Metropolitan councils resort to selling properties to recoup unpaid rates

Eighteen metropolitan councils are owed more than $9m in unpaid rates, with one eastern suburbs resident in debt by more than $38,000. Here’s how councils are combating the problem.

Under the Local Government Acts, councils can sell homes with rates in arrears of three years or more. Picture: iStock

Metropolitan councils have sold 15 properties to recoup outstanding ratepayer debts, with one eastern suburbs resident owing more than $38,000 in unpaid rates.

The Norwood, Payneham and St Peters resident has a $38,425 debt from the past 13 years – the highest amount owed to a city council surveyed by The Advertiser.

The longest running debt of 35 years belonged to a Mitcham ratepayer, who owes $35,783.

The Advertiser survey of 18 metropolitan councils reveals they are owed more than $9m in unpaid rates from the past three years.

Under the Local Government Act, councils can sell a property after the rates have been in arrears for more than three years.

Playford Council has sold eight properties – “mostly vacant land, derelict houses or deceased estates” – over the past five years.

A council spokeswoman said the sales were a “last resort” after ratepayers were offered direct debit, payment arrangements and referrals to free and accredited financial counsellors.

“Our early intervention strategy ensures ratepayers receive assistance earlier and we work with them to find a solution to pay off their debt and retain their properties should they want to,” she said.

Tea Tree Gully Council said 106 properties had proceeded to the sale of land process, but only two were sold after additional hardship options were agreed to by ratepayers.

Onkaparinga Council – the largest metropolitan council – is owed $4.8m in unpaid rates, but a spokesman said while it seemed “high” its rates revenue was $143m a year.

Mitcham and Tea Tree Gully councils were owed $874,318 and $688,655, respectively.

More than 3100 ratepayers are on payment plans, including 666 residents in Tea Tree Gully and 307 people in Port Adelaide Enfield.

Port Adelaide Enfield Mayor Claire Boan said councils being the closest level of government to the community understood some people faced financial difficulties.

Port Adelaide Enfield Mayor Claire Boan. Picture: Naomi Jellicoe

“Councils are always open for discussion regarding financial matters, so if you are facing financial difficult I strongly encourage you to reach out to your council and discuss what options are available to you,” Ms Boan said.

Adelaide Hills Council’s finance team leader Liz Packer said its 18 payment plans were being used by people who had lost their jobs, have health issues, in bushfire recovery, or after relationship breakdowns.

“It’s not just about how high rates are. The intent for anyone on a payment plan is for it to be a temporary measure that will right itself in due course,” Ms Packer said.

SACOSS chief executive Ross Womersley said ratepayers experiencing hardship may struggle to cover the basics given living cost increases.

“I also note that in the last few years home values have escalated far faster than the incomes of most pensioner homeowners and as a result the rate income for most local governments will be increasing significantly,” Mr Womersley said.

“Some of these resources should be used to help people in genuine hardship.”

Charles Sturt, Campbelltown and Salisbury councils did not respond to inquiries.

Originally published as Metropolitan councils resort to selling properties to recoup unpaid rates