Conveyancing and Property Transfers

 

 

 

No, it is a legal requirement in South Africa to use a conveyancer for property transfers.

There are several costs, including:

  • Transfer duty: A tax paid to SARS by the buyer, calculated based on the property's value.   
  • Conveyancing fees: Fees for the conveyancer's services.   
  • Bond registration costs: If the buyer is taking out a mortgage.
  • Rates clearance certificate: Fees to obtain this from the municipality.
  • Compliance certificates: Costs for electrical, gas, and other necessary certificates.
     

The conveyancer lodges all the transfer documents at the Deeds Office. Examiners check the documents for compliance, and if everything is in order, the transfer is registered, and the buyer becomes the legal owner

This certificate from the local municipality confirms that all rates and taxes on the property have been paid up to date. It's required for the transfer to proceed. 

This is a legally binding document signed by the buyer and seller, outlining the terms and conditions of the sale, including the purchase price, payment terms, and any conditions (e.g., obtaining a bond).
 

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Property Transfer in South Africa

Congratulations on taking the exciting step of purchasing property in South Africa! Whether you're realizing a dream of homeownership or expanding your investment portfolio, buying property is a significant achievement.  However, the journey to holding the keys involves a crucial phase: property transfer.  Navigating this legal process can seem daunting, with its many steps and requirements.  But with the right guidance, it can be a seamless and even enjoyable experience.  Aucamp Attorneys is here to demystify the property transfer process and ensure your journey to ownership is smooth, secure, and legally sound, from offer to registration.

What Property Transfer means 

In South Africa, property transfer (also often called property conveyance) is the legal process of changing ownership of immovable property from one person or entity to another.  Essentially, it's the formal procedure that ensures the legal title of a property is officially and correctly passed from the seller to the buyer. This process is governed by specific laws and procedures to safeguard the rights of both parties and ensure a legally sound and valid transfer of ownership.  Aucamp Attorneys expertly guides clients through every step of this process, ensuring a smooth and legally compliant property transfer.

Property Transfer in South Africa: A Step-by-Step Guide 

Buying or selling property is a significant milestone.  At AUCAMP Attorneys, we understand the complexities of the property transfer process and are here to guide you every step of the way. This comprehensive guide outlines the key stages involved in a property transfer in South Africa:

1. The Offer to Purchase (OTP): Setting the Foundation

The journey begins with the signing of the Offer to Purchase (OTP). This legally binding document outlines the agreed-upon terms and conditions between the buyer and seller, including the purchase price, payment terms, and any conditions precedent (e.g., securing a mortgage bond).  A clear and comprehensive OTP is crucial to avoid future disputes.  AUCAMP Attorneys can assist in reviewing and understanding the OTP before signing.

2. Appointing a Conveyancer: Navigating the Legal Landscape

Once the OTP is signed, a conveyancer, a specialized attorney handling the legal aspects of the transfer, must be appointed.  While typically the seller's responsibility to appoint, the buyer usually bears the costs. The conveyancer plays a vital role in ensuring all legal requirements are met and the transfer is registered with the Deeds Office.

AUCAMP Attorneys' Conveyancing Services Include:

  • Drafting and preparing all necessary legal documents, including the transfer deed.
  • Conducting a thorough title deed search to verify ownership and identify any encumbrances.
  • Liaising with financial institutions to facilitate payments.
  • Calculating transfer costs, including transfer duty and conveyancing fees.
  • Registering the transfer of ownership at the Deeds Office.
3. Title Deed Search: Ensuring Clear Ownership

The conveyancer conducts a title deed search to confirm the seller's rightful ownership and identify any outstanding debts, liens, or restrictions that could hinder the transfer.  Any issues uncovered must be resolved before the transfer can proceed.

4. Payment of Transfer Costs: Understanding the Financial Implications

The buyer is responsible for paying transfer costs, which include:

  • Transfer Duty - A tax payable to the South African Revenue Service (SARS) based on the property's purchase price. Exemptions apply below certain thresholds.
  • Conveyancing Fees - Fees charged by the conveyancer for their services, typically calculated based on the property value.
  • Other Expenses - May include costs for clearance certificates and other related expenses.

AUCAMP Attorneys will provide a detailed breakdown of these costs.

5. Bond Registration: Securing Financing (If Applicable)

If the buyer requires financing, a mortgage bond must be registered.  A bond attorney, working in conjunction with the conveyancer, handles this process. The bond is registered simultaneously with the transfer of ownership.

6. Obtaining Clearance Certificates: Ensuring Compliance

The conveyancer obtains necessary clearance certificates to confirm no outstanding municipal rates, taxes, or levies exist on the property. These include:

  • Rates Clearance Certificate From the local municipality.
  • Levy Clearance Certificate From the body corporate or homeowners’ association (if applicable).
  • Electrical Compliance Certificate (ECC), Gas Compliance Certificate (GCC) and Electrical Fence Compliance Certificate (EFCC) The seller is responsible for these.

These certificates are essential for Deeds Office registration.

7. Lodging Documents at the Deeds Office: The Final Step

Once all documents and certificates are in order, the conveyancer lodges them at the Deeds Office for registration. The Deeds Office reviews the documents for compliance. Upon approval, the transfer is registered, officially transferring ownership to the buyer.

8. Transfer of Ownership: A New Beginning

After registration, ownership officially passes to the buyer. The conveyancer informs both parties, the seller receives the proceeds, and the buyer takes possession.

Different Types of Property Transfer that can occur 

Type of Property Transfer Description
Transfer Arising from Inheritance Transfer of property from a deceased person to their heirs. This is carried out by the representative or executor of the deceased estate, either according to a valid will or the laws of intestate succession (when there is no will).
Transfer Arising from Divorce Transfer of property as dictated by a divorce order. Property may be transferred to one or both of the divorcing partners as part of the divorce settlement.
Transfer Arising from Donation Transfer of property given as a gift from one person (donor) to another (donee). This transfer requires written acceptance of the donation by the donee to be legally valid.
Transfer Arising from Prescription Transfer of ownership mandated by a court order. Granted when a person has occupied or possessed property adversely (as if they owned it) for an uninterrupted period of 30 years, even without the registered owner's consent.
Transfer Arising from Sale Transfer of ownership based on a sale agreement between a buyer and seller. The sale can be through a private treaty (private sale) or a public auction.
Transfer by Virtue of Marriage in Community of Property Automatic transfer of an undivided half share of each spouse's property to the other upon entering into a marriage in community of property. This occurs by law without needing a separate deed of transfer.
Transfer Arising from Exchange Transfer of land ownership where two or more parties mutually exchange ownership of different properties.
Transfer in an Insolvent Estate Transfer of property belonging to a person declared insolvent (liabilities exceed assets). By law, ownership transfers to a trustee who manages the insolvent estate. This transfer happens automatically without a specific deed of transfer.
Transfer Arising from Rectification Transfer of property back to the rightful owner after it was incorrectly registered in another person's name due to an error. This is to correct a mistake in the Deeds Registry.
Transfer Arising from Restoration of Property to a Rehabilitated Insolvent Transfer of property back to a person who has been rehabilitated from insolvency. Rehabilitation legally clears a person from insolvent status, and this transfer restores their ownership rights to previously insolvent estate assets.
Transfer Arising from Dissolution of a Partnership Transfer of property owned by a partnership that is being dissolved. The property is transferred to some or all of the former partners as part of the partnership's winding up.
Transfer Arising from Legal Succession Transfer of property when a legal entity or public body is dissolved and its assets are legally passed to a successor entity. An example is the transfer of assets from South African Railways and Harbours to PRASA and Transnet.
Transfer by Virtue of Expropriation Transfer of land ownership to the state through legal expropriation for public purposes. This process requires the state to pay compensation to the person whose land is being expropriated. The land is then registered to a specific state entity.
Sheriff Transfer at Auction Transfer of property resulting from a Sheriff of the Court auction. Typically occurs after a foreclosure on a property due to a warrant of execution, often due to unpaid debt (e.g., mortgage foreclosure).

 

AUCAMP Attorneys: Your Trusted Partner in Property Transfers

The property transfer process can be complex. AUCAMP Attorneys provide expert guidance and support throughout every stage, ensuring a smooth and successful transaction. Contact us today for a consultation.