WHAT DO ALL THE LAWYERS DO?

Many banks will grant 100% loans but it is a good idea to pay a deposit.

Property experts answer your questions about the ins and outs of buying property, why so many legal professionals are needed and why you should try to pay a deposit on a home

Q: WHAT EXACTLY do transferring and conveyancing attorneys do? And what process should I, as a seller, expect once a sales agreement has been reached?

A: Many are unaware the change of ownership of the property does not happen when the offer to purchase is signed or even when the purchase price is paid to the seller. A property being sold will go through the conveyancing process and a new title deed will be issued in the name of the new owner, removing the property from the seller’s name. Three different attorneys handle various parts of the deal, namely, the registering attorney, the cancellation attorney and the transferring attorney. The transferring attorney is appointed by the sellers and represents them, keeping the seller updated with progress. Once the offer to purchase is signed, and all the relevant documents are ready, the transferring attorney will lodge them with the Deeds Office. This attorney will be in contact with the sellers’ bank and tell the sellers once their bond has been settled and cancelled. It is then the conveyancing attorney’s job to do everything in their power to expedite the registration of the property, bearing in mind they are heavily dependent on several external parties, such as banks, and municipalities. Once everything has been concluded, and the home has been successfully registered, the attorney will account to the seller for any fees that relate to the transaction. Sellers can expect to receive this account within two days of the property’s date of registration. – Adrian Goslett, chief executive of Re/Max of Southern Africa

Q: We are looking to buy our first home and are being told by so many people that we should buy in an estate. What are the benefits of this and are estate homes worth the higher price tags?

A: There are many benefits of estate homes. One of the major perks of estate living is that the body corporate usually handles maintenance with regards to roads, gardens and overall landscaping. Maintenance inside your property boundaries can also be taken care of with minimal fuss. The body corporate usually has a list of preferred suppliers who not only meet the level of workmanship required, but who are also able to work within the style guidelines of the estate. Security estates are also going above and beyond to ensure that they provide as many amenities as possible to residents. Estates boast everything from tennis courts to laundromats, pools and even walking trails. All of this is maintained by the body corporate, so you never have to worry about the pool being green or the park turning into a health hazard for the children. Security estates come standard with features such as 24-hour security, including electric fencing, cameras that provide thermal imaging at night, guarded entrance booms, as well as guards that patrol the estate. Many, if not all, gated communities, have the benefit of access control, security patrols and properly maintained walls and fences. – Mike Greeff, chief executive of Greeff Christie’s International Real Estate

Q: Have the values of coastal properties been impacted at all by Covid-19 and the lockdown? Are these homes still at an advantage, when it comes to their values and appeal, compared to inland properties?

A: As the tourism hub of South Africa, the Western Cape has been hard hit by the Covid-19 lockdown. With no international travel permitted, properties in sought-after areas such as Camps Bay and the Atlantic seaboard are now listed at a steal. Unsurprisingly, coastal areas such as Cape Town, Port Elizabeth and KZN are outperforming Gauteng in terms of sales, with majority of home loan applications received for properties between of R750 000 to R2 million, according to home loan aggregator, Ooba. There is also a load of Airbnb units now up for sale. In comparison to our business hub, Gauteng, properties in the Cape Town CBD and Atlantic seaboard average R20 000 more per m² and would usually welcome foreigners and corporate travellers throughout the year. – Grant Smee, managing director of Only Realty

Q: Is a deposit absolutely necessary when buying a home? And, if I can buy without a deposit, is this a good idea?

A: It is still possible for a bank to grant clients a 100% home loan, which does not require a deposit, but we strongly encourage first-time home buyers to consider putting down a deposit of at least 10% of the value of the property to ensure that their home loan repayments are reduced and more manageable. A deposit also demonstrates that clients have the financial means to make the purchase and are comfortable in taking on some level of risk until the deal closes. It’s an excellent way to further prove that you are ready to take on the costs and responsibilities that come with home ownership. Paying a deposit will improve your chances of having your home loan application approved and will place you in a better position to negotiate more favourable terms. The benefit is that you will be seen as providing equity into the deal, thus reducing the bond amount required. Putting down a deposit will also place the client in a better position to negotiate a more favourable interest rate which will further reduce the interest rate and monthly instalments, allowing you to repay before the term completes.

In addition, saving for a deposit is a great practice run for the commitment that will be required to ensure that you have the required funds and mindset to fulfil the obligations of monthly repayments in the long term. – Mfundo Mabaso, FNB Home Finance growth head