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PROPERTY TALK
For the Buyer
When buying a property there are several costs to bear in mind which people tend to not be aware of. In this article I will give you some advice on what to be aware of and also what you can do as a Buyer to increase your chances on buying your property of choice. The figures depicted here are for a property to the value of R1,000 000 and a bond value of R1,000 000
1. Banking Costs:
A lot of people are not aware that it costs the buyer money to initiate a bond with any bank. These costs are comparable to Legal Costs and for properties under R750,000 can often be higher than the Legal Costs. The only way to avoid this cost would be to buy a property cash.
2. Legal Costs:
This cost will always be paid and cannot be avoided. The reason being is that you will always need an attorney to perform the legal transfer with the Title Deeds Office. The only way to truly save here would be if you were to buy a“ Plot and Plan” initiative where it is clearly stipulated as part of the contract. Properties under R750,000 would not be liable for the cost of TRANSFER DUTY( ie. R7,500 as indicated in the calculation below) and are exempt of the fee.
CALCULATION EXAMPLE:
BANKING COSTS Bond Registrations Cost R18,240 Initiation Fee R 5,985 Post, Petties, FICA and Other Fees R 1,200
LEGAL COSTS Property Transfer Costs R18,240 Transfer Duty R 7,500 Post, Petties, FICA and Other Fees R 1,200
R25,425
R26,940
Grand Total Cost R52,365
Handy Tips �
These costs would be required above your asking price of the property.
For more advice on property options and the due process of buying,
selling and investing …
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It would be wise to have a saving of about R50,000 per million of the asking price that you are shopping for.
Do not count on the bank absorbing your costs above the bond value. This rarely is catered for by banks directly in the Home Loan. A personal loan could be an option, but would affect your credit score and affordability.
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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