Important Questions Buyers and Sellers need to ask
Category Buyers and Sellers
Some important questions that you, as the seller or buyer of property, need to ask your estate agent...
Having been involved in the real estate profession for 38 years at different levels, I have learnt a few important lessons that I love to share with property buyers and sellers. If you have chosen to deal with an estate agent, it is of extreme importance that you, as the client, enquire inter alia the following:
Seller:
- Are the agent and the firm registered with the PPRA and hold valid Fidelity Fund Certificates?
- Explain the local market conditions, i.e. the number of sales and rentals that take place monthly/annually, the average ages of buyers and sellers (to establish their target market), the current financial trends with respect to mortgaging and or cash buyers.
- The costs involved in selling a property (providing compliance certificates, Rates and Taxes clearance certificate, bond cancellation fees and possible penalties, estate agent's commission, possible Capital Gains Tax payable if the property is not the seller's primary residence, or even if it is, and the gain exceeds R2m, or the size of the property exceeds 2ha).
- Knowledge of the acts pertaining to estate agency, property sales and ownership. This would include the impact of the following acts on you, the client, where applicable: The Alienation of Land Act (ALA), The Property Practitioners Act (PPA), The Financial Intelligence Centre Act (FICA), The Consumer Protection Act (CPA), The Community Scheme Ombud Service Act (CSOSA), The Sectional Titles Act and The Sectional Titles Management Act, etc.
- Knowledge of all the legal aspects pertaining to all contractual aspects of selling, especially the terms and conditions of the agreement of sale in particular and the general principles of contract. Very pertinent issues would inter alia be, e.g. 'The Property Condition Report'; 'Defects and the Voetstoots clause'; 'What is included in the sale?'; 'Occupation and Occupational Consideration'; Cooling Off Rights'; the timing of Risk passing to the purchaser'; 'the meaning of Suspensive and Resolutive Conditions'; the requirements for a valid Offer to Purchase and a valid acceptance by the seller'.
Buyer:
- Are the agent and the firm registered with the PPRA and hold valid Fidelity Fund Certificates?
- The residential estate agent that operates in a certain geographical area should be aware of the local market conditions, in order to be able to inform potential buyers of the current local market in particular to different areas in the environment where they prefer to buy. (Position is key).
- The costs involved in purchasing a property (optional deposits, mortgage bond costs, conveyancer's fees, Transfer Duty vs VAT, Deeds Office Registry Fees, Municipal provision for Rates and Taxes, possible occupational consideration and even the possibility of being held liable for payment of the Seller's taxes if the seller is a non-SA resident!)
- The Acts and legal aspects as described in 4 and 5 above are also applicable to buyers.
- It is of particular importance that potential buyers supply the necessary information pertaining to the Financial Intelligence Centre Act (FICA) to combat money laundering, terrorist and proliferation financing. The agency is an accountable institution in terms of this Act and is compelled to collect these details.
These are just a few of the basic issues that are of vital importance to buyers and sellers of property in South Africa.
Should you require any clarity or more information, please do not hesitate to call me for a chat.
Pam Snyman
Author: REDZetc
