Fast forward your property transfer
Buying a house is a big decision, one in which the buyer will have invested numerous hours of research, planning and careful consideration. It makes sense then that a buyer would want their property transfer to be finalised as quickly as possible. But while property transfers are of nature a time-consuming process, there are steps buyers can take to make sure the process runs as smoothly as possible. Step 1 – Determine what you can afford Before you start typing your first Google search as you begin browsing the For Sale signs on the net, you should have a clear idea of what they can afford. Determining what you can afford will take careful budgeting and planning, an area where the assistance of a financial consultant will not go amiss. Step 2 – Save for the deposit Once you have a clear sense of what your budget will allow, you can start saving up for the deposit. With the necessary guidance, you will be able to estimate how big a deposit you will be able to save ahead of the time, something that will lower the mortgage amount you need to apply for. This step can be taken far in advance, however, and will benefit you greatly once you do decide to invest in your own property. Step 3 – Assess your credit and get pre-approval Another step that should be taken beforehand, is to analyse your credit record and get pre-approval for a home loan. This will allow you to plan more efficiently by knowing how great a deposit you will have to save up by knowing how great a home loan you can qualify for. Through pre-approval, you remove any unwanted surprises that may have awaited you otherwise. Step 4 – Keep the necessary documentation ready This may feel like skipping ahead, but once you’ve found the perfect home and want to apply for a home loan, you will need to submit a number of documents, including documents you can prepare beforehand, such as copies of your ID and marriage certificate/antenuptial contract (if married). Having these documents ready ahead of time saves you valuable time when you’ve found your dream home. Step 5 – Find a real estate agent Real estate agents can offer you insight into an industry and market that requires all the know-how you can muster. By obtaining the assistance of a trusted real estate agent, buyers are able to minimise their costs and efforts in the property search, while also improving their chances of navigating the legislative processes that come with real estate purchases. Step 6 – Find your ideal home By ensuring that steps 1 to 5 are all taken care of, everything else is smooth sailing, where you can sit back and enjoy the ride without having to worry about the hiccups that could have come up along the way. Limit the time your property transfer will take, step by step. This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)
Find the right home, the first time
2020 has been an unpredictable year, to say the least. Each new week seems to hold its own uncertainties and concerns. In such times, it is important for tenants of residential property to know what their rights are in terms of premature cancellation of lease agreements that may be necessitated by COVID-19, the pursuant lockdown and general change of personal circumstances. As a point of departure, the tenant can consult the lease agreement to check if there are any provisions pertaining to early cancellation. If there is no such clause, or the terms of the clause are unacceptable, the tenant can turn to the provisions of the Consumer Protection Act 68 of 2008 (“the CPA”), if applicable. The CPA will be applicable to residential lease agreements, except in rare circumstances. Consult with your lawyer to determine the CPA’s applicability to your lease agreement. If the CPA is applicable to the lease agreement, the tenant would be able to lawfully cancel the lease agreement at any time, even if there is no cancellation clause in the agreement. Section 14(2)(b) of the CPA states that a tenant may cancel the lease agreement, despite any provision of the lease agreement to the contrary, by giving 20 business days’ notice in writing. There may however be financial consequences for the tenant as the landlord can impose a reasonable cancellation penalty on the tenant upon early cancellation. There are guidelines in Regulation 5 of the Act as to what a “reasonable cancellation penalty” entails. The cancellation penalty should not be exorbitant, and if the tenant feels that the landlord’s claim is excessive and unfair, they can approach the National Consumer Tribunal or the Rental Housing Tribunal. Tenants can also approach their lawyer, who can address the landlord and negotiate a reasonable cancellation penalty, considering the relevant facts of the matter. Upon expiry of a fixed-term lease agreement the lease agreement will automatically carry on a month-to-month basis, unless the tenant expressly agreed to the renewal of a further fixed-term or the tenant terminated the agreement upon the expiry date. In such a case, the provisions of the Rental Housing Act 50 of 199 are relevant. The landlord can cancel the lease agreement, in terms of the Act, by giving one calendar months’ notice. In Luanga v Perthpark Properties Ltd 2019 (3) SA 214 (WCC), the Western Cape High Court held that one month’s notice must be interpreted as a notice given before the end of the month, to terminate the contract at the end of the next month. There are therefore various considerations at play when a tenant considers premature cancellation of a lease agreement. To avoid unnecessary disputes and an exorbitant cancellation penalty, a tenant would benefit from consulting their attorney before giving notice of cancellation to their landlord. This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)
The most reliable investment in the market
Buying real estate is more than finding the right home or location for your business – owning property is an investment that holds more benefits than you might know. Income Predictability While interest rates may alter mortgage repayments at first, real estate offers a somewhat constant financial investment. Once home loans are repaid in full, real estate offers the owner a constant income that does not fluctuate with the market, an income that can increase with inflation. Of all the investment types, real estate is the safest from external influence. Increasing Value Property appreciates in value over time. Thanks to South Africa’s reliable climate, real estate investments rarely depreciate due to natural causes, so long as the property is well looked after by its tenants and owner. Appreciation levels have increased at 6% per year, on average, since 1968, meaning your investment will grow no matter what. Improve Your Investment Where other investments rely on the financial market, the greater economy and an organisation’s performance to increase their value, property value can be greatly improved by improving the actual property. With a little elbow grease and dedicated planning, you can increase the value of your investment yourself. Retirement Ready A great benefit of owning property is that it is there when you need it the most. While the initial burden of home loan down-payments on cashflow can be rather strenuous, the weight lessens considerably over the years as the principal reduction increases. This means that your cashflow will increase as you near retirement, allowing you to invest your money more appropriately. Up Your Equity While you pay off your home loan, you are also increasing your equity as your property counts as an asset in your net worth. Through increased equity you will be able to gain more leverage in financial situations, when obtaining a loan, for example, and you will be able to grow your wealth more steadily as well. Portfolio Diversification Real estate investment holds less risk than other major class investments, allowing you to create a diversified and safer investment portfolio. Through a diversified investment portfolio, you ensure that your investments are not all influenced by the same external factors, such as a fall in share value (as has been seen during the COVID-19 pandemic). When you start looking at investment options, it may be a wise decision to consider including real estate in your portfolio early on. Remember to reign in the assistance of the experts to help you find the perfect property to invest in. This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)
Cancelling a lease agreement during COVID-19
2020 has been an unpredictable year, to say the least. Each new week seems to hold its own uncertainties and concerns. In such times, it is important for tenants of residential property to know what their rights are in terms of premature cancellation of lease agreements that may be necessitated by COVID-19, the pursuant lockdown and general change of personal circumstances. As a point of departure, the tenant can consult the lease agreement to check if there are any provisions pertaining to early cancellation. If there is no such clause, or the terms of the clause are unacceptable, the tenant can turn to the provisions of the Consumer Protection Act 68 of 2008 (“the CPA”), if applicable. The CPA will be applicable to residential lease agreements, except in rare circumstances. Consult with your lawyer to determine the CPA’s applicability to your lease agreement. If the CPA is applicable to the lease agreement, the tenant would be able to lawfully cancel the lease agreement at any time, even if there is no cancellation clause in the agreement. Section 14(2)(b) of the CPA states that a tenant may cancel the lease agreement, despite any provision of the lease agreement to the contrary, by giving 20 business days’ notice in writing. There may however be financial consequences for the tenant as the landlord can impose a reasonable cancellation penalty on the tenant upon early cancellation. There are guidelines in Regulation 5 of the Act as to what a “reasonable cancellation penalty” entails. The cancellation penalty should not be exorbitant, and if the tenant feels that the landlord’s claim is excessive and unfair, they can approach the National Consumer Tribunal or the Rental Housing Tribunal. Tenants can also approach their lawyer, who can address the landlord and negotiate a reasonable cancellation penalty, considering the relevant facts of the matter. Upon expiry of a fixed-term lease agreement the lease agreement will automatically carry on a month-to-month basis, unless the tenant expressly agreed to the renewal of a further fixed-term or the tenant terminated the agreement upon the expiry date. In such a case, the provisions of the Rental Housing Act 50 of 199 are relevant. The landlord can cancel the lease agreement, in terms of the Act, by giving one calendar months’ notice. In Luanga v Perthpark Properties Ltd 2019 (3) SA 214 (WCC), the Western Cape High Court held that one month’s notice must be interpreted as a notice given before the end of the month, to terminate the contract at the end of the next month. There are therefore various considerations at play when a tenant considers premature cancellation of a lease agreement. To avoid unnecessary disputes and an exorbitant cancellation penalty, a tenant would benefit from consulting their attorney before giving notice of cancellation to their landlord. This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)
Better renovations, better results
It is understandable that home confinement has left many homeowners’ minds flooding with home improvement and renovation ideas. But however much your home may benefit from a good touch of elbow grease, thinking things through carefully is vital. Many may have identified ways in which they can make their homes more comfortable and enjoyable. Others simply want to update the style of their homes. And whether it entails sprucing up bathroom fixtures or installing a kitchen island, these renovations can drastically alter the appearance of your home and can change a worn-down abode to a piece of prime real estate. Most professional renovations, especially structural ones, can also lead to enhancing the value of a property that is entering the market. For others, renovations are done precisely to avoid moving to a new home. When one can alter your home and make it feel brand new, the urge to move will be minimised, allowing you to avoid the stress and costs related to moving house. Whatever the reason for the renovation, it should be approached thoughtfully and carefully. Focusing on smaller parts of the big picture will help you approach the renovation systematically, ensuring minimal pressure and maximum success. This will allow to contract the necessary parties only once they are needed. Doing this will also allow you to manage your budget accordingly as the renovation progresses. Budgeting is a vital part of any successful renovation. Renovations often rely on continuous funding, where a shortage of funds mid-way could alter the success of the final outcome. To budget effectively requires copious amounts of research, which includes finding the most appropriate and cost-effective material, and the best professionals to help you, but it also includes more technical aspects. You should always enquire about the regulations that may inhibit your renovation or require it to be altered. Doing the necessary research regarding allowable renovations and obtaining the necessary permissions when they are needed is necessary to ensure success for your renovations. Beyond regulatory permissions, it is also advisable to obtain the advice and guidance of an environmental specialist, especially when you reside in a nature reserve or estate. Ignoring environmental issues can also lead to adverse effects brought about by your renovations, such as the disturbance of underlying water sources. Whenever the structural security of a building comes into play, the advice of an architect is of utmost importance, especially where previous renovations have been done. Previous work may not have been completed to the same standards as the primary work and may require careful work and may even prohibit additional work surrounding any previous faulty work. Getting the necessary electrical and plumbing expertise will also ensure that you do not end up with a ticking time bomb hidden inside your renovation. Finally, it is important to keep in mind that renovations take time and will disrupt your living experience. Patience is more than a virtue when it comes to renovations – it’s a non-negotiable requirement. Even the smallest renovations are wonderful ways to give your living experience a boost. But no matter the size of the task, approaching it with the right mindset, patience and assistance is vital. This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)
Considerations before the biggest decision of your life
Purchasing a home is one of the biggest decisions most people will make in their lives. It makes sense then that this endeavour should be approached with diligent consideration and care. While the necessary assistance of professionals, who will help you make the best decisions along the way, is highly advisable for this journey, there are a few tell-tale signs you can spot yourself that will help you identify whether a property deserves another moment’s consideration. Once a house become a showhouse, a magical veil is drawn over a mundane property that allows it to appear like a home right out of a movie or magazine. It’s undeniable that first impressions leave lasting impressions, which is exactly why homeowners may try to cover up any defaults by dazzling you before you find out something is amiss. It is important to not let first impressions affect your judgement. Because of this, it is vital that you investigate thoroughly. If you are serious as a buyer, and the seller is serious about selling, the seller should not have a problem with allowing you free reign through the property (even if it is supervised by them). Like a real estate Indiana Jones, you should explore every inch of the property. Open doors, flush toilets, test the taps, flip every switch you can find, jump on the floors (especially upstairs) – go all out. During this exploration, it’s important to pay attention to cracks, even minor ones, and doors that struggle to close. These occurrences may indicate foundational problems. When you find either of these, it is best to have a structural survey completed beforehand. You should also pay attention to any fresh coats of paint, especially when found in selected patches. If an entire room has been repainted, it is advisable to enquire as to the reason for the repaint, but when a patch of paint is visible it usually indicates an area where damage has been patched up. Getting to the bottom of such damages is important. As you travel from room to room, it is also good to get a feel of the climate within the house. You shouldn’t have to imagine what a room would feel like once you have a new air-conditioning or heating system installed. If the house’s interior temperatures are not accommodating, you need to consider to what extent this will influence you. Once you’ve done the rounds inside, remember to take a tour of the exterior as well. It’s a given that you should inspect the condition of the yard and the roof, but you should also ascertain the state of the neighbours’ properties where possible. This will not only help you get a feel of property itself, but also of the community that will ultimately affect your living experience and the value of your property. All of that said, it is also important to be able to see beyond minor shortcomings and the current state of things. An unkempt yard, unvarnished kitchen counters, clutter throughout the house – these are all factors that can be given the necessary attention in time. When you tour a property, it is important to envision your home, as you would want it. While there are various deal-breakers, especially when it comes to structural security, there are also many shortcomings that may make a bad first impression that should not inhibit you from seeing the potential of the property. Go in with a plan. Ask questions. Demand answers. It’s your future home – it’s worth the trouble. This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)
Moving regulations during the lockdown
We’ve all felt like it – the hairs on the back of your neck standing up, sure someone is keeping an eye on you, watching as you receive a DVD box set that was for some reason labelled “essential” on the online store, sneaking in at 09:20 after the morning jog you were sure was shorter yesterday, or absent-mindedly fixing your mask as you stand in the chocolate aisle at the supermarket. Feeling like you are crossing a line has become part of daily life and moving during the lockdown may have many people feeling just as guilty. But as with most regulations, things have changed (except for the mask part – it’s best to just ignore the tickle till you get to your car). Moving during Level 3 is allowed, and with the effects of the lockdown touching so many lives, a very possible occurrence as landlords and tenants alike seek their footing. The good news is that moving safely is entirely possible. The most important element is following adequate safety measurements throughout the process. Businesses operating under Level 3 are all required to have an adequate safety plan in place, with a COVID-19 Compliance Officer that oversees the company’s compliance with the necessary preventative measures. These requirements ensure that estate agents and transport companies keep every person involved in the move safe. These are the most important guidelines to follow when moving: Get the necessary permits from a SAPS office that will allow you to travel during the lockdown. Adhere to social distancing and keep a minimum of 1,5m between yourself and the transport team. Have sanitiser handy to offer to all parties before and after the move. Sanitise the surfaces of the old property once furniture has been removed; sanitise surfaces in the new property both before and after furniture has been moved in, as well as the furniture itself. Be kind with your words, not your actions, for the time being. These precautions are there for a reason. The real estate industry relies heavily on multi-channel interaction and is, consequently, at high risk. This has been seen in the Johannesburg and Pretoria deeds offices, which were forced to close temporarily on June 12 after conveyancers in the building were tested positive for the virus, and the Cape Town deeds office, which has already closed twice for the same reasons. While moving is allowed, tenants are still encouraged to move into a new safety bubble only if it is truly necessary. When moving is truly the only option, ensure that the necessary safety precautions are adhered to. This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)
The tenant-landlord relationship
The relationship between landlord and tenant is a symbiotic one, where the efforts of either party results in the best outcome for both parties. During the lockdown, this two-way relationship between many tenants and landlords has been threatened. The biggest contributor to this is quite simple: a lack of information. Paying your dues One of the biggest impacts the lockdown has had on tenants is through affected income. Unfortunately, tenants are still required to pay the full rental amount if they are still able to occupy the property, regardless of how their income has been affected. Where income has been affected, tenants should discuss the possibility of a reduced rent directly with their landlords. Landlords, however, also rely on rental income and cannot always afford to lower rental amounts. When this is the case, tenants can, technically, apply to the Rental Housing Tribunal to request a reduction in rent, but due to new cases not being heard at the moment, such a request is unlikely to be successful. The best option is for tenants to apply for State assistance, and so ensuring the least impact on both parties. With these types of requests, it is important to note that landlords will have to be furnished with relevant personal information of the tenant to corroborate a tenant’s inability to pay their rent. The landlord will, however, be responsible for guarding the privacy of their tenant’s personal information in such a case. Sticking to the rules Even when the relationship is no longer a beneficial one, and becomes filled with strife, landlords may not terminate a lease or refuse services to tenants and may not insist on conducting an investigation of the property without the tenant’s express permission. Similarly, tenants may not cancel their leases during this time either. Such “threatening” actions are highly discouraged while the country is in any level of the lockdown. As before, a tenant’s deposit may not legally be used to cover rental arrears, but only for its intended post-rental purposes. Deposits, along with the accrued interest, must be refunded to the tenants upon their exit, where only the necessary cost of repairs may be deducted. Landlords are also still responsible for the maintenance of their properties, and for ensuring liveable conditions for their tenants. During any maintenance procedures landlords and workmen are obliged to adhere to social distancing and must follow adequate sanitising methods throughout. The landlord must also provide the necessary clothing and equipment for the procedures to be completed themselves. End of lease But while tenants may not be evicted and leases may not be terminated, the reality is that leases do come to an end. As far as possible, tenants and landlords are encouraged to continue their relationship, even if just on a month-to-month basis until moving house can be done without safety hazard. Where the continuance of a lease is not possible, tenants should obtain a permit from the SAPS allowing them to move freely during their relocation, and follow strict safety measures throughout the process. This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)
How is your property’s value being affected?
Preparing a home that will soon enter the market is one of the first steps of the selling process. But these preparations, intended to make a property more attractive for prospective buyers, should always be approached carefully and, above all, strategically. These are a few key elements that may affect a property’s ultimate attraction without you even realising it. Reign in the Renovations Extravagant landscapes and renovations may seem like an easy way to increase the value of a property, but in practice, a property of a certain size and class will most often fall into the same price range as other listings of the same size and class, no matter the extravagance. Overly elaborate landscaping may also frighten off potential buyers once the necessary maintenance dawns on them. When it comes to renovations, the best route is to keep it simple and essential. The addition of easy-to-care-for shrubs or flowers will go further in most cases than the most beautiful Italian fountain on the market. Neighbourly Negligence Robert Frost, in his poem Mending Wall, famously said, “Good fences make good neighbours”. When it comes to the value of your property, the fences may not be good enough, though. No matter the lengths you have gone to in creating the most immaculate piece of real estate conceivably possible, the moment a prospective buyer sees the rusted cars resting on bricks next door or the plump rats keeping an eye on things from the gutters of your neighbour’s house, the possibility of a successful sale will undoubtedly be affected. Unless, of course, the potential buyers are looking to renovate a car or take home a pet rat, that is. It may not seem a pleasant endeavour (depending on the pleasantness of the neighbours) but giving your neighbours a helping hand in fixing up their property may prove quite beneficial to the attractiveness of your own property. And finding a solution to Rex’s constant barking in the early morning hours will benefit both your rest and your sale. Likened Listings When your property is simply a drop in the ocean, the chances of buyers finding it are minimal. Especially in times of economic change, the numbers of similar property listings increase, minimising the chances of your property being noticed. But waiting for a time in which your listing can stand out may cost you valuable time and prospective buyers. The answer here is a unique marketing approach — something an innovative agent can easily assist with. With the necessary expertise and understanding of real estate marketing, finding that special something that will put your listing on the map is a piece of cake. Face the Facts This is not an element that can affect your property’s attractiveness — this is advice. Some things simply are what they are. While building a second garage for storage space, cleaning up your community, and launching a petition against the McDonald’s that recently planted its Golden Arches just outside your main bedroom window are all possible ways to increase your property’s attraction (theoretically speaking at least), they are not very viable. Instead of trying to alter the factors that out of your hands, it is essential that you aim your efforts at the factors you can alter. If you still want to sign up for that local community watch programme, though, go for it. Just don’t do it to try and up your selling price. This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)
The new age of property viewings has arrived
The real estate industry has always been known for utilising the latest technologies available to bring buyers and sellers together. From announcements at Town Hall gatherings to the printing presses, the introduction of radios and television sets in households, and finally the World Wide Web, property practitioners have always been on the lookout for the best means to publicise property. In the COVID-19 world, though, this has become a bit more difficult. But once again, the latest technology is helping us do just that. With the assistance of Matterport and ZOOM, agents are able to take prospective buyers through what may be their new home, from the comfort of their own home thanks to virtual viewings. The virtually viewed property is built off of actual panoramic footage that is synthesised into a dimensionally accurate 3D model on Matterposrt’s unique platform. Going from room to room, viewers will be led through the property and are able to ask questions along the way. Where a virtual tour may, in fact, even trump a physical viewing, is in the ability to view the property as a scale model, almost like a doll’s house, allowing the prospective buyer the opportunity to see the property in a way they may never have thought of before. Where Matterport tours are not available yet, basic ZOOM meetings can be arranged where the seller of the property will take the agent and prospective buyer on the grand tour. While buyers may not be able to see the doll’s house version of the property, they will still have the opportunity to be guided through the property and gain valuable information as the tour proceeds, being able to ask questions immediately if something catches their eye. Offers made during this time, based on virtual viewings alone, will be subject to physical viewings post lockdown. But with the help of virtual viewings, buyers and sellers can ensure they are ready to hit the ground running as soon as the lockdown alert level allows. The world may never be quite the same again, but when it comes to the real estate market, that may just prove to be a good thing. Through the technological avenues that estate agents have been using to keep the market as active as possible, a more efficient way of approaching property viewings may be here to stay, even when the world gets a clean bill of health again. This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)