Wowos Club

To view properties, click on the links below. ​

1. 2 Beds, 1st floor unit, one carport: 32 Pavilion Heights, 24 Logan Avenue, Highveld, Centurion, 0169 (Buy now).
2. 1st Floor townhouse (three (3) bedroom with one ensuite in the main bedroom), The Pines, c/o Shelanti and Jean Avenue, Die Hoewes, Centurion (Buy now).
3. Reduced: 3 Bedroom House for Sale in Rowallan Park, Gqeberha. 
4. 4 Beds, generously sized bedrooms and two stylish bathrooms (Buy now).

Sold: 

1. 2 Beds, 1st-floor unit, one carport: 37 Pavilion Heights, 24 Logan Avenue, Highveld, Centurion, 0169.  
2. 2 Beds, ground unit, one carport: 29 Pavilion Heights, 24 Logan Avenue, Highveld, Centurion, 0169. 

Remember, transfer costs are paid by the buyer of the property, to a conveyancing attorney who is appointed by the seller of the property. Bond registration fees, on the other hand, are paid to the bond attorney, who is appointed by the bank to register the bond in the homebuyer’s name.

 

When buying in sectional titles, always consider the following five major points and questions:

 

1.         Levies of the complex/home association. How much are the levies? 

2.         How much reserves does the complex/body corporate have, and how regularly do they increase their levies? 

3.         Reserves are essential and can be used to measure the management of the complex by the trustees. 

4.         What improvements and maintenance work has been done in the last year or two? 

5.         What are the levies covering exactly? For example, levies in other complexes cover water usage, security (armed and response), biometrics systems, etc. 

2 May 2024

 

Summary of our discussion today regarding tax and rental properties

 

Johannes Nakana asked, “Do you guys pay Property Tax and also tax on what you earn from the properties? How does it work?”

 

Our member Nathaniel Fadiran responded as follows:

 

“Property tax is for owning property that utilises communal features such as public roads to the land, sewerage, electricity, etc. So, if you own property in whatever form, you will pay property taxes.

 

If you earn money from using the property and it ends up on a positive balance sheet (rental income less expenses such as bond interest, taxes, rates, insurances, etc.), then you ought to pay tax on that ‘profit’/gain.

 

Your part is to run your business thoughtfully and accurately.” 

 

Thank you for reading. 

Question 1: I am buying a house through the seller's estate agent. What are the things that I must be aware of, especially when it comes to bond transfer/deeds registration? 

Any advice would be highly recommended

Answer 1: When buying with a bond, there are two parallel attorney processes:

(a) Transfer Attorney - Appointed by the seller (usually by the estate agent). Handles transfer of ownership at the Deeds Office.

(b) Bond Registration Attorney - Appointed by the bank granting the home loan. Registers the mortgage bond over the property.

Key Things to Be Aware Of: Offer to Purchase (OTP): This is legally binding once signed.

* Suspensive condition (bond approval deadline).

* Occupational rent clause.

* Electrical, beetle, gas, compliance certificates.

* Fixtures & fittings list.

Do not sign without understanding penalty clauses.

Once the bank approves your bond:

• Check the interest rate (linked to South African Reserve Bank repo rate).

• Confirm whether it is a linked rate, a fixed rate, or a variable rate.

• Watch for initiation fees, service fees, and credit life insurance requirements.

The buyer usually pays:

1. Transfer costs (to transfer attorney)

2. Bond registration costs (to bond attorney)

3. Transfer duty (if applicable)

Transfer duty is paid to the South African Revenue Service (SARS).

If the purchase price is below the annual exemption threshold, no transfer duty applies — but it must still be cleared with SARS.

If the occupation happens before registration, the buyer pays occupational rent. If the occupation happens after registration, the seller pays occupational rent.

Make sure:

• The daily/monthly rate is clearly stated.

• The risk and insurance responsibility are clear.

Registration cannot proceed unless:

• Municipal rates clearance is issued.

• Body corporate levy clearance is issued (if sectional title).

Delays here are common.

Typical timeline (if no delays):

• Bond approval: 1–2 weeks

• Guarantees issued

• Clearance certificates obtained

• Lodgement at Deeds Office

• Registration: ± 6–10 weeks total

Red Flags to Watch For

• Estate agent pushing for early occupation without safeguards.

• Unclear compliance certificates.

• No written breakdown of costs.

• Transfer attorney not communicating.

• “Bridging finance” pressure without full disclosure.

Practical Advice

✔️ Ask for a full pro forma statement of costs upfront.

✔️ Keep proof of every payment.

✔️ Insure the property from the date of risk transfer.

✔️ Do a final inspection before registration.

✔️ Confirm guarantees are issued before cancellation of the seller’s bond.

Even though the seller appoints the transfer attorney, the attorney is legally obliged to act impartially in the conveyancing process. However, never hesitate to seek independent legal advice if you are uncertain.

Sources:

Core Legislative References (South Africa)

Deeds registration process:

Deeds Registries Act 47 of 1937

Transfer Duty Act 40 of 1949

Home loan regulation:

National Credit Act 34 of 2005

Regulation of estate agents:

Property Practitioners Regulatory Authority

Transfer duty administration:

South African Revenue Service