Before the outbreak of the pandemic and the subsequent lockdown in South Africa, it took an average of two to three months to sell a house. Since the lockdown started, real estate agencies had varied experiences of the property market, but after the uncertainty of the past months, the property market is back in full swing!
With the record-low home loan interest rate it is a buyer’s market. Lower interest rates mean lower monthly repayments, which created the opportunity for new prospective buyers, who were not able to buy before. It also created an environment for property investment.
The lockdown has changed our perspective and caused us to reassess our lives. With so many people forced to work from home that improved the quality of family lives, there is a demand for larger homes. On the other hand there are those who want to downsize after facing salary cuts or loss of employment.
These factors could affect the sale of your house:
- The condition of your house as a whole. For 7 Tips on How to Increase Your Home Value, refer to the post elsewhere on our website. You might have to revamp your house a little to make it more attractive to a prospective buyer.
- If you are not the sole owner of the property and you need another signature to accept an offer.
- Don’t let too many agencies market your home, but rather consider signing a sole mandate that will give one agent the time to secure the best price for your home.
- When obtaining a valuation, some agencies will over-value your property in order to get an exclusive mandate. If the price seems radical, ask them how they reached that price. You could get more than one valuation to ensure that you get a realistic price.
We have almost 40 years’ experience in more than 40 areas around Cape Town. Contact our agent in your area to get a free valuation and to discuss a possible sole mandate.
TIP: If you are not in a hurry to sell, you could consider putting it on the market during a season which your garden looks at its best.
Buying or selling a property is one of largest purchases you will make in your lifetime. By asking the above question, you are probably aware of the importance of an attorney in this transaction. It’s the best way to ensure that the process is legal and fair. Right? So, the answer to this question depends on whether you are the Seller or the Purchaser, and other circumstances.
If you are the Purchaser, you will be paying for the transfer fees, so you probably feel entitled to use an attorney of your choice. The truth is that the Seller is entitled to nominate the transferring attorney, because it is the Seller that authorises the transferring attorney to transfer the property to the purchaser (through a power of attorney).
However, if the Seller hasn’t nominated a transferring attorney yet, it could be open for discussion and the two parties could agree to use the Purchaser’s attorney. If the Seller refuses, the Seller’s transferring attorney must be used. If neither the Seller nor the Purchaser have a nominated attorney, Icon Property Group has attorneys they could recommend. The Seller still has the final say.
The Seller is the owner of the property and it is generally regarded that the Seller is far more at risk. Rest assured that, although it is the transferring attorney’s duty to ensure that the purchase price is secured, the conveyancer will act neutrally on behalf of both parties and wants to see the process run smoothly, as this is how they are paid.
If you are in need of an attorney, contact Icon Property Group for assistance.
You have decided to put your house on the market, or you want to buy a house, and apart from agency commission, you are unsure of other costs that you will have to incur. Don’t get caught off-guard and plan well. You will probably not get as much out of the deal as you expect. There are quite a number of costs you should take into consideration and budget for.
- Bond cancellation: The cancellation attorney will charge anything from R3 000 upwards for administration fees.
- Rates and taxes: The conveyancing attorneys will require a clearance certificate from the municipality that states an up-to-date account. The seller will have to pay upfront to get the certificate.
- Levies (if applicable): Where there is an estate or sectional title property involved, the homeowner’s association or body corporate may request that the seller pays in advance for the levies, to ensure that these costs are covered until the transfer takes place.
- Compliance: Compliance certificates can be complex and costly, but will protect the seller in the long term. These include electrical, gas, plumbing and beetle certificates, and are all the seller’s responsibility. The transfer of the property cannot be concluded without these certificates. We recommend that the seller budgets for at least R1 000 to cover the certificates and possible faults that will have to be fixed.
- Agent: Agent commissions vary significantly. Take into consideration the comprehensive service that they offer with the sale of your house. They offer their knowledge, expertise and time, and they work purely on a commission basis. They pay for the marketing and advertising of your house, and they will guide you through the process. You could consider selling your home privately, but you could end up paying more than agent commission in the end. Do yourself a favour. Pay the full commission that will assure that you get the best possible service from the agent.
Buyers are liable for a number of costs and should prepare themselves for it. You should budget for the following extra costs:
- Bond attorney: You will have to pay a fee to the lawyers that handle the home loan for the bank, prior to the registration of the bond.
- Bond initiation: This is payable to the bank granting the bond. It can be added to the bond amount.
- Transfer: The transferring attorney will charge a service fee.
- Transfer duty: This is tax paid to the government, applicable to properties R1 000 000 and up.
- Municipal deposit: Lastly, a deposit will be required to open a municipality account. This should be done shortly after registration.
Whether you are a SELLER or a BUYER, we are here to assist and guide you. We can assure you of the best service we can offer. Our motto says it all:
LIST • SHOW • SELL
Do you want to sell your house and feel unsure about its value? Where do you start? Your family made many happy memories there and you spent some money to upgrade your house, but will buyers rate its value equally? How much is it actually worth on the property market?
Whatever the case may be, it is very important to determine the correct asking price when you put your house on the market – a price that suits the current state of the market. Buyers who have done some research are well educated about what they can get for their price range. They will look at the overall condition of your property, what it has to offer, the size of your garden, the age of the kitchen and bathroom, etc. If they are in possession of a Pre-approval Certificate for a home loan, they might be in a hurry to buy.
Don’t waste time by doing your own research in an attempt to determine what your house is worth. Be informed and be sure. Call in professional help for an expert evaluation. Contact our relevant agent in your area today to give you a free valuation.
Let me explain to you what it is not! By not getting home loan pre-approval you could end up browsing on the internet and finding your dream house that has all the amenities you ever wanted, in the area that you desire to live in, only to discover that you do not qualify for a bond of that amount. What a disappointment! Buying a house can be a very exciting experience and if you prepare well, you can avoid disappointment, and take a realistic approach to it.
So, you want to buy a house or another property and you’re not sure what you qualify for. There are a few important things you should know.
Before you start looking at houses online, get a home loan pre-approval to know exactly what you can afford. To obtain a Pre-approval Certificate you can go to your bank or a bond originator.
The bank or bond originator will need certain documentation and information from you to determine if you qualify for a Pre-approval Certificate. They will also check your credit score. By using a bond originator you will be able to apply for a bond at multiple lenders. That will put you in a position to compare quotes.
A Pre-approval Certificate will indicate the bond amount and interest rate offered by the bank, and the instalment amount that you qualify for. The bond amount on the Pre-approval Certificate is not a guarantee, but only a guideline for house hunting. With a pre-approved home loan, you will have the assurance that you will get a bond when you find that perfect property, and real estate agents and sellers will know that you mean business. However, the final bond approval is subject to the Bank’s valuation of the property, as well as a signed Offer to Purchase.
Buying a property can be a very daunting experience, especially if you’re a first time buyer. The following might be some of the questions you ask yourself:
- How do I know if I qualify for a home loan?
- What will influence the bank’s decision to approve or decline my application?
- How do I know if I will be able to afford the monthly repayment?
- What do I need to apply for a home loan?
What are the criteria to apply for a home loan?
The loan providers will take the following into account when you apply for a home loan:
- Your age
- Whether you have a permanent income and job stability
- Other additional income (if applicable)
- A good credit record
- Other debt
- The size of the deposit you can put down
- If you will be able to pay the instalments
We advise that you do the following before you even start looking at properties:
- Check your credit score, because the banks will check your credit history, and they will decline your application if you have a low credit score.
- Make sure that all your accounts are up to date.
- Take all costs into consideration (a deposit, transfer duties, attorney fees, insurance – both building insurance and household contents, moving costs, rates and taxes, water and electricity, and levies (in the case of sectional title).
- Use your income or joint income to determine the size of the bond that you will qualify for. Banks usually offer a bond that is equivalent to a repayment amount of 33% of your monthly income. The calculation will be based on the interest rate that they offer to you.
What to include in your application:
- A copy of your ID document;
- Six months’ bank statements (depending on the home loan provider);
- A copy of your offer on the property, containing the seller’s and buyer’s details and signatures;
- A payslip or a letter of employment;
- Proof of income or joint income;
- In the case where you are self-employed, you will need a letter from an accounting officer that confirms your income.
TIP: If you use an online pre-qualification tool to see if you qualify for a certain amount, it doesn’t guarantee that the bank will approve a home loan for that amount. The pre-qualification tool only serves as an assessment to show you what you can afford. However, a pre-qualification certificate will show agents that you are a serious buyer and that you are in a position to apply for a home loan.
So, you have decided to sell your property. If you have a bond on your property that needs to be settled, you can save on costs if you plan well.
Speak to your real estate agent about all the fees payable by the seller. You don’t want to be caught off guard and end up with less than you budgeted for.
First things first
A bond is usually over a 20-year period unless different terms were agreed upon. When planning to sell your property, you have to give the bank a 90-day notice period. This serves as a notification of your intention to sell and to cancel your home loan. In the case where you want to cancel the bond prior to the completion of this period, there will probably be a 90-day early termination fee charged as penalty. This will include a bond cancellation fee, as well as additional charges from the bank. Costs vary from bank to bank, so can check with your bond holder to confirm what their terms and conditions are regarding cancellation fees.
Should your property not be sold within this 90-day period, a new letter must be written for a 90-day notice period. If for whatever reason you decide to withdraw your house from the market, you should inform your bank to withdraw the cancellation of your bond.
Attorney cancellation costs
The settlement figure does not include these costs. Attorney cancellation costs are charged by the attorney to cancel the bond, and are payable directly to the attorney. This fee includes the cancellation in the Deeds office, as well as the administering of the cancellation. The Cancellation Attorneys will be appointed by your home loan bank.