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PROPERTY TALK
For the Buyer
The has been much confusion for the Buyer regarding the different terms used while buying a property ; more specifically around the legal and transfer side . This should help clear up the confusion on the different terms .
TAX : Recently the Finance Minister announced a increase in the value that you can buy for without having to pay Transfer Duties . Property ’ s with the value of R900,000 and less are exempt of the Transfer Duty . This increased from RR750,000 . I have had many buyers thinking it is an opportunity to purchase a property without being liable for certain costs . Unfortunately that is not the case . The Transfer Duty is simply the tax due to the government on the purchase of a property .
The saving to the Buyer for property under R900,000 would be a saving of about R4,500 … a small amount compared to the other costs . Anything over that value will be susceptible to Transfer Duty .
ATTORNEYS : Other fees that apply on the purchase of a property would be the Transfer Fees . The Transfer Fees is the bulk of the costs for a Buyer . This is the fees payable by the Buyer for the transfer of the property into their name by an attorney . This attorney will be appointed by the Seller .
The smaller yet additional cost is what is termed as “ FICA , Postal and Petties ”. This is normally around R1,500 and is in general an admin fee incurred .
BANKING : If you are a cash Buyer ; then this is where your costs would end . Unfortunately if you are like most Buyers then you will require a bond .
Banks have fees which are charged on the initiation of a bond and the fees are somewhat similar to the Transfer Fees ( More for properties under R1,000 000 ).
SUMMARY : Transfer Fee
Attorneys Costs
Transfer Duty
Tax levied on behalf of the government Bond Registration Banking Fees FICA , Postal , Petties Admin Fees ( Attorneys and Banks )
Handy Tips �
It is wise to save for your costs so that you may use the full value of your bond for the purchase .
For more advice on property options and the due process of buying ,
selling and investing …
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The rule of the thumb is to save R50,000 per R1,000 000 property value .
Having a deposit to contribute to your bond application will help to reduce your Banking Fees as it is value based
Having a deposit above costs is generally wise as it allows you to have some influence on negotiating the interest rate of the bond .
Marc van Heerden Cell : 073 198 9369 Tel : 041 360 0365 marcv @ sothebysrealtype . co . za www . sothebysrealty . co . za Each office is independently owned and operated
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