Selling a property - construction before transfer?

[Dolby]

My girlfriend is selling her property after a long battle with a squatter etc. The buying process doesn't seem to be going smoothly as well and as a first time seller, she's listening and taking advice from the agent.

For one, transfer hasn't gone through yet (ETA June) - but agent is saying that new buyer can already come in and start tiling etc. Surely this was wrong advice?

Also, regarding occupational rent, is there a stipulated guideline as a percentage? Again, agent recommends the absolute lowest ie 5% of property value.

Someone told is a guide is 8 to 10 and agent should have guided?

 

[Dolby]

I see the occupational rent negotiation should start at 1% of purchase price. So she sold at R950k... Rent should be R9.5k or so.

But agent convinced her to go at R5k.

Eish

 

[RedViking]

Sounds like she comes with a lot of issues. Get another girlfriend.

 

[gregmcc]

If the transfer haven't gone through there is no ways they can start doing anything yet.

Next thing the sale falls through and you end up with half a tiled floor.

 

[SauRoNZA]

Little bit late to worry about occupational rent now, that was stipulated in the OTP already and obviously accepted if they are moving in already.

But yes they can’t do anything until transfer is done. Even insurance is still her problem to cover until they are the owners.

 

[dlevine]

I see the occupational rent negotiation should start at 1% of purchase price. So she sold at R950k... Rent should be R9.5k or so.

But agent convinced her to go at R5k.

Eish

That occupational rent amount seems very fair. Was 1 percent years ago when prime was through the roof. With prime being so low now 5 percent is very fair....

 

[RonSwanson]

If the transfer haven't gone through there is no ways they can start doing anything yet.

Next thing the sale falls through and you end up with half a tiled floor.

...tiled with linoleum.

 

[RonSwanson]

My girlfriend is selling her property after a long battle with a squatter etc. The buying process doesn't seem to be going smoothly as well and as a first time seller, she's listening and taking advice from the agent.

For one, transfer hasn't gone through yet (ETA June) - but agent is saying that new buyer can already come in and start tiling etc. Surely this was wrong advice?

Also, regarding occupational rent, is there a stipulated guideline as a percentage? Again, agent recommends the absolute lowest ie 5% of property value.

Someone told is a guide is 8 to 10 and agent should have guided?

It depends on the OTP. Surely there is a clause (the standard Hortors one has it) that any and all changes or improvements need to have the consent of the seller? That's why I don't trust agents' OTPs, I use my own or amend them, frequently.

Regarding occupational rent, it is an agreed amount, but I always try to make it far higher than a reasonable bond payment and include levies / rate & taxes / water and insurance in my calculation. Point is that there needs to be a noticeable, distinct but reasonable difference between the two in favour of the seller, otherwise there is no incentive for the purchaser to conclude the deal swiftly, plus they have possession. It's not a panacea (I have heard horror stories) but usually works out well that way.
Naturally the agent wants their commission and will bend whichever way is the swiftest to their goal.