Property Transfer Costs

[ADRAM3L3CH]

Hi All

So I'm in the process of purchasing my first property and just need to know if I'm being taken for a ride regarding some of the transfer fees .

So I have a proforma account with the following amounts apart from all the standard charges .

Rate clearance certificate : R600
Levy Clearance certificate : R800

Rates for 3 months and levies for 3 months .

Is this standard practice ? I was under the impression that all clearance certificates should be for the sellers account , not mine . I don't mind paying for rates and levies if I was living at the property .

 

[Pho3nix]

/subs

 

[Lupus]

Hi All

So I'm in the process of purchasing my first property and just need to know if I'm being taken for a ride regarding some of the transfer fees .

So I have a proforma account with the following amounts apart from all the standard charges .

Rate clearance certificate : R600
Levy Clearance certificate : R800

Rates for 3 months and levies for 3 months .

Is this standard practice ? I was under the impression that all clearance certificates should be for the sellers account , not mine . I don't mind paying for rates and levies if I was living at the property .

Nope you're supposed to pay for those two, the seller has to make sure they are all paid up, you're paying for the benefit of getting the certification to say it's all paid up. What I love is that the lawyers charge different rates for different priced properties, are you telling me it's a lot more work to lodge a million rand place over a 3 million rand place at the deeds office?
Oh also the R1000 for postage and sundries and the other couple of hundred for reading, most of the time lawyers aren't even doing it, it's article clerks.

 

[SauRoNZA]

Nope you're supposed to pay for those two, the seller has to make sure they are all paid up, you're paying for the benefit of getting the certification to say it's all paid up. What I love is that the lawyers charge different rates for different priced properties, are you telling me it's a lot more work to lodge a million rand place over a 3 million rand place at the deeds office?
Oh also the R1000 for postage and sundries and the other couple of hundred for reading, most of the time lawyers aren't even doing it, it's article clerks.

Can't comment on the levies factor as that's somewhat outside the law.

But down in Cape Town the Rates & Taxes clearance as well as Plumbing and Electric certificate are all the seller's responsibility.

Generally the lawyer's fees themselves should be the same regardless of the property. It's the taxes you pay to SARS and the fees to the bank for the bond that will vary based on price of the property.

@bokka1

 

[Lupus]

Can't comment on the levies factor as that's somewhat outside the law.

But down in Cape Town the Rates & Taxes clearance as well as Plumbing and Electric certificate are all the seller's responsibility.

Generally the lawyer's fees themselves should be the same regardless of the property. It's the taxes you pay to SARS and the fees to the bank for the bond that will vary based on price of the property.

@bokka1

Oh yeah sorry, for the levy's one is the buyer, not sure why. The rates should be the seller as far as I know as well. All other clearance certs are normally the sellers problems.

"The Cost of obtaining the Levy Clearance Certificate will be included in this statement as an administrative charge, and is for the account of the purchaser. This cost varies considerably from one managing agent to the next. If a second or third certificate is required, if the transfer process is taking longer than expected, a new statement will be requested, and the managing agent will charge for the re-issue of these certificates too."

That's what I thought, but I'm trying to sell my place and purchase a new one, most of the transferring attorneys charge variable rates depending on the properties values. It's not the tax only it's their actual fees.

 

[Kosmik]

The rates and levies will be offset during occupation and transfer, that is normal practice. Levy clearance is for the purchaser to pay, although the BC couldn't care who pays as long as someone does. Rates clearance is for sellers accounts as is pest, electrical and others.

 

[ADRAM3L3CH]

Nope you're supposed to pay for those two, the seller has to make sure they are all paid up, you're paying for the benefit of getting the certification to say it's all paid up. What I love is that the lawyers charge different rates for different priced properties, are you telling me it's a lot more work to lodge a million rand place over a 3 million rand place at the deeds office?
Oh also the R1000 for postage and sundries and the other couple of hundred for reading, most of the time lawyers aren't even doing it, it's article clerks.

Thanks Lupus, I just wanted to make sure as I don't want to pay for anything I don't have to . Its crazy how charges vary from one lawyer to another , one was more then R5K cheaper !

Can't comment on the levies factor as that's somewhat outside the law.

But down in Cape Town the Rates & Taxes clearance as well as Plumbing and Electric certificate are all the seller's responsibility.

Generally the lawyer's fees themselves should be the same regardless of the property. It's the taxes you pay to SARS and the fees to the bank for the bond that will vary based on price of the property.

@bokka1

That's what I thought , I'm sure in Durban the same practice will apply . I'm not sure about the levy certificate though .

Oh yeah sorry, for the levy's one is the buyer, not sure why. The rates should be the seller as far as I know as well. All other clearance certs are normally the sellers problems.

"The Cost of obtaining the Levy Clearance Certificate will be included in this statement as an administrative charge, and is for the account of the purchaser. This cost varies considerably from one managing agent to the next. If a second or third certificate is required, if the transfer process is taking longer than expected, a new statement will be requested, and the managing agent will charge for the re-issue of these certificates too."

That's what I thought, but I'm trying to sell my place and purchase a new one, most of the transferring attorneys charge variable rates depending on the properties values. It's not the tax only it's their actual fees.

According to private property all certificates are the sellers costs

The costs incurred by the seller are:

Estate Agent's Commission;
Conveyancer's Fees for cancellation of his bond over the property;
Electrical-, Rates and Taxes/Levy- and Infestation Clearance Certificates.
https://www.privateproperty.co.za/a...registration-and-transfer-costs-explained/687

The rates and levies will be offset during occupation and transfer, that is normal practice. Levy clearance is for the purchaser to pay, although the BC couldn't care who pays as long as someone does. Rates clearance is for sellers accounts as is pest, electrical and others.

So if I don't occupy the property until the property is transferred will I be refunded ?

 

[Lupus]

Looking through google, you're liable for the levies clearance cert

Even though the seller pays the levies, the purchaser is liable for the cost of obtaining the actual levy clearance certificate. This is because the latter cost is an administrative disbursement for which the purchaser is generally liable, unless specifically agreed to otherwise by the seller and purchaser.

https://www.stbb.co.za/publications/who-pays-for-the-levy-clearance-certificate-2-june-2015/

It's possible it's changed since 2015, as I honestly don't remember paying for it in 2009, but then again there were so many things I had to pay for.

 

[Kosmik]

So if I don't occupy the property until the property is transferred will I be refunded ?

Yes but more likely you will have a credit with the utility and BC. Both the seller and purchaser put amounts into the lawyers trust account or pay the respective utility for the period during the transfer. Once transfer is complete, the funds are re-allocated.

 

[Venomous]

Hi All

So I'm in the process of purchasing my first property and just need to know if I'm being taken for a ride regarding some of the transfer fees .

So I have a proforma account with the following amounts apart from all the standard charges .

Rate clearance certificate : R600
Levy Clearance certificate : R800

Rates for 3 months and levies for 3 months .

Is this standard practice ? I was under the impression that all clearance certificates should be for the sellers account , not mine . I don't mind paying for rates and levies if I was living at the property .

It is the sellers responsibility to pay up all levies and other charges in a complex. Sometimes this is deducted from the sale amount by the transfering attourneys.

The certificates - that seems to vary. But in most cases that is paid by the seller in GP as tbe lack of those will stop the transfer.



Did you read the fine print prior to signing?

 

[ADRAM3L3CH]

Yes but more likely you will have a credit with the utility and BC. Both the seller and purchaser put amounts into the lawyers trust account or pay the respective utility for the period during the transfer. Once transfer is complete, the funds are re-allocated.

Ok thanks for clearing that up Kosmik !

 

[ADRAM3L3CH]

It is the sellers responsibility to pay up all levies and other charges in a complex. Sometimes this is deducted from the sale amount by the transfering attourneys.

The certificates - that seems to vary. But in most cases that is paid by the seller in GP as tbe lack of those will stop the transfer.



Did you read the fine print prior to signing?

I did read through everything twice and so did my wife , I just checked it again and it just says that the purchaser will pay all transfer costs but no mention of rates or levy clearance . It further goes on to say that all clearance certificates are for the sellers account , hence my confusion why I am being charged for it .

 

[Venomous]

I did read through everything twice and so did my wife , I just checked it again and it just says that the purchaser will pay all transfer costs but no mention of rates or levy clearance . It further goes on to say that all clearance certificates are for the sellers account , hence my confusion why I am being charged for it .

Then you copy/highlight section/scan in the page(s) and send that to whome ever sent you that bill. Tell them as per the written contract can they kindly forward all said costs to the seller, but thank you for keeping you informed...

Don't shout just yet. Stay calm but firm.

 

[ADRAM3L3CH]

Ok will do, thanks Venomous !

 

[Tomtomtom]

So I'm in the process of purchasing my first property and just need to know if I'm being taken for a ride regarding some of the transfer fees .

Rate clearance certificate : R600
Levy Clearance certificate : R800

Hmmm... probably not what you want to hear but I'd say don't sweat the small stuff. R 1400 is 0.07% in a R2-million transaction. It's a rounding error!

It's percentage costs you need to deal with and right from the start. Each percentage point negotiated off the asking price nets an instant R 10 000 for every million, and reduces every proportional fee thereafter. As the buyer, this is also the only way to squeeze money out of the rapacious agent.

Speaking of which, you are probably going to find that your lovely new MA charges some obscene percentage of levy contributions every month... that will make your levy certificate look like gift.

 

[Ruxin]

Hi All

So I'm in the process of purchasing my first property and just need to know if I'm being taken for a ride regarding some of the transfer fees .

So I have a proforma account with the following amounts apart from all the standard charges .

Rate clearance certificate : R600
Levy Clearance certificate : R800

Rates for 3 months and levies for 3 months .

Is this standard practice ? I was under the impression that all clearance certificates should be for the sellers account , not mine . I don't mind paying for rates and levies if I was living at the property .

Yes, the buyer pays those fees. It is standard practice. You can always ask the transferring attorney to give discount on there fee but those clearance fees are about the right price.