GUIDELINES FOR PURCHASERS WHEN BUYING IMMOVABLE PROPERTY
Buying a house is probably the biggest and most important investment you will ever make. Herewith a few simple guidelines when you find a property that you are interested in buying:
- Mandatory Property Defects Disclosure Form: The Property Practitioners Act (PPA) (Section 67) requires property practitioners to ensure that sellers complete and sign a disclosure form with them. This form must be attached to any agreement for the sale or lease of a property. If such a Disclosure Form was not completed, signed or attached, the agreement must be interpreted as if no defects or deficiencies of the property were disclosed to the purchaser.
Examine the house thoroughly and ensure that all defects listed are explained to you and pointed out. Should you want an expert to examine the house to check the condition of the roof or foundation etc., you can insert this as a special condition on your offer.
- Fixtures and Fittings: Make sure you understand what the Seller will remove when vacating the property.
- Validity of Offer: An Offer to Purchase signed by you and then accepted by the Seller becomes a binding agreement. Therefore, make sure that all “promises” made by the Seller forms part of the written contract. Verbal agreements are not enforceable. Make sure that your offer is valid for a certain period of time.
- Costs: Ensure that you are aware of the costs involved, and that you understand the financial implications.
- Registration of Mortgage Bond: Should you require a bond to purchase the property, also make provision for the costs involved when registering a bond, as well as valuation fees charged by the banks.
- Deposit: Should the Seller require a deposit, you need to be able to pay this within a certain period after the offer is accepted by the Seller.
- Important Dates and Timelines: Take note of the registration date and the date of occupation in the deed of sale. Should the date of occupation be before the property is registered in your name, you would be expected to pay rent. Make sure who is responsible for the payment of taxes, levies and insurance premiums during this period.
- Municipal Plans: South African law doesn’t mandate that sellers provide approved building plans during a property transfer. While the “voetstoots” clause (selling as is) protects sellers from minor defects, it doesn’t cover undisclosed latent defects, such as unauthorized structures. If a seller knowingly hides the lack of approved plans, they could be held liable.
Should you intend to renovate the property, ensure that you are aware of any Title Deed Conditions that might have an impact on your planned renovations, or any Municipal By-Laws.
Seeking the advice of professionals prior to signing can ensure a smooth and beneficial transfer for both parties. For the best legal advice and personalized service, email us