Property transactions in South Africa are often complex and lengthy, with delays that can lead to frustration, financial setbacks, or even jeopardize the deal. However, with proper planning and informed decisions, many of these delays can be predicted and avoided. Here’s what to watch out for and how to reduce the risk of delays during the transfer process.

1. Types of Delays

Property transfer delays generally fall into two categories:

• Pre-sale delays:
  These occur during the negotiation and confirmation of the sale.
• Post-sale delays:
  These happen after the sale has been confirmed and the transfer process begins.

Understanding where delays are most likely to occur helps you plan for and avoid them.

2. Bond Approval and Cancellation

One of the most common causes of delay is the bond approval process. Buyers may face issues if they don’t have all their documentation in order or if their financial situation isn’t clear. For example, self-employed buyers often face stricter requirements from banks, which can slow down the approval process. To avoid this, prequalification by a bond originator is essential.

On the seller’s side, not giving the required 90 days’ notice for bond cancellation can cause serious delays. Sellers should notify their bank of the potential sale as early as possible. This notification can be renewed or revoked, if necessary, without committing the seller to proceed with the sale.

3. Rates Clearance Certificate (RCC)

Before a property can be transferred, a Rates Clearance Certificate (RCC) must be obtained from the local municipality. This certificate ensures that all outstanding municipal rates and taxes are settled. The process involves requesting rates clearance figures, which include any arrears and a pre-payment covering the next 60 days.

It is the seller’s responsibility to pay these amounts through the conveyancer. This ensures that payments are properly linked to the transfer application and expedites the process. Failure to settle these payments on time will delay the transfer.

4. Compliance Certificates

Several compliance certificates are legally required for the sale of property in South Africa, such as electrical, gas, and water installation certificates. Delays can arise if these certificates are not obtained or if the property does not meet the necessary standards. Sellers should proactively arrange for inspections and repairs to ensure compliance.

5. Issues with the Deeds Office

Once all documents are submitted, the transfer process moves to the Deeds Office. However, issues can arise at this stage, particularly if there are errors in the lodged documents or the registrar requires additional information. Transfers that are more complex, such as estate transfers, may require endorsements from the Master of the High Court, further delaying the process.

6. Transfers Involving Linked Sales

When a sale is dependent on the proceeds from another transaction, timelines can become out of sync. For instance, if a buyer needs the funds from selling their current home to purchase a new one, delays in one sale can cascade into the other. Buyers should ensure they have the financial flexibility to manage such scenarios, such as an access bond on their current home to cover costs temporarily.

7. How to Avoid Property Transfer Delays

While some delays may be unavoidable, there are several steps both buyers and sellers can take to reduce the likelihood of transfer holdups:

• Prequalification:
  Buyers should be prequalified for a bond to avoid unexpected financing issues. Sellers should notify the bank early about bond cancellation.
• Timely Documentation:
  Submit all necessary documents promptly, especially if either party is difficult to contact or resides outside South Africa.
• Appoint a Qualified Conveyancer:
  An experienced conveyancer will coordinate with the bank, municipality, and Deeds Office to ensure a smooth transfer process. It’s advantageous if the agent and conveyancer have a good working relationship.
• Transparency with Your Agent:
  Be upfront about your financial situation to avoid last-minute surprises. Your agent can guide you through potential pitfalls and help you avoid costly delays.
• Obtain Compliance Certificates Early:
  Sellers should schedule inspections for compliance certificates early in the process to allow time for any necessary repairs.

Conclusion

Delays in property transfers are common in South Africa, but with proper planning and by working closely with an experienced estate agent and conveyancing attorney, many of these delays can be avoided. Being proactive, transparent, and organized throughout the process will help ensure a smoother and quicker property transaction.

By taking these steps, both buyers and sellers can avoid the costly consequences of unnecessary delays and enjoy a stress-free transfer process.