Buying a home is an expensive exercise, not only in the price of the property itself but also with regards to the transfer and bond registration costs involved. This can be a stressful time for buyers, and it helps to budget very carefully beforehand, to allow for certain unforeseen costs that might arise while the transfer is being registered, says Charlene Nolte-Joubert of Henkes Nolte-Joubert and a founding member of the Attorney Realtor Hub (ARH).
Transfer and bond costs, Deeds Office and transfer duty fees are all calculated according to the price of the property being purchased, and a schedule is available from the conveyancer as to what will be payable by the buyer.
In addition, one needs to budget for disbursements such as telephone calls made by the conveyancer’s team, printing, FICA requirements, and other general costs incurred to complete registration of transfer.
Some transfers are slightly more complicated, where there are additional actions to be carried out which will incur extra costs and will be added to the buyer’s invoice by the conveyancer.
- If the unit bought is in a sectional title or HOA complex, the conveyancer will prepay an amount to the body corporate or HOA to cover the cost of the levy clearance certificate and levies due for the first month from 4. date of registration of the transfer as well as the electricity deposit and other additional fees (security or garden fees, for example), and provision will be made to cover approximately R4 000.
- Insurance certificate (in the case of a sectional title unit). While the complex as a whole will be insured under one policy, the conveyancer needs to show that the unit being sold has an active policy over it and will request one from the insurance broker. This will cost from R750 to R1 500 (this amount is only applicable where a bond is being registered over the property).
- Notarial Deed of Cession. This fee cannot be anticipated beforehand and will only become prevalent once the transfer is in process. This is needed where there is a separate title deed for a garage or garden (as an exclusive use area) in a sectional title complex. If this applies, then the conveyancer will charge for the extra documents required and will add approximately R2 500 to R 4 000 to the amount payable by the buyer.
- Bond registration initiation fees. The bank will charge roughly R6 000 to value the property and grant the bond. This is not the bond registration fee, however, which is a separate amount calculated according to the bond amount.
Sellers, too, might have to budget for additional costs:
- If the title deed is lost, the conveyancer will need to apply for a copy, which the seller must pay for. The copy is needed as this will be lodged with the transfer documents. This might cost approximately R3 500.
- If there any mistakes on the title deed, such as a spelling errors or incorrect digits on the identity number, for example, this will have to be corrected first and will cost roughly R2 500, for the seller’s account.
- Sometimes general power of attorney is granted to a third party where the seller is overseas or not able to be present to sign the necessary documents. This will cost from R2 000 to R3 000 and the cost would include authentication as well as being lodged with the Deeds Office.
- Sellers often do not realise that they might have to budget for repair work on their home’s electrical and plumbing system in order to get a compliance certificate, and these costs should be factored in.
These fees will vary slightly from case to case, but an estimated extra budgeted amount should be put aside by buyers and sellers alike, so that they are not caught short and have to worry about the added amounts payable, says Nolte-Joubert.