanted to be named. One attorney said that if her name was mentioned, the Council would boycott all her applications. The problem was ” bigger than we could even imagine”.  

” We were advised that staff are only going to start training on the new system shortly. I think it is going to take a very long time to get the system running smoothly. Unless the Council works 24 hours a day, I do not think we are going to see a vast improvement in a hurry. Our clients are extremely angry, and blame us. In many cases, people are being forced to sell their homes because of financial difficulties. They cannot afford to carry the costs. ”  

The problem was ” too huge ” to be resolved at local government level, but should be escalated to the minister of local government as this was a political matter.  

Jonny Novick, managing director of Vered Estates, said the processing issue had already had a negative short-term effect on the Gauteng property market and needed to be addressed immediately.  

” Some of our clients who sold their homes last year are still awaiting clearance figures so they can obtain a rates clearance certificate. ”  

This article was written by Anna Cox, shared by Randburg branch and was originally published in the Star Newspaper on Monday, 24 May 2010.

Chas Everitt Randburg Office
Tel: 011 801 2500
Website: http://www.everitt-randburg.co.za

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