Buying or selling a home is exciting. The paperwork? Slightly less so. So, before you start mentally arranging furniture or celebrating the sale, it's worth knowing who is expected to pay which costs in a typical South African property transfer. A little knowledge now can save a lot of head-scratching and nasty surprises later.
As a general rule, the buyer pays the costs associated with acquiring the property. These include transfer duty (where applicable), the conveyancing attorney's transfer fees, Deeds Office charges and other administrative costs involved in registering the property in the buyer's name. If you're financing the purchase with a home loan, you'll also need to budget for bond registration costs and your bank's initiation fees.
The seller, is generally responsible for the Estate agent's commission, bond cancellation costs (if there's an existing bond), and the various compliance certificates required , such as electrical, electric fence, gas, solar or beetle certificates where applicable, in addition, the seller must also ensure that municipal rates and taxes, water, electricity, refuse and sewerage charges are paid up to date. The conveyancing attorney obtains a Rates Clearance Certificate from the municipality, which is a legal requirement before the Deeds Office can register the transfer. Likewise, if the property forms part of a sectional title scheme or homeowners' association, body corporate or HOA levies must also be settled and a levy clearance certificate obtained.
Every property transaction is a little different, and costs can vary depending on the municipality, the bank and the terms of the sale agreement. The golden rule? Ask questions early, and understand exactly what you're responsible for before signing on the dotted line. Your future self (and bank account) will thank you.