 Good evening and welcome to episode 383 of the Private Property Podcast. I'm your host, was a Mandonga Comando. It's a Friday edition of the Private Property Podcast. If you join us for the first time, welcome to the family. You tune into the only daily property podcast in South Africa, helping you on your property needs. And all our regular viewers on Facebook, on Twitter, Instagram, as well as on YouTube, welcome to it. You know how we do every single weekday. You and I have an appointment at 7 p.m. We're always in conversation with property experts who help us navigate our property journey. And it doesn't matter where you are along your journey, we're certainly here to help your aunt and to make sure that you make the best informed decisions. And talking about the best informed decisions, you also know that we've got other great shows that you can decide to tune into every single weekday at 8 p.m. right here across private properties, social media pages. As it is a Friday, you can catch Chad on their home shoppers show where he's on your screens on Mondays at the same time and takes you through exquisite properties that you can find on www.privateproperty.co.za. And it Tuesdays and Thursdays, Mbalino, takes you through the farming podcast tackling all things agriculture. And every Wednesdays, Estee Cranston brings you the first-time homebuyer show, which is always in conversation with people who've not only walked that first-time homebuyer journey and gone on to grow their property portfolios from strength to strength. Well, those are great shows that you can look forward to every single weekday right here on the private property, private property social media pages, rather. And of course, there's my samples I don't want to come out every single weekday at 7 p.m. You and I certainly are together. And I want to see who's watching us and why I dropped those green hearts down here below, regardless of where you're watching us. And of course, if you're watching us on Facebook, one of the great things to note with Facebook is that we're running a great competition where you at home stand a chance of walking away with 500 rounds in cash every single evening. And all you have to do is to make sure that you comment on the pinned post or on Facebook page where you share with that some of the great property and science advice that you've picked up while watching the show. And you have to make sure you're watching us live because if you call your name, you have to drop us a text in order to claim your prize. If the winner doesn't claim their prize, the money rolls over into the money bag. That's exactly what's been happening for the past two evenings. We've now got 1,500 rounds in the money bag. I hope whoever wins this money is watching us this evening and can end off the weekend on a high. Well, those are some of the great things that you can look forward to right here on the private property podcast with myself. Let's get started our conversation this evening. This one is the one that we have very regularly because we know that not a lot of people understand this process. A lot of people still have firm grasp of what to expect when it comes to the conveying journey. And this evening we're going to be looking at the basic principles of the conveying process and also just looking at some key terms that you always need to be aware of. And even things that could potentially make the transaction take longer than it should that you should be aware of from the get go. And to help us get a good sense of how we can do this we're joined by Alison Wright from DDT Attorney. And it's a good evening and thank you so much for joining us this evening. Thank you so much. It's a pleasure to be here. And it's such a pleasure to have you with us on the show Alison. I think let's start with you know convincing. When we talk about convincing what are we talking about? I mean so many people who start the property journey typically don't know about a convencer. Sometimes you know that there's an attorney who's going to be involved in the property transaction but you're still not quite sure how it's going to unfold. So when you talk about convincing what exactly is it that we're referring to? Well conveying is a field of law dealing with all things property. But more specifically it is the registration and the execution of a number of property transactions in the deeds office. And so when we look at conveyancing there are two pieces of legislation that deal with conveyancing that is the Deeds Registries Act and also sectional Titles Act along with a number of other legislative acts. But what it comes down to is there are certain transactions that are executed in the deeds office and conveyancing is the entire process that gives effect to that. So whether that is the transfer of property, bond cancellation, bond registration, servitudes, limited real rights, if you're looking at township establishments, registration of sectional title schemes. So it is a very specialized field of law that deals specifically with property transactions. So that's just a brief introduction to that. And I think the big thing to note there is if you're going to be dealing with any property transaction you're not going to be able to do it without a conveyance that involves. Because we've seen far too many instances where somebody says I'm selling my property or I'm selling the family home in a township and I'm just going to have an affidavit signed and give you my title deed. Unfortunately it doesn't work like that. You absolutely cannot eliminate a conveyance of being part of that transaction because there's certainly certain things that you and I at home won't be able to do in order for that property to exchange hands or exchange ownership from one party to another. And that's a really big thing that we need to take note of. And I can already see that we're getting some love on our Facebook page. Many of you are watching us and sending through those green hearts. Do you keep sending them? We've got Anelda Everton and we've also got a first-timer Tony Melman saying hello my first time here. Welcome to the family Tony. I'm sure you're going to be very very comfortable. I think all of us at home are certainly give Tony some love. That private property love. You know he must feel the love because you know that we absolutely love making the so-called bigger right here on the show. And now Anelda, when we look at then the role that a conveyance plays in a property transaction at which point is somebody who is either buying a property or selling a property approaching a conveyance because I'm sure some people at home may be confused about okay I know that this is an important part of this puzzle called home ownership but at which point exactly is a conveyance and then getting involved if you're looking to buy a property or if you're looking to sell a property. Okay so I wanted to touch on something you said earlier. I think it's so good that you are just warning people about the pitfalls of dealing with this process on its own. Previously I mentioned the legislation that's applicable to the conveyancing process and in terms of that legislation a conveyance is is the authorized and qualified party that can execute these property transactions in the deeds office and any transaction executed without that will ultimately leave purchases vulnerable and unprotected. So I really do want to encourage people that if you are entering into these type of transactions to make sure that you are using the right avenues as to how you would approach a conveyance. So usually when you sell a property or when you purchase a property there's an offer to purchase to be signed meaning that the parties enter into an agreement and standard terms of those agreements unless agreed otherwise between the parties is that the seller is entitled to appoint the conveyance so the seller will decide this is the conveyancing firm that I want to work with or the conveyance that I want to work with and that I want to have this process with and to have a transfer registered in the end. So that's ultimately how you would get them. Many estate agents do have certain law firms that they are closely associated with so that might also be an avenue to to get in contact with the conveyance but ultimately once that offer to purchase is signed the instruction is given to and conveyance to deal with the matter. And I want us to look at the offer to purchase Alison because I think you know all TPs are synonymous with sometimes having a few issues it becomes a very intimidating contract especially for the plier with many of them is the first time that you're assigning you know contract of that nature some of them thinking they can pull out at any stage and we've had this you know conversation before just warning people at home that by the time you signed up OTP it's a legally binding document so you need to be aware of. I think if you can just share with us perhaps some of the mistakes buyers in particular make when it comes to the offer to purchase and when they sign the offer to purchase that they often realize retrospectively things that they were not aware of and obviously by then they would have signed the contract it's already legally binding and some instances you're able to have a conversation with you know the estate agent to speak to the seller but in other instances they may not be you know as understanding to make those particular amendments. I would definitely like you said encourage purchases and sellers alike to really take the time and go through an offer to purchase it shouldn't be something extremely complicated a party should be able to go through that offer to purchase and understand oh okay what is the effect that it's going to have on me and if they don't understand something I really do encourage them to make sure that they ask the right people and find out exactly what the consequences would be of that because definitely one of the most important things to consider is the enforceability of that contract the moment the parties agree that is the moment it's legally binding and you and that contract can then be enforced so and of course there are legal consequences to that so that's very important so I think just briefly taking maybe a step back when you decide to purchase a property that's of course a process you need to embark on on your only need to decide what is my budget what loan approval I might be suitable for what am I looking for on the property and then once you find a property it's a back and forth between the asking price of the seller and what the purchaser is willing to to pay and and once the parties have gone back and forth and really reached an agreement and that agreement is signed then of course it's binding but I want to encourage people that before that point things to consider is definitely financially what are the implications for me what is the greater costs of this and then also looking at that property a standard term in in offers to purchase is a foots to its clause which means that the property is sold as is with its latent and patent defects you are indemnifying the seller against any claims for any damages with regards to the property because it is your responsibility as the purchaser to make sure that you go through the property that you identify any problems that they might be and it might also be a good idea to appoint a building inspector to help you consider more specialized fields of the of the building let's say structural defects or water damage or any of those types of risks and it is important to know that yes there are exceptions definitely from the seller's point of view if the seller is deliberately concealing certain defects in with regards to the property with the intention to defraud the purchaser that is obviously a red flag and the purchaser will have recourse in that regard but I would also then just encourage sellers to protect themselves by really being transparent in this process to say that listen this is the purchase price for the property and with that yes there are these certain problems that you need to take notes of and to be transparent in that regard to protect themselves against future claims and to protect themselves against certain future disputes so definitely from both party sides transparency is good and and really just doing your homework to find out what what is what it is you are actually purchasing so that's just a few of the things yeah I am this evening in conversation with Alistair and Rytoos from VDT attorneys and we're looking at the basic principles of the convincing process and of course joining us I want to find out from you at home your process when it comes to dealing with conveyances when you are you know when you are buying your property or selling your property what is it a pleasant experience I know that some of us sometimes have not so great experiences with some of the attorneys that we've dealt with but some of us would actually have really good experience I've I've taken a stance you know there's a firm that I use feeling rigidity with a lot of my transactions and sometimes you want that you know once you get used to a particular firm that's a firm that you kind of becomes your firm of choice when it comes to property matters I want to go for a quick break to find out who the lucky winner of that 1500 grand that is in the money bag and when we come back we're going to be looking at some of the key terms and concepts that both buyers and sellers need to be aware of as Alistair has already touched on one the footshoots clause and we've touched on this you know on a number of different occasions and it always is one of those things that will keep going back because we need to be aware of what it means and the limitations and that it of course has but in the meantime let's take a look at who the lucky winner of that 1500 grand is and that lucky winner this evening is John Ishmael John Ishmael congratulations to you you walk away with 1500 grand right here on the private property podcast with my son for some of them I hope you're watching drop us a message down here below to claim your prize and of course if John doesn't claim his prize then we're going to have a roll over into Monday where 2000 rounds will be up for grabs but for now a thousand 500 rounds is up for grabs let's see if John is going to claim that money before the end of the show and continuing our conversation as we're looking at the basic principles of the convincing process Alison when we look at you know what are some of the key terms that both buyers and sellers should be aware of especially even as we sort of look through the offer to purchase and because they're really going to be key terms that you always need to be aware of one of them you've really touched on is the food students course perhaps because through a few others that we always have to be mindful of as we're going through that offer to purchase and you know signing it that we are aware that these are certain parts they're almost the the signaling parts where this is important take note of this part in an offer to purchase well I would definitely say in an offer to purchase both the seller and the purchaser need to take note of those terms that really place obligations on them so for the purchaser the purchaser will look at how is the financial aspect of this transaction structured they need to be wary of the deposit that they will be required to pay in advance to secure the property they would also need to be aware of how are they going to to secure the purchase price of the property are they going to do it cash needs but it is a cash transaction what guarantees are they able to give with regards to the purchase price alternatively if they are going to secure it by means of a loan they need to keep in mind that there is a requirement on them to obtain loan approval within a specific time for in a specific amount and that is usually a suspense of condition of a contract meaning that if the purchasing thing fails to obtain that loan approval within the time specified the agreement we will become null and void so that is for example something that the purchasers should look at whereas the seller on the other hand might also have certain obligations with regards to the contract such as making sure that the electrical compliance certificate is in place and that the gas compliance certificate is in place another thing that the seller should be should note is just to be realistic with regards to the timelines of this contract one specific example is if this offer to purchase is subject to sale so if the purchaser has an existing property that they first need to sell before they can purchase this new property that is something that can really delay the process for the seller and something that they need to be aware of and realistic about because really the process is then a double transaction that needs to take place and everything needs to happen on two fronts so definitely something that can can delay the process for the seller so that's also something I would suggest they just keep in mind to look at. We're taking your questions and comments this evening on the private property podcast with myself as Amandonga Kumalo as we look at the basic principles of the convincing process we've got Umensi Bouteles on Facebook asking can the issue of being rushed into signing a contract be seen as duress or undue influence and Alison this is when you know estate agents sometimes almost and I say almost even though I think as a purchaser you may feel like you were being pressured to sign but almost effectively pressuring somebody to sign is that something that can be you know viewed as duress or undue influence? Well I definitely think it's important to know your rights in terms of the Consumer Protection Act so parties entering into an offer to purchase are protected under the Consumer Protection Act and in terms of the act there is a cooling off period so if you feel that you were pressured into signing a contract for the purchase of property there is a period of five days that you can utilize to cancel that contract to say that you know what I feel like I thought about this a little bit I'm having buyers remorse I'd rather step back and and not and not go forward with it so on the one hand important to know what you're getting into and I encourage purchases not to be pressured into into transactions I do feel that is something we see a lot especially when that is state agencies there's a lot of competition and you know there's a lot of offers and you might lose this property you won't get a deal like this again I encourage you stay cool calm and collected and but know that the Consumer Protection Act can also protect you in that regard to say that while you have a cooling off period to just think about things so use those five days and listen I mean correct me if I'm wrong if I remember correctly the cooling off period isn't it for for properties I think it's under is a 250 000 so there's a there's a there's an amount where the cooling off period is you know applicable if I remember correctly because I think is it a standard cooling off period for all amounts or it is I know for instance for properties that are valued or put or going for under a quarter of a million then the cooling off period applies to be fair I'm not entirely sure you're asking me a trick question in my mind if the Consumer Protection Act applies then that cooling off period does also apply bearing in mind that the Consumer Protection Act protects natural persons not necessarily juristic persons with a turnover of more than 2 million rand um so to my knowledge I I'm I stand to be corrected that might be the case but not as far as I know at the moment as far as I know it is a standard term in a contract that's a good question yeah and we've got another one here coming through on YouTube uh TR2 Munya saying what are the documents you collect in order to submit to the Deeds Office for Registration love this question so I think as conveys as you do this one quite a bit so what are those documents that you ultimately have to have before you uh you know before you take uh you know them obviously to the Deeds Office for Registration okay well there's um what we call certain documents in preparation for largements and then they are your documents that you lodge in the Deeds Office so firstly most importantly as with anything these days FICA documents are always applicable so those are documents that you're transferring attorneys and your bond attorneys will collect from you um as required by law so those are the first things secondly there are certain documents that need to be signed in preparation for for the transfer of the property one of the most important being the power of attorney where the seller authorizes the conveyancer to act on their behalf um to lodge the the matter in the Deeds Office but if we are looking technically at what documents are we lodging in the Deeds Office not necessarily other documents important for the process um those documents will be that power of attorney that we spoke about where the seller is authorizing the conveyancer to act on their behalf to appear before the registrar deeds to transfer the property um then also in order to do this any um property transaction you will have a deed that is your deed of transfer or your title deed so you will have an existing title deed which protects your rights with regards to the property saying you are the owner of this property that existing title deed will be included then you will have your deed of transfer that will become your new title deed so that is the document that we will be using to say that this property belonging to A is now being transferred to B for this amount so that's your third documents fourth is your rates and taxes clearance certificates so we are required to apply to the municipality in the area for a rates and taxes certificate so we get clearance figures the seller will pay three months rates and taxes in advance and once they do that the municipality will issue a clearance certificate which we are required to lodge in the Deeds Office and then the final document will be a um a transfer duty um declaration to say that transfer duty has been paid on this property alternatively a transfer duty exemption certificate to say that transfer duty is not payable so those are your general documents of course if you have more specialized transactions then then those will also be applicable um it is necessary to say at this point that those are just the documents necessary for the transfer if you're registering a bond there are additional documents for that that we need to lodge so that will be the new bond to be registered as well as a power of attorney and then a bond to be cancelled we will have a consent to cancellation that also needs to be lodged so um like I said just some general documents but there can be more specialized documents depending on a case-to-case basis and going to more of your questions and comments this evening as we continue our conversation on the basic principles of the convincing process coming to our rescue there on Facebook Sarita saying yes the cooling off is for properties under 250,000 thank you there Sarita for confirming I'm going to say most people become too excited while viewing the while viewing and completing the offer to purchase then you need to give you a few days later they sober up and fortunately most of us sober up when it's too late and penalties apply and that's a big one penalties will apply so you want to make sure that you're not signing something that you may ultimately regret a question here coming through from Oroz and so on asking is it wise to purchase or put an offer to purchase without being physically there to make those necessary assessments I'm asking this with regards to people who are residents of the Republic of South Africa but are working abroad for an extended period of time so any tips for people you know South Africans working outside of the country looking to buy property before they sign that offer to purchase the best ways that they can effectively make sure that they're also protected and not you know buying a property that has issues that they obviously can't see physically to be fair I mean that risk is on them buying a property from overseas that is a risky thing to do so not something I would advise someone to do but of course there are parties that can assist you in this regard if you have a trusted family member or colleague someone you trust in South Africa to go and at least look at the property more specialized parties like a building inspector can be appointed to go have a look at that property and to compile a comprehensive report of sort of what what is the state of the property and what should you expect what are the shortcomings so there are definitely options but I think it's best to do that yourself just to to be safe but of course I understand it's not possible for everyone and I think when we then look at the convention process holistically perhaps just give us a timeframe of how long it typically takes I mean I've had a couple of matters in the past few weeks some have been very quick you know one wasn't as quick as as others and it was because of the nature of the application but just to give us the average you know time that we should almost budget from the moment that offer to purchase is signed right through when it's going to be up for prep and ready for lodging at the Deeds office well we look at a time frame of about five to eight weeks but that is of course generally speaking things that can possibly delay that is if we offer example dealing with estate transfers so property that are um that is transferred from a deceased estate will always take longer because the master's office needs to consent to that um like I said earlier if you were dealing with the property that specifically is subject to sale of an a foregoing property that will also delay the process also generally just important to keep in mind um if you are purchasing a property um from the plans of course if the building needs to be built first it has to be completed and sometimes that can take a year to get to that point even longer it just depends on the circumstances and then finally the the problems we find most is if there is a problem with the municipal account at the municipality for example just just something outstanding amounts or discrepancies or information I mean there are so many strange things that can happen and just the going back and forth and following up with with municipal departments that can really delay a matter so um generally five to eight weeks but like I said case it always depends on on the matter and Alison before we wrap up this evening you know any final tips for our views at home when it comes to them supposed to just best understanding the convenience process whether they're looking to buy or of course looking to sell that can best help them navigate or certainly walk the buying or the selling journey going forward. One of the things that we haven't really touched on and I know I think we're running out of time a little bit but um is really understanding the costs involved for both parties um if I can briefly just go over the um sellers must always keep in mind that there will be estate agents commission applicable of course if you are working with an estate agent so if you are looking at your purchase price just always be in mind that a cut of that purchase price will also go to an estate agent just to prepare yourself for that type of thing. I mentioned earlier sellers also need to keep in mind clearance figures that need to be paid to municipalities levies that need to be paid to body corporates if there are any compliance certificates that are required the seller will be responsible for for the cost of that for the purchaser many costs involved so it's important that that they understand that going into things I think that buyers remorse definitely kicks in the moment you see all those costs um and and so definitely just to touch on a few of them there is the transfer duty so the tax to be paid when it when a property is transferred from a seller to a purchaser unless the seller is registered for that then there's the deeds office fee for the registration of that transfer and then there's also just the conveyance thing the transfer attorneys fees for for that transfer if they are financing it by means of a bond there's also going to be bond registration fees applicable I don't think we have enough time but also just some costs that you need to take an account with bonds the initiation fee applicable to all bonds doesn't matter who you bank with that's a 6035 rent fee that is payable as well occupational rent if a property doesn't register before a certain date you might be required to move into that property and to pay occupational rent for for a certain period of time before it does in fact register so that's um just another example I just quickly want to think if I'm missing anything um just popping back to bonds many banks require you to take our property insurance which is another monthly yeah a monthly premium you need to think about and some banks even require you to have credit life insurance um life insurance that pays out to cover your debt should you die or disability or lose your job etc and that can also be a monthly premium that you didn't necessarily think about when you saw the property and fell in love with it so um I think my biggest tip would be consult with someone just to say listen outline the possible cost for me what am I looking at um and and keeping that in mind um when when you start this process I think that would really be my biggest tip um and just doing your research beforehand of what this process looks like to really manage your own expectations but also to give you that peace of mind in this process and to make it to make it a celebration because it is exciting it um I think it's a dream for many people it's a dream for myself as well um so just enjoy it but keep an open mind and just know what you're getting yourself into and it's just such an important draw I think those costs stack up um and of course with transfer duty if you're exempt if it's under a million but anything over that you know that you're going to pay so we have to budget for it you can use the calculator on the private property website uh to get a sense of how much the transfer duty would be if uh you're going to have to pay for it and all these associated costs uh they're different calculators on our website that you can use to get a good grasp of how much you're looking to spend I'm going to squeeze in this last question it's a great question coming through from uh Cedric Yonkers um and it actually touches on something that you mentioned earlier uh Allison and this question is in the sale of a property in a deceased state a section 42 to certificate from the masters of the High Court is required who is required to pay for that the seller or the buyer shoo that is an interesting question I'm trying to think usually your purchaser is is required to pay any transfer fees that is applicable like we like we just discussed so I would firstly I would say I would just consider whether they are really costs involved with that