The buyer and seller involved in a property transfer is each responsible for certain costs related to the process and it’s important for each party to have a clear understanding of what they are liable for from the outset. To make this simple, we’ve outlined the common costs related to a property transfer and identified who is responsible for each.
What costs is the purchaser responsible for?
- Conveyancer Fees: The value is determined by the Legal Practice Council’s conveyancing fee tariff guideline
- Administration Fee: This will cover issuing the City Council clearance certificate
- Bond Registration Fees: If a bond is being taken to finance the property, there will be a cost in registering this with the bank. In addition, you can make use of bond cost calculator to help work out the monthly cost of your repayments.
- Deeds Office Fees: This will cover the process of lodging your transfer at the relevant Deeds Office, and the value will be determined by the value of the property.
- Postage and Petties: Typically an amount between R600-R1000, this is a fee to cover necessary postage and small expenses incurred in the processing of transfer documents
- Certificate: From the homeowners association and/or body corporate for levies
- Transfer Duty: If the property value is above R900 000, transfer duty must be paid to the Receiver of Revenue, alternatively if the property is below that price, the purchaser will be liable for the cost of obtaining the transfer duty exemption certificate from SARS
- Occupational Rent: If the purchaser moves into the property prior to the registration as agreed by the seller, the purchaser will have to pay occupational rent
- Disbursements: This will cover the costs of Deeds Office searches, CIPC searches and FICA verification
What costs is the seller responsible for?
- Rates and Taxes: 3-4 months’ worth of these costs, as prescribed by the municipality concerned, payable to the municipality
- Levies: Payable to the homeowners association and/or body corporate
- Agent Commission: A percentage of the sale price as agreed with the estate agent, and subject to 15% VAT
- Cancellation Costs: If there is a bond over the property, there will be costs associated with cancelling this
- Compliance Certificates: Costs due in obtaining electrical, gas installations and electric fence certificates (wherever applicable) and water certificate (Cape Town Municipality only) and borer beetle certificates (coastal regions only)
Written by Wessel de Kock