How will e-toll affect the market?

There has been much controversy regarding the South African National Roads Agency (SANRAL) e-tolling system that is officially planned to launch in Gauteng within the next few weeks. 

Initially planned to be implemented early in 2011, the decision was made to postpone the R20 billion project until further notice. “This came as a relief to many consumers living in and around the region, even if it’s only on a temporary basis,” says Adrian Goslett, CEO of RE/MAX of Southern Africa, “as it would add even more pressure to their already stretched budgets from the increased cost of living.” 

Essentially the system consists of 49 electronically operated toll gantries that are spread across 185km of existing national roads on sections of the N1, N3, N12 and R21 freeways in greater Johannesburg and main links between Johannesburg and Pretoria. Tolls are automatically charged without vehicles stopping via an electronic tag or e-tag and deducted from the owners’ linked pre-paid account.  The electronic system is to be used so that the flow of traffic is not affected in anyway. SANRAL decided that building many toll points as opposed to only a few means that commuters would only pay for the section of road that they used. The collection from these toll points will be used to fund a six-phase project known as the Gauteng Freeway Improvement Project.

“We could see many homeowners or tenants in the rental market moving closer to their place of business. As many consumers commute from the Johannesburg area to Pretoria and vice versa, it is likely that these commuters would want to avoid the rising cost of travelling that has already been affected by fuel price hikes,” says Goslett. “Aside from the rental market, it will also have an impact on property buying decisions in the Gauteng region with buyers opting to purchase property as close to where they work as possible, with commuting already a consideration for many buyers.”

He notes that the system could also bring about other trends among consumers such as an increased number of the public car-pooling or using alternate modes of transport such as the Gautrain. Property within proximity to Gautrain stations has already seen significant growth and the implementation of the E-toll could further impact on these areas.

The e-tolling system will also have a significant cost implication to consumers that commute along the national freeways regularly. It could also impact other service costs in Gauteng as well as inflate consumer prices for food and other commodities. Large retailers and supermarkets that rely on the national road network for delivery will be affected by an approximate 11% increase in transport costs and will in turn be forced to pass that onto the consumers by increasing their prices. This will mean that households in the Gauteng region will pay more for goods and services, which will impact on potential home buyers and their ability to save for a deposit for their new home or show positive affordability ratios.

“Most services will be affected by the system, which in turn will impact homeowners and consumers in some way. Furniture removal operators, for example, are charged on a volumetric basis rather than per axle, which means that, on average, some of these operators can expect to pay around R75 000 per month. This cost will need to be made up somehow, which means it will be transferred to homeowners who want to move house,” says Goslett, “Municipal authorities should also be aware of the fact that if their area has few alternative access routes, the tolling of major access routes could make their municipality less attractive as a location for residential and commercial activity.”

The tolling tariffs and discount structures for the system were released to the public on 6 February 2011. A driver of a light vehicle - the predominant category of most road users - who has an e-tag can expect to pay approximately 47c/km, while those without an e-tag will pay 33% more. This means that a return trip from Rivonia in Sandton to Hatfield in Pretoria will cost R45.42 for registered e-tag users and R60.58 for a driver who has not registered. There are discounts of up to 45% for drivers who use the routes on a frequent basis making the absorption of the cost more manageable. There are also various discount structures for commuters travelling during off-peak times. 

“Homeowners in the Gauteng region will need to investigate the likely impact that e-tolling could have on their financial situation so that they can engage in proactively identifying ways to lessen the negative effects.  Pre-emptive planning will go a long way in finding cost-effective solutions once the system is implemented,” Goslett concludes.

  Comment on this Article

  Please login to post comments

Post to my facebook wall
Characters remaining

    Latest Property News
    • 24 Nov 2017
      Demand for secure estate living in Hout Bay has risen sharply in recent years, precipitating a spike in development with estate homes now accounting for 20.24% of the property landscape with the launch of an exclusive new gated development on 26 November adding 20 more units to the existing 1250 estate homes.
    • 24 Nov 2017
      There are some things that money can’t buy – spectacular views from Mouille Point to the V&A Waterfront and a trendy and lively neighbourhood that encapsulates the very best of the Cape Town lifestyle.
    • 24 Nov 2017
      Tshwane’s four-bedroom Mayoral mansion, nestled among ambassadorial residences in the upmarket suburb of Muckleneuk, fetched R5.1 million after spirited bidding at High Street Auctions’ final sale of the year.
    • 23 Nov 2017
      Reserve Bank Governor, Lesetja Kganyago, said that the Monetary Policy Committee had once again decided to let the interest rates remain unchanged with the repo rate at 6.75%, and the prime lending rate at 10.25%.
    • 23 Nov 2017
      As the holiday season approaches, most of us are counting the days until that year-end bonus hits our account. There’s nothing quite like a little bank balance booster to get us in the holiday spirit.
    • 23 Nov 2017
      The Adelphi Centre (now entitled “ARTEM") in Sea Point, Cape Town, is being extensively renovated, and once complete will offer an ultra-luxurious galleria style shopping centre unlike any other seen on the Atlantic Seaboard or in Cape Town.
    • 23 Nov 2017
      If you are looking to sell your home in today’s real estate market, there are certain things that you need to include both inside and outside your house. Today’s generation of home buyers is looking toward a more eco-friendly, energy and water conscious home, and if your house stands out then you are more likely to be able to sell it.
    • 22 Nov 2017
      Most people know of the Community Schemes Ombud Service (CSOS) and that levies must to paid to fund its operations. In this article the experts at Paddocks will address some of the issues that are causing confusion.
    Subscribe to the MyProperty Newsletter

    Last Name  
    Email Address  
    Email Frequency
    Share this Page

    For Sale Property
    Rental Property
    More Options
    Connect with us