1. What is a conveyancer?
A conveyancer is an admitted and practicing attorney, who has passed the requisite admission exams and who has been admitted as such by the High Court of South Africa. Not every attorney is a conveyancer, but every conveyancer is an attorney.
Ownership of all immovable property in South Africa (e.g. land, farms, standalone houses, sectional title units) is recorded in the Deeds Registry by the Deeds Office. The transfer of any immovable property from one owner to the next owner, can only be facilitated by a conveyancer. It is a process that cannot be undertaken by any person except a duly registered and admitted conveyancing attorney.
Generally, it is the seller or current owner of the property that gets to choose which conveyancer is appointed to do the transfer.
The conveyancer is responsible for ensuring that the person selling the property is indeed the owner of the property. The conveyancer is also the central point for the control of the flow of funds relating to the transfer process. It is a position of immense responsibility.
2. How long does a property transfer take to complete?
On average, it takes about 3 months for a property to be registered, in the name of the purchaser, from the date that the purchaser has secured the full purchase price. Ordinarily, the process does not commence until the funds are secured (either by way of a cash deposit, finance approval from the bank or a bank guarantee) to avoid any party incurring wasted costs. It is impossible to guarantee a date of registration as there are many variables, particular to each matter and which cannot always be predicted. Our offices, however, provide regular updates and keep all parties informed every step of the way to enable informed decision making. We are always available to answer queries.
3. What conveyancing costs must sellers pay?
3.1. If an estate agent is involved in brokering a property sale, ordinarily the seller is liable for the agent’s commission, which the conveyancer will deduct from the sale proceeds and pay to the agent directly on registration.
3.2. If the seller has an existing mortgage bond registered over the property, the seller is liable for the conveyancing costs incurred in having that existing bond cancelled on the date of registration. The property cannot be transferred to the purchaser subject to any existing bonds and those bonds must be cancelled as part of the transfer process.
3.3. Before a property can be transferred, the local municipality with jurisdiction over that property, must provide its consent to the transfer. That consent will only be issued, if there are no amounts owing to the municipality by the seller (or its tenant, if applicable). In addition, in order to provide consent, the municipality will ask for a further advance security deposit, usually a further 4 months in advance, as security for amounts to be incurred during the transfer process. The seller is liable to make payment of the amount stipulated by the municipality, to provide its consent to the transfer.
3.4. If the property is part of a homeowners association or is a sectional title unit, a similar consent is required from the managing agent or body corporate and similar amounts would need to be paid;
3.5. A seller might also be required by a purchaser to provide approved plans for the property;
3.6. The seller is required to ensure that all of the electrical installations, appliances and systems of the property are compliant with legislation and to ensure that a certificate of compliance is issued by a duly registered electrician. The seller must do the same for any gas installations, appliances and systems as well as for any electric fence installed on the property. If the property is at the coast, a similar certificate is required to confirm there are no wood boring insects present in the property. The Western Cape also requires a certificate of compliance in respect of the property’s plumbing systems.
3.7. This is not an exhaustive list and there may well be other costs involved (for example the cost of procuring the Masters Office consent if the seller is a deceased estate or the cost of procuring a new original title deed, if the seller has misplaced the original etc)
4. What conveyancing costs must purchasers pay?
4.1. The purchaser is liable to pay for the conveyancer’s costs of the transfer process. The costs are calculated in accordance with a tariff suggested by the Law Society of South Africa and which is based on the market value / purchase price of the property. There are also certain disbursements payable, for example, Deeds Office fees.
4.2. The purchaser is also liable for the transfer duty payable to SARS. This too is calculated on a sliding scale, according to the market value / purchase price of the property.
4.3. If the purchaser is financing the purchase by way of a loan from a bank, the purchaser is also liable for the fees of the conveyancer appointed by the bank to attend to the registration of the mortgage bond. Those fees too are calculated in accordance with a tariff suggested by the Law Society of South Africa and which is based on the market value / purchase price of the property.
4.4. If the property is bought on an auction, the purchaser is generally liable for the auctioneer’s commission and the seller would not pay commission to an estate agent.
4.5. This is not an exhaustive list and as the purchaser is liable for the costs of the transfer process, occasionally there might be other fees and charges, for which the purchaser is liable. The transfer costs and the transfer duty are reviewed annually.