PURCHASING A PROPERTY
IN SOUTH AFRICA
For foreign nationals there are, at present, few restrictions to purchasing a property in South Africa
Purchasers who are not citizens and who do not have, or wish to acquire, permanent residence may buy outright for cash and will normally be granted a ninety day visa (with possible extension periods) for each visit. However, intending immigrants who have already applied for permanent residence and who can prove a secure source of income and verify that they already have funds in transit to SA may qualify for a mortgage bond of up to 50% of the value of a property they wish to purchase.
The SA Immigration Laws are reviewed frequently so please consult your local SA Consulate at an early stage for the latest personal and financial requirements governing immigration, permanent residence and citizenship.
The vast majority of properties in SA are held under freehold title and the process of purchase is simple and quick. In brief, the system works like this.
In cases where a property is purchased through an estate agent acting on behalf of a seller the price normally includes agent's commission which is payable by the seller. A contract of sale is drawn up by the estate agent and no attorney need be involved at this stage However, a specialist conveyancing attorney, normally nominated by the seller, will be required to effect transfer of the property into the name of the purchaser. Transfer costs are payable by the purchaser. The process of transfer requires anywhere from one to three months depending on the complexity of the transaction. The title deeds registration system is, however, excellent.
Since an attorney is not required to complete the initial stages of a purchase, buyers should be fully aware that when they make a written offer for a property through an estate agent it is normally irrevocable and once accepted by the seller, becomes a binding legal contract. It is wise, therefore, to exercise caution and to choose your agent carefully!
Although not general practice, a purchaser may appoint his own buyer's agent who will represent him and not the seller. Under the Estate Agency Affairs Board's Code of Conduct such an agreement must be in writing and the buyer's agent is obliged to inform the seller that he is representing the interests of the buyer. In such cases the purchaser rather than the seller is responsible for payment of the agent's commission. This system can work well for overseas purchasers with little time to spare.
Finally, buyers should be aware that the costs associated with the purchase of a property in South Africa are significant and that they are payable before the process of transfer can take place.
© denton-miller estates 2001
