While buying a property in South Africa may seem daunting, it can be a rewarding investment. Making use of reputable advisors can turn this into a smooth process even for first-time buyers.
It is important to know that finding the right property for your needs is only the first step in this process and that the legal transfer can sometimes take longer than expected. Because each and every property transfer is unique they will have different times of completion.
This can range anything from 6 weeks to 6 months depending on various external factors. Here we will discuss what exactly a property transfer is and what you can expect in terms of timeline. The process of purchasing and selling either commercial or private property is similar.
What is a property transfer?
The legal word used for the transfer of immovable property from one owner to another is called conveyancing or a property transfer.
The transfer of property is when ownership of property is moved from one person to another. This happens when a property is sold or when the owner of the property has passed away.
Understanding the conveyancing sequence, and having all the necessary documentation ready at the outset, will ensure a smooth transfer.
The Property Transfer Process:
The first step when transferring property is the signing of the sale agreement. Once this has happened the buyer needs to obtain a home loan. If you are a first-time buyer it’s best to use the services of an expert bond originator who will help you obtain the best home loan deal available.
Once your home loan has been secured, you can move on to step 2. Here you appoint a transferring attorney, also known as a Conveyancer Attorney. They will obtain FICA (ID and proof of residence) of both the buyer and seller. When this is done, your Conveyancer Attorney will apply for the seller’s bond cancellation figures. This is when the bank sends the original Title Deed to the bond cancellation attorneys.
After the preparation is done by the transferring attorney, the buyer and seller have to sign the transfer documents. The transferring attorney then requests figures from the municipality to ensure that all the seller’s rates and taxes are paid up to date before lodging a clearance certificate issued by the municipality.
After this, the buyer must pay the South African Revenue Services (SARS) transfer duty. These transfer duties are a tax levied on the value of any property acquired. They are also statutory and cannot be negotiated. A transfer duty receipt will be requested by your transferring attorney on SARS e-filing and also make the payment of the transfer duty on behalf of the buyer. This process can take anything from 5-10 working days to be completed.
The last step in the property transferring process is when the transferring attorney lodges all the required documents with the necessary authorities. This is done together with the new bond registration and the old bond cancellation. It can take anything from 8-10 working days for the paperwork to be examined. Once this has been done, the buyer is now the rightful owner of the property.
Because each property transfer is unique, there is no exact timeline. It depends on the co-operation of the parties and their contractual arrangements. Most of the process, which your Conveyancer Attorney has to coordinate, is actually out of their hands. They depend on banks, city councils and revenue offices to perform their duties.
The overall time frame for a property transfer is, on average, 3 months from the date of sale until the property is registered in the new owner’s name.
There are a couple of steps when transferring property:
- The signing of the sale agreement.
- Obtain a home loan.
- Appoint a Conveyancer Attorney who will obtain FICA for both parties, as well as apply for the seller’s bond cancellation figures.
- After the preparation is done by the transferring attorney, the purchaser and seller have to sign the transfer documents.
- The buyer must pay the South African Revenue Services (SARS) transfer duty.
- The transferring attorney lodges all the required documents. Once this has been done, the buyer is now the rightful owner of the property.
By appointing a trusted Conveyancer Attorney and team, buying a property could be a painless process.