Calculate the financial implications of selling your home
The correct certification
If your home is fitted with an electrical system, an electric fence, and gas appliances, the compliance certificates for the validity of these installations are required before the successful transaction of your home. Depending on where your home is located, additional beetle and plumbing compliance certificates may be required.
• Electrical Certificate: Also known as ECOC, this certificate is valid for a period of two years, and only in respect of one transaction, according to current legislation.
• Electrical Fence System Compliance Certificate: This is a requirement if you have installed electrical fencing as a security measure.
• Gas Certificate: This requirement confirms that the gas lines are safe and indicates that the installation has been done by a qualified technician.
• Beetle (entomological) Certificate: Pertinent to homeowners in the Western Cape, this certificate indicates that the property is free from beetle infestations.
• Plumbing Certificate: This confirms that the plumbing on the property is sound and the requirement is applicable to property in the City of Cape Town.
Choosing to sell with an agent
While it is possible to sell the home privately and independently, the advantage of using an estate agent is that they know the market well. Estate agents charge commission on the sale of any property, and it is usually expressed as a percentage of the purchase price.
The cost of administering information is one of the most delicate parts of property transactions. Because of this delicate nature, this can be quite costly.
• When cancelling your bond, a cancellation cost is charged.
• If your bond repayment is within two to three years of purchasing the property, you bank may charge you an early settlement penalty fee.
• Most banks require 90 days’ written notice that you will be repaying the bond, and this requires a notice period penalty to be paid.
• For a successful transfer process, it takes about two and a half to three months from the date that the offer to purchase is accepted by you, to the registration of the property into the buyer’s name.
Rates, taxes and levies clearance certificate
Attorneys will require a rates and taxes clearance certificate from the local council, which you as the seller will need to pay for.
In the instance where you live in an estate or sectional title property, the homeowners’ association or body corporate may request that you pay for their levies a few months in advance.
Property Capital Gains Tax
Capital Gains Tax (CGT), which is payable by you, the seller, refers to the tax applied by SARS to a capital gain.
Getting things moving
The moving costs that must be considered here are how the move from point A to B will be made and whether insurance will be required.
This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your adviser for specific and detailed advice. Errors and omissions excepted (E&OE).