Legal matters in South Africa

Buying a property in South Africa can be a complicated business with various essential checks required to help ensure that all is in order with the property, including the legal status of the dwelling. Thankfully a good solicitor can help to guide you through the whole transaction process, which typically takes two to three months.

Residents and non-residents can own property without restrictions in South Africa, which arguably has the most sophisticated property registration system in the whole of Africa, helping to ensure that it is guaranteed and secure; people can freely access records of the property interest at the office of the Registrar of Deeds.

In order to purchase a property in South Africa the buyer must provide the following documents:

• Passport and relevant identity documents
• Pre-nuptial contract, if relevant
• Marriage or Divorce certificate, if relevant

Agreement of Sale

When making an offer on a property, an estate agent is legally obligated to prepare a written letter of offer. This will be submitted to the vendor for approval. Both parties must sign upon acceptance. Payment of a 10% deposit is generally paid at this point. The letter of offer effectively becomes an Agreement of Sale that is legally binding to both parties, and includes most, if not all, of the following information:

• Names of the parties involved in the property purchase
• Address and description of the property in South Africa being acquired
• Purchase price and deposits
• Occupation date
• Details of defects and issues that must be rectified before sale
• Clauses relating to mortgages/bonds
• Fixtures to remain within the residence
• Deadlines for acceptance/offer expiration date
• All vendor and buyer details
• Whether an Electrical Certificate or Beetle/Woodborer inspection is required
• The seller can reject or make a counter offer on the Purchase Agreement, however, all changes must be initialled by both parties

Transfer

Once the contract is signed, the seller must appoint a property attorney, or conveyancer, to handle the formal processes of transfer. Your identification documents must be submitted for the registration procedure conducted at the Deeds Registry. This, and the settlement of all the government duties, is usually accomplished in about 10 weeks.

The role of the transferring attorney is to:

• Liaise with the vendor’s bank to ‘cancel’ the existing mortgage and transfer the Title Deeds of the property.
• Contact the municipality for a Rates Clearance Certificate and arrange for any outstanding debts to be cleared.
• Guarantee payment of the seller’s outstanding mortgage to the bank and obtain approval of the mortgage from the financial institution of the purchaser.
• Organise payment of transfer duty, on behalf of the buyer, to the South African Revenue Service (SARS).
• Once all the paperwork has been completed and signed and funding is in place, the deeds are lodged with the Deeds Office, which are then examined, before the registration of transfer of property from the seller to the purchaser takes place, taking up to two weeks.

Completion

As soon as the purchaser’s name has been recorded as the new owner of the property, the remaining balance must be paid. The transferring attorney signs on behalf of the purchaser at the Deeds Office along with the Deeds Registrar and finalises all outstanding financial settlements.

The Power of Attorney in South Africa

If you want to acquire property in South Africa but are finding it difficult to spend the necessary time out there, you could potentially take out a Power of Attorney. This would enable the legal process to continue without you actually being in South Africa yourself. You can nominate a trusted individual, such as a friend, legal representative or relative based in South Africa, who will represent you in specified transactions but this must be recorded as a legal document.

Continue to section 3: Visa and emigration