What costs should South African home buyers budget for besides the purchase price?
General South African property-buyer literacy only. This page is not legal, financial, tax, valuation, investment, property-condition or contract-interpretation advice, and it is not advice about your particular situation.
The purchase price is the number everyone discusses. It is not the number you need. Buyers are most often caught out not by the price but by the costs that arrive alongside it, and by the ongoing costs that begin the day the property is registered in their name. This page lists the categories to ask about. It deliberately gives no figures: amounts depend on the property, the municipality, the lender and the year, and a number that is wrong is worse than no number.
How much transfer duty is payable, or is this transaction zero-rated?
Transfer duty is a tax on the transfer of property, payable to SARS. Whether it applies, and how much, depends on the price and on whether the seller is registered for VAT — in some transactions VAT applies instead of transfer duty, and the two are not the same thing.
- What confirms it:
- SARS publishes the transfer duty tables, and they change. Your conveyancer calculates the amount for your specific transaction.
- Who to ask:
- A conveyancing attorney (the transferring attorney handles the transfer; you may also appoint your own).
- What Nostoi cannot decide:
- Nostoi cannot calculate your transfer duty or tell you whether VAT applies instead. Both depend on facts about the seller and the transaction.
What are the conveyancing fees, and who appoints the conveyancer?
The seller conventionally nominates the transferring attorney in South Africa, but the buyer conventionally pays the transfer costs. Buyers frequently assume this is negotiable and discover late that it is not, or the reverse.
- What confirms it:
- A written quotation from the appointed conveyancing firm, itemised.
- Who to ask:
- A conveyancing attorney (the transferring attorney handles the transfer; you may also appoint your own).
- What Nostoi cannot decide:
- Nostoi cannot tell you what a reasonable fee is for your transaction, or negotiate it.
If I am taking a bond, what are the bond registration and initiation costs?
Registering a mortgage bond is a separate legal process from transferring the property, with its own attorney and its own costs. Buyers commonly budget for one and not the other.
- What confirms it:
- The bond attorney's quotation, and your lender's written offer, which sets out initiation and ongoing fees.
- Who to ask:
- Your bank or bond originator, and the bond attorney the bank appoints.
- What Nostoi cannot decide:
- Nostoi cannot tell you what you will be offered or on what terms. That is the lender's assessment of you.
What are the municipal rates on this property, and how are they calculated?
Rates are an ongoing municipal charge based on the municipality's valuation of the property, not on what you paid. They continue for as long as you own it.
- What confirms it:
- A recent municipal account for the property, and the municipality's current valuation roll.
- Who to ask:
- The local municipality; the seller or agent can usually supply a recent account.
- What Nostoi cannot decide:
- Nostoi cannot predict future rates or tell you whether a municipal valuation is correct. Objecting to a valuation is a formal municipal process.
Is there a levy — and if so, what does it cover and what is its history?
In a sectional title scheme or an estate with a homeowners' association, the levy is a compulsory ongoing cost. What it covers varies enormously between schemes, and so does whether it has been enough.
- What confirms it:
- The scheme's most recent audited financial statements, its approved budget, and the levy history. A special levy raised in the past is a fact about the scheme worth knowing.
- Who to ask:
- The managing agent or the trustees, via the seller or agent; a conveyancer for what the documents oblige you to.
- What Nostoi cannot decide:
- Nostoi cannot tell you whether a levy is adequate, whether a special levy is coming, or what a scheme's financial statements mean.
Which compliance certificates are required, and who pays for them?
South African transfers commonly require certificates — electrical, and depending on the property and municipality, others such as gas, electric fence, plumbing or beetle. Obtaining them can reveal work that must be done before transfer.
- What confirms it:
- The sale agreement states which certificates are required and who bears the cost. The certificates themselves are issued by registered inspectors.
- Who to ask:
- A conveyancing attorney (the transferring attorney handles the transfer; you may also appoint your own).
- What Nostoi cannot decide:
- Nostoi cannot tell you what a certificate will find, what remedial work will cost, or what your agreement obliges either party to pay.
What will it cost to insure, and is cover compulsory?
A lender will normally require the building to be insured. In a sectional title scheme the body corporate typically insures the building collectively, which changes what you personally need — a difference buyers often miss.
- What confirms it:
- Your lender's written requirements; in a scheme, the body corporate's insurance policy and schedule.
- Who to ask:
- Your lender, an insurer or broker, and for a scheme the managing agent.
- What Nostoi cannot decide:
- Nostoi cannot advise on insurance products or tell you what cover you need — that is regulated financial advice.
What are the moving and immediate occupation costs, including occupational rent?
If you take occupation before transfer registers, you will usually pay occupational rent to the seller. Transfer dates move, and this cost can run longer than expected.
- What confirms it:
- The sale agreement sets the occupational rent and the terms on which it becomes payable.
- Who to ask:
- A conveyancing attorney (the transferring attorney handles the transfer; you may also appoint your own).
- What Nostoi cannot decide:
- Nostoi cannot predict when transfer will register. Deeds Office timelines vary and depend on matters outside anyone's control.
What this page cannot tell you
- Nostoi gives no actual amounts here — this page names categories only, because figures depend on the property, municipality, lender and year.
- Nostoi cannot tell you whether you can afford a particular home; that is your finances and a lender's assessment.
- Nostoi cannot tell you what a specific sale agreement obliges you to pay; only reading it with a conveyancer answers that.
Primary sources
- South African Revenue Service (SARS) — Publishes the current transfer duty tables and the rules on when VAT applies instead of transfer duty.
- Deeds Registries Act 47 of 1937 — Governs registration of transfer in the Deeds Office.
- Sectional Titles Schemes Management Act 8 of 2011 (STSMA) — Governs levies, budgets and the reserve fund in sectional title schemes.
- Local Government: Municipal Property Rates Act 6 of 2004 — Governs how municipalities value property and levy rates.