South African households are bracing for the above-inflation increase in key municipal services as the new financial year begins on 1 July 2025. This includes increases in electricity, water, sanitation, refuse removal, and property rates.
Despite public objections and some last-minute revisions, most rate hikes have been passed, reflecting a growing strain on local municipalities struggling with ballooning costs, ageing infrastructure, and revenue shortfalls.
Here’s a breakdown of what’s changing — and what it means for you.
Municipal rates and service charges are rising sharply across South Africa’s major metros, driven by a combination of financial and operational pressures.
One of the primary factors is the rising input costs, with electricity tariffs approved by NERSA and bulk water prices from suppliers both seeing significant increases. At the same time, many cities are grappling with massive infrastructure backlogs. Johannesburg alone faces maintenance shortfalls exceeding R200 billion.
Adding to the strain are revenue shortfalls, as municipalities continue to struggle with low collection rates and an overreliance on national government transfers. In response, some metros have adopted redistributive strategies, aiming to shift more of the financial burden onto wealthier property owners to balance their budgets and fund essential services.
Here is a breakdown of the rate hikes tabled for the major cities:
| Rate | Johannesburg | Cape Town | Tshwane | eThekwini |
| Electricity | 12.7% | 7.2% | 10.2% | 12.7% |
| Water and Sanitation | 13.9% | 4.5% | 13.0% | 12.9% |
| Refuse removal | 6.6% | 7.4% | 4.6% | 7.0% |
| Property rates | 4.6% | 8.0% | - 4.0% | 6.5% |
Johannesburg faces a massive infrastructure maintenance backlog of over R200 billion, meaning residents are paying more, but may not see improved services immediately. Despite these increases, the city walked back earlier proposals for even higher property rates after community pushback.
While in Cape Town, rates are increasing below the national average, the city is adopting a progressive structure. This means the wealthier property owners, especially those with homes of R7 million, will bear a greater share of the cost.
Originally facing hikes of up to 15%, Durban revised its budget downward after community consultations. Nonetheless, the city still approved substantial increases to keep pace with infrastructure and service demands, especially after recent flood damage.
In Tshwane, property rates have been reduced by 4% to offset higher property valuations on the new municipal roll, and while this is rare relief for residents, a controversial flat-rate city cleaning charge of R194 per month for homes without a city waste account was recently launched.
While South Africa’s consumer price inflation has been trending around 4.4%, most municipal rate hikes far exceed this figure:
| Service | Average Hike Across Metros |
| Electricity | 10-13% |
| Water and sanitation | 10-14% |
| Refuse removal | 5-9% |
| Property rates | 4-8% (or more in some cases) |
This mismatch puts more pressure on already stretched household budgets, especially in middle- and lower-income brackets where municipal bills make up a larger share of total expenses.
For homeowners, the increase in property rates means higher monthly payments to municipalities, regardless of whether they own their homes outright or are still paying off a bond.
Tenants, meanwhile, will likely feel the effect through increased rent, as landlords pass on rising costs associated with utilities and levies.
If you are planning on buying a home in the near future, it is vital that you understand all the costs involved with owning a home and plan your financial future accordingly. Always leave room for rising interest rates, increases in rates and taxes, and starting an emergency fund for when something goes wrong.
As municipal rates and service charges increase, there are several steps residents can take to manage the impact.
Start by auditing your municipal bill to ensure there are no discrepancies, especially after tariff changes. Becoming energy and water-efficient can also help reduce overall costs, softening the blow of higher tariffs.
It's important to stay engaged in public consultations. By participating in budget meetings or speaking to your ward councillor, you can voice concerns and influence future decisions. Additionally, explore available rebates, as many municipalities offer rate relief for pensioners, low-income households, and people with disabilities.
South Africa’s municipalities are walking a tightrope, balancing their need for revenue with the affordability challenges faced by residents. This year’s increases are sharp, unavoidable, and often poorly received, especially where service delivery has already been poor.
However, residents and businesses have no choice but to adapt to this new landscape. It is therefore vital to adjust your own household budget, plan accordingly, and stay informed of any future developments that could influence your property and wallet.