Deeds office slowdown

Noteworthy delays have been experienced in the Deeds Office in the last while. These delays affect the duration and finalisation of transfers and we therefore wish to inform you of the following:

The current Deeds Office turnaround times are:

1. On Tuesday 2 July 2013, 1st level examiners examined deeds lodged on 25 and 26 June 2013.

2. On Tuesday 2 July 2013, 2nd level examiners examined deeds lodged on 12 and 13 June 2013.

3. This translates into a turnaround time of between 15-16 working days in the examination phase.

4. The reality is that a batch of three deeds, i.e. a basic transfer, bond cancellation and new bond, actually took 19 working days to come up for registration as at Monday, 8 July 2013.

5. The Deeds Office can be approached after 7 days to expedite the transfer if a rates clearance is about to expire and they will accept an extended rates clearance in these situations. This is very helpful for the transferring attorneys.

For further details herein or any assistance regarding your property affairs please contact Meyer De Waal (meyer@oostco.co.za) or Mark Witzmann (mark@oostco.co.za) on 021 461 0065.

 

Purchasers beware!

Purchasers are to be advised of the following monetary implications when they purchase a property:

1. Budget, Budget, Budget!! There are transfer costs and mortgage bond costs which will more than often be paid to different attorneys. The banks DO NOT advance the transfer duty, which is the biggest component of your transfer costs. Have your transfer duty monies available as it’s required at least one month before transfer.

2. The banks charge an Initiation Fee of approximately R 5 700.00 for your bond. You must add this onto your bond costs calculations. See http://www.avidfirefly.co.za/?attorneyCode=95105& for a calculation of the transfer and bond costs.

3. Please remember that occupation dates and transfer dates can be different. If you move in before registration of transfer of the property into your name you will have to pay occupational interest payable one month in advance to the transferring attorneys.

4. If you move in early, check on the insurance of the property. The Seller should insure the property up to registration of transfer and you as the Purchaser can be held liable for a pro rata contribution.

5. If you were to move in prior to the date of transfer, you are liable for a pro rata contribution of the rates and taxes as well, calculated from the date of occupation until the date of transfer. If these extra costs are to be avoided then insert in your offer to purchase: “possession and vacant occupation on registration of transfer”.

For further details herein or any assistance with the purchase of your property please contact Meyer De Waal (meyer@oostco.co.za) or Mark Witzmann (mark@oostco.co.za) on 021 461 0065.

 

Sellers take note

Sellers are to be advised of the following when they sell:

1. Remember to give your 90 day notice of intention to cancel your bond to your financial institution to avoid penalty interest being charged on your bond.

2. If you have an access facility on your bond and require funds, please remember to draw on those funds BEFORE giving your 90 day notice as financial institutions will freeze your access facility once the notice period is processed.

3. If your property is enclosed by an electric fence a compliance certificate from a registered electric fence system installer is now an additional requirement.

4. If the sale of your property is linked with the purchase of your new property please plan the registration of your transfers accordingly. Recently, a batch of three deeds lodged on 11 June 2013 only came up 19 days later on 8 July 2013. Deeds Office is far behind in the examination process.

5. E-filing season has commenced. Ensure that your tax returns are up to date as any outstanding returns from previous years will be picked up by SARS when they process the transfer duty application submitted by the transferring attorney. This may result in a delayed transfer.

For further details herein or any assistance with the sale of your property please contact Meyer De Waal (meyer@oostco.co.za) or Mark Witzmann (mark@oostco.co.za) at

021 461 0065.

 

Trusts and the sharpened focus on the administration thereof

Treasury and Finance Minister, Pravin Gordhan, have identified trusts as an area of risk from a legal and taxation perspective due to the improper manner in which many trusts are being administered (or not administered).

1. Although it is not fatal to have the founder of a trust acting as a trustee, it is vital that the founder transfers control and decision making powers in respect of the trust assets to the trust and not retain same. Ensure that the Trust Deed reflects this transfer of control clearly, otherwise SARS or creditors of the donor or trustees might question the validity of the trust. It is also essential that the trust has its own bank account, as this will aid in proving that the founder and trustees have been divested of control over the trust assets.

2. It is also important to appoint an independent trustee(s) to act together with the other trustees and to afford such a trustee with at least equal decision making powers as the rest of the trustees. This serves as an indication that the trust is not merely a smoke screen used by an individual who actually manages assets for and in his personal interests for e.g. tax avoidance purposes.

3. Ensure that the Letters of Authority or Master’s Certificate is updated, i.e. that all the trustees indicated thereon are current and alive. Should it not be up to date, it is very important to amend these records at the Master’s Office as this may affect the signing of documents on behalf of the trust, especially where the signatures of all trustees are required. If the trust deed requires that a specific number of trustees must be in office one must ensure that the correct number of trustees are “in office” to act as such.

4. Resolutions are a crucial element of trust administration as it keeps record of all the decisions made by the trustees on behalf of the trust. Without a signed resolution authorising a specific action, such action’s validity may be questioned (and in many cases invalid) depending on the trust deed’s content. It is also very important to ensure that resolutions are considered and passed (signed) timeously. E.g. should the trustees want a resolution to have an effect on financial year end, they must ensure that the resolution is passed prior to the specific year end, regardless of whether or not the financial statements and/or audit is ready by that time. This is especially important for tax purposes and in particular when moveable property is sold or purchased.

5. Treasury and Finance Minister, Pravin Gordhan, have identified trusts as an area of risk from a legal and taxation perspective due to the improper manner in which many trusts are being administered (or not administered). Far-reaching changes to the tax treatment of trusts have been proposed, but the implementation thereof has been delayed. They mentioned that a Discussion Paper might first be released prior to implementing the proposed changes. It is therefore the ideal time now to get your trust affairs in order so as to be ready and “cleaned up” for when the legislative changes are effected and SARS starts probing.

For more information or to schedule a consultation to discuss the above, please contact Meyer de Waal at 021 461 0065 or meyer@oostco.co.za

 

SUCCESSFUL LAUNCH OF THE CONSUMER HOUSING EDUCATION PROGRAMME

Home ownership is a failsafe method to assist aspirant first time home owners living especially in townships to escape the poverty trap. This is the message of MEC for Human Settlements, Minister Bongikhaya Madikizela at the launch of the Consumer Housing Education Programme in Khayelitsha last week.

Minister Madikizela referred to the difficult task of local government providing sufficient housing and related services particularly in the Western Cape area. The Western Cape currently has inflows of thousands of people migrating into the Western Cape region every month, which puts massive strain on local services. The WC Government main focus is to first provide the basic needs like water, sewerage and sanitation services before they can embark on a proper housing scheme for those living in shacks.

Minister Madikizela lauded the initiative by private companies and stakeholders in the property industry to get together stand together and develop a Consumer Property Education programme for first time buyers as well as sharing their skills and their resources. Currently, no housing education exists for first time buyers or new homeowners in the GAP market.

The attendees of the Khayelitsha forum were all hand-selected stakeholders from Local Government, City of Cape Town and other Municipalities, ward counsellors, NGO organizations, community leaders, banking and finance institutions, property developers, mortgage originators, and representatives in the corporate and private sector.

• Meyer de Waal, CEO of My Budget Fitness, introduced the Consumer Property Education programme for first time home buyers in “Six Easy Steps” to the stakeholders.

• Solly Molefe, Owner of Setsmol followed up and shared his experience on the importance of Consumer Property Education, flowing from his 11 years as educator and mentor in the Consumer Education environment.

• Gary Power, Marketing Manager of Power Developments focused on the importance of a property developer’s role of creating a community of new home owners. Through Consumer Property Education it can empower new homeowners with information to take action and for them to understand their rights and duties as a prospective property owner. Research done by Power Developments also highlighted the need for consumer education for homeowners.

• Daphne King, from the City of Cape Town welcomed the collaboration of role players in the private sector to work with Government and Local Authorities in partnership to expand the concept of consumer education for First Time Home Owners. The City of Cape Town has already implemented consumer education for the BNG type housing, but realised no such product exists for the Gap Housing segment of the market.

The contributors to the ‘Consumer Property Education’ programme for First Time Buyers are:

• Blue Oak www.blueoak.co.za
• Credit Health www.credithealth.co.za
• Law Property www.lawproperty.co.za/lawactive/
• Lightstone www.lightstone.co.za
• MoneySmart www.moneysmart.co.za
• My Budget Fitness www.budgetfitness.co.za
• Inspect-a-home www.inspectahome.co.za
• ICALL ASAP www.1callasap.co.za
• Real Estate Investor Magazine www.reimag.co.za
• Setsmol www.setsmol.co.za

The rollout of the first Consumer Education for first time buyer seminars and workshops will be held on the following dates:

• 26 June 2013 Mmbatho/Mafikeng – completed with great success
• 18 July 2013 Khayelitsha • 20 July 2013 Observatory
• 27 July 2013 George • August 2013 Blaauwberg
• August 2013 Langebaan

Pictures of the event can be viewed;

• on our website – under “press” – http://consumerhousingeducation.co.za/
• or on Facebook https://www.facebook.com/#!/ConsumerHousingEducation?fref=ts

For more information:

You are welcome to contact Meyer de Waal – meyer@budgetfitness.co.za to arrange for your own clients to receive an invitation to such seminars, or if required, to host a seminar under your exclusive “branding”.