Slow service delivery in the Deeds Office to impact on economy. Is this our local “9/12”

When you plan a property transaction, one of the last things on your mind is the return of your title deed after the registration in the deeds office. This can cost a property owner thousands of rands.

Our experience is that the local deeds office is one of the worst performers when it comes to the delivery of the title deeds after registration. This slow/bad service may cost the economy and a property owner as a property owner must now wait months to get a title deed out of the deeds office – as example when the property was sold again, or if a further mortgage bond must be registered.

We also cannot understand why the Deeds Office is so much in arrears, when the rest of the country appears to be must faster in their service deliver, in particular when it comes to the delivery of a title deed.

This problem is compounded by the frustration experienced by conveyancing attorneys, estate agents and members of the public when the deeds office in Cape Town announced late in December 2015 that they will close their offices for almost 3 weeks for a Christmas break – the result that many property transactions, worth millions of rands, could not be registered.

From the Deeds Office

We can advise as follows:

• As at end January 2016 our backlog total stood at ±50000.
• The Image Scanning section commenced with an action plan on 1 February 2016 whereby a renewed attempt was made to get all the backlog deeds scanned.

During February we scanned 46116 deeds that were then ready for verification on 1 March.

I can report that for the period 1 – 10 March we verified 17000 deeds and delivered 13900 deeds. We want to advise conveyancers that we anticipate that we will be delivering the 46000 deeds within the next 3 – 4 weeks.

We are requesting the cooperation of conveyancers:

1. To collect deliveries daily as we do not have the space to store deliveries
2. To deal with requests for expedited deliveries cautiously and only in very urgent matters as the expedited requests places an extra burden on the section. If we stick to our action plan, we project that we should be able to deliver deeds registered up to end December 2015 by end March 2016.

Errors and omissions excepted (E&OE)

 

Estate Agent focussed Workshop

Shirley Baillie and Meyer de Waal, both well-known on the sectional title environment and Government Subsidies to purchase a property will co-host a workshop focussed to provide information to practising estate agents.

Meyer will focus in how to boost and improve sales with access to Flip subsidies and Shirley on Sectional Title matters.

The workshops will be held on the following days:

• Mowbray 27/28 August
• Blouberg 1/2 September
• Somerset West – Middle September

Says Shirley

Agents selling Sectional Title need to be knowledgeable and familiar with the intricacies of the Sectional Titles Act, its Prescribed Rules, as well as the Conduct Rules of the individual Body Corporate, in order to minimise the risk of being held responsible, e.g., for creating the wrong impression by failing to correct a possible misapprehension on the part of a buyer in terms of the Consumer Protection Act (see below for the relevant clauses).

Since the CPA has been in existence for a couple of years, the public is becoming much more aware of their rights. Cases are starting to appear and lawyers are longing to make a name in this relatively new area of law. Estate Agents are “sitting ducks” for claims.

It is so easy for an Estate Agent to make a mistake if he/she is not aware of the possible pitfalls, or where to find information. As a result, deals get held up with the conveyancer or at the Deeds office frustrating the seller and buyer and doing damage to the Agent’s reputation and cash flow!

So having a sound working knowledge of the Sectional Titles Act is what is needed for Estate Agents who are serious about making a good living in this very fast growing section of property sales.

AN INTRODUCTION TO THE SECTIONAL TITLES ACT
TRAINING COURSE
especially for
ESTATE AGENTS WHO SELL SECTIONAL TITLE

This two- morning interactive, training course gives a good understanding of the Sectional Titles Act, introducing & explaining the clauses most relevant to sectional title sales. It makes sectional title understandable, offers many examples and is presented by Shirley Baillie who has been involved in Sectional Title, in many different capacities, for 30 years.
The cost per person is R1500 (no vat) bulk & early bird discounts available!

This will assist with:
• increasing your level of professionalism
• reducing your risk of falling short of the CPA
• minimising problems relating to transfers
• building up your credibility in the S T market
• empowering yourself
• increasing your confidence & understanding of ST complexities

The topics include:
• The background to Sectional Title
• What you own when invest in Sectional Title
• Comparisons between Home Owners and Sectional Title
• Plans & Title Deeds – the important of the information thereon
• The intricacies of Common Property including Exclusive use areas
• The functions and responsibilities of Key Role Players
• How do ST rules relate to tenants
• Managed versus self-managed complexes
• Key aspects of the finances
• Alterations, maintenance and use of sections
• The relevance of The Rules
• Insurance values versus market and municipal values
• Creating awareness of possible pitfalls relating to the CPA

ALSO INCLUDED IN THE PRESENTATION IS AN OVERVIEW ON FINANCIAL FITNESS, presented by lawyer and entrepreneur, Meyer de Waal, designer of the two innovative products Financial Fitness and Rent2Buy which assists people in achieving their dreams of owning property. .Meyer will be giving an insight and understanding of how to assist your customers in accessing the first time home owner’s subsidy which is available from the Government, Great for assisting sales!
All of the above will assist in making more sales possible for YOU – especially with Sectional Title being the prime source of entry into the property market for first time owners.
Learn more, have the tools to assist people to achieve their goals, and you can only increase your earning capacity!
For more information –  sbaillie@worldonline.co.za

 

Real Estate Investor Magazine / Rode Property Conference

As you know Meyer de Waal will be a special guest at the upcoming Real Estate Investor Magazine / Rode Property Conference to be held in Johannesburg in 19 August and Cape Town on 26 August 2015.

We have secured “5 specials” deals and if you book 3 tickets, you can get 2 for free.

» Contact Ray at our office to secure your special booking.

A snippet of what is to come:
Here are the links below to our interview on ‘Ask the Property Experts’ property broadcast on Business Day TV recently as a snippet of what is to come.

Ask the Property Experts	Looking at where South Africa is on the property clock, Kura Chihota talks to CEO of Rode and Associate, Erwin Rode and specialist property publication founder and Editor in Chief of the Real Estate Investor magazine, Neale Petersen.	view Part 1 »
		view Part 2 »

REAL ESTATE CONFERENCE: Thought Leaders in Real Estate Investment and Education
The annual Rode-REIM Real Estate Conference will again be jointly hosted by Rode and REIM this year and will take place in August in Durban, Johannesburg, Bloemfontein, Port Elizabeth, Cape Town and Windhoek. Whether you are a beginner or seasoned market participant, Rode and REIM bring together the latest world and SA trends, education and thought leadership on real estate and investment. The events are sponsored by Wealth Migrate.

Rode-REIM Real Estate Conference Events 2015

1. Durban – Half-day Conference – Gateway Hotel – 18 August – Click here for Bookings
2. Johannesburg – Full-day Conference – Emperors Palace – 19 August – Click here for Bookings
3. Bloemfontein– Half-day Conference – Ilanga Estate – 21 August – Click here for Bookings
4. Port Elizabeth– Half-day Conference – Radisson Blu Hotel – 25 August – Click here for Bookings
5. Cape Town– Full-day Conference – Spier Wine Estate – 26 August – Click here for Bookings
6. Windhoek– Half-day Conference – Hilton Hotel – 28 August – Click here for Bookings

 

YOUR INVITATION TO THE HOME OWNERS EDUCATION WORKSHOPS

Meyer de Waal, the convenor of the HOME OWNERSHIP EDUCATION TEAM says that they may consider to select A B de Villiers in their team – if he had the same specialist knowledge on home ownership education, if compared to his cricket skills.

To sign up for these exciting workshop – click here.

Even if you already own a property, it will be worth your time to come and listen to Neale Petersen and Vangile Makwakwa as they will inspire you to plan ahead how to make the money with gearing and using money of a bank and let a tenant work for you (help you pay off your bond) – once you are ready to start to buy a second property as an investment.

To the average cricket fan, the following names of the HOME OWNERSHIP EDUCATION TEAM would not mean a lot, but most of us in the property environment, would recognize the big stars, currently in top form, and we announce,  in no particular order our team: (a mix of fast bowlers, amazing spin bowlers and wizards with a bat)

• Verna Pugin
  • FLISP Expert and Home Ownership Educator

• Neale Petersen
  • Founding Editor and Publisher of Real Estate Investor Magazine, Publisher, Entrepreneur and Mentor

• Vangile Makwakwa
  • Author of “Heart, Mind & Money: Using Emotional Intelligence with Money”, Bus Sci Finance, (UCT) MBA, (Simmons School of Management), Financial Literacy speaker for the Sanlam Youth Segment, Part time Finance and Economics Facilitator, USB-ED (Stellenbosch B School and Founder of  Wealthy Money, Blogger, coach, writer and speaker on the link between personal finance and emotions.

• Cara Lippert
  • Debt restructuring expert

• Tony Collins
  • Professional Valuer, Lecturer, Author of An Introduction To Commercial Property Finance, Development And Investment , Part-Time Lecturing In Property Development And Investment

• Annette Evans
  • General manager for IEASA Western Cape Region and in charge of Training and Management of Propstats

• Mark Witzmann
  • Conveyancing expert, attorney & property lecturer

• Meyer de Waal
  • Attorney and conveyancer, property lecturer, developer of My Budget Fitness, Rent2buy, Mobile2budget, Consumer Housing Education and My Bond Fitness.

“Passion, experience and specialist knowledge in the Property Industry were the key aspects we recognized when we identified the role players in the HOME OWNERSHIP EDUCATION TEAM” says Meyer.

The first HOME OWNERSHIP EDUCATION WORKSHOP will be held in in Cape Town regions and will start on 18 April 2015.

The focus will be:

WORKSHOP – CONTENT

The workshop will be dedicated to First Time Home Buyers and you will get to know:

• How to go about to buy your own home
• How to get out of debt
• Make use and apply for the Government available subsidies
• Save thousands when you buy your own home
• How prepare yourself, your budget and your credit profile to apply for a home loan
• How to use our tools to manage your budget
• How to calculate the extra costs that you have to pay to buy a property – transfer costs, bond registration costs and bank administration costs
• How to do a due diligence on the house that you want to buy – before you buy
• And many more
  • If you attend the workshop, you will also receive extras to the value of R1 500.00
    • 6 module course – e guide – how to buy your own home
    • 10 % discount for your FLISP administration fee
    • Tool to create and manage your budget
    • Personalised Credit Report
    • Access to our latest software to check your actual purchase power, combined with your affordability
    • Subscription to the social media network of our expert panel
    • & once you bought your new home and taken transfer
    • Our 24 month Guide – The A – Z Guide – How to own your own home.

DEBT RESTRUCTURE & CREDIT PROFILE IMPROVEMENT – PERSONAL CONSULTATION

If debt restructure or credit profile improvement is required – we can arrange for individual & private consultations with our debt restructure experts.  We will provide you with a separate details and a an estimate of the costs once we have more information from you.

To sign up for these exciting events – click here.

For more information on the workshops and the background information on the “big stars” – click here.

 

FIRST TIME HOME BUYERS AND OWNERS ARE LOSING THOUSANDS

Many home buyers and current new home owners are unaware that first time home buyers may qualify for a housing subsidy under the FLISP grant.

“If they do not investigate and make use of the opportunity they may be losing thousands of rands by not claiming the FLISP subsidy, but also losing out on the prospect of reducing their bond repayment and bond term and as such losing out thousands more” says Verna Pugin who conducted an investigation into FLISP subsidies.

The word FLISP is an abbreviation for “Finance Linked Individual Subsidy Plan”, initiated by the Government to assist first time home owners in acquiring their own homes.  It is available to all first time residential home buyers who earn between R3 501 – R15 000 per month and whose home loan has been approved, (as a pre-requisite) as well as current first time new home owners (who have already taken transfer). Current new home owners must apply for the assistance within 12 months of taking ownership.

The minimum FLISP subsidy is R20 000.00 and if such subsidy is paid into a bond of R500 000.00 as a “once-off” payment, the home owners can save up to almost R100 000.00 and reduce his/her bond repayment from 20 years to almost 18 years, saving 2 years of bond repayments. Similarly, a subsidy of R40 000.00 awarded to a qualifying home owner with an income of R11 700.00 who may qualify for a home loan of R400 000.00, may save more than R170 000.00 on bond repayments, and reduce the bond repayment term from 20 years to 15 and a half years.

The maximum purchase price of R300 000 was removed since 1 April 2014, yet few existing home owners are aware of this opportunity to claim their FLISP subsidy.

The benefit to a bank will be that an additional payment into a bond account will also reduce the debt risk for a bank, as it reduces the loan to value ratio. ”We suggest that clients approach their banks to reconsider and reduce the interest rate that is applicable to a home loan once the FLISP subsidy is paid into their home loan account”, says Vern Pugin, who made an intensive study of government assistance over the past few years and she realised that home owners need to be assisted and informed about their rights to obtain FLISP subsidies. The research done by Verna led to hosting workshops with property developers, estate agents, home buyers and home owners as she realised the dire need therefor amongst all stakeholders in the property market.

FLISP subsidies are available to pre-qualified property developments and to obtain such approval, property developers need to submit their application in advance to the Department of Human Settlements.

The pre-approval of a home loan remains a barrier for many first time buyers, property developers, sellers and estate agents as they do not want the property transaction to be held up, due to the long waiting period to obtain a FLISP approval. Up to recently home buyers did not have access to the services like the software developed by My Bond Fitness to pre-check a buyer’s credit profile status and affordability in advance.

With the services provided by My Bond Fitness www.budgetfitness.co.za a buyer can obtain his affordability within a few minutes and as such he determine if he will be able to qualify for FLISP and then in advance prepare himself for the FLISP application.

The FLISP subsidy is however not limited to property developments only as this grant is available to the open market for all first time buyers as well. Any type of residential property can be bought, inter alia plot and plan except vacant, land, a new house, or a property with an existing houses on it, as long as the applicant has pre-qualified for a home loan when he or she submits their application for the FLISP subsidy. Applicants will have to meet the qualifying criteria which can be found on our website and will be advised by us as to which documentation is to be annexed in support of their application.

Verna realised that home ownership education will play a vital role in creating sustainable home ownership and teamed up with Meyer de Waal, who developed the My Bond Fitness as well as the Rent2Buy concept.

Home ownership education forms a vital part of the home ownership journey and Rent2buy process.

With Rent2buy, aspiring home owners will first rent the home they want to buy, should they not meet the strict requirements of a bank to qualify for their home they want to buy, and during the rental period, they secure the property with the Rent2Buy agreement, then have the time and opportunity to improve their credit rating and affordability and save towards a deposit to enhance their chances the next time they apply for a home loan, some 12- 18 months later. Verna says such opportunities will allow the processing a FLISP subsidy application much faster as by the end of the rent2buy period, all the required FLISP documentation will be ready and available for processing.

For more information – go to www.flisp.co.za

These two articles were featured in the recent Real Estate Investor Magazine Here is your link to the latest March 2015 issue of the Real Estate Investor Magazine.

 

FREE LEGAL ASSISTANCE

We have decided for a limited period to provide free legal assistance to the existing clients of our office – selling or buying property – and the free service to existing clients of our office will entail that you can fax or email us your sale agreement and Meyer de Waal meyer@oostco.co.za or Mark Witzmann mark@oostco.co.za will go through the agreement and provide you with our verbal comments for this sale agreement. Why do we offer this service for free? – it  saves us a lot of time afterwards, as we often receive sale agreements from estate agents, sellers or buyers that have been drawn so badly, that we spend hours afterwards to try to ‘fix” the mistakes

Read on more: https://oostcomeyerdewaal.wordpress.com/?p=717

 

Sellers: Are you safeguarded in the Deed of Sale you have just signed?

Over the past few weeks we have noticed some inferior deeds of sale come before of us. Once a Deed of Sale is signed which turns out to be problematic in the final execution and transfer process, it can be very difficult for the Conveyancing Attorney to do remedial work to save the transaction and hence ensure a smooth transition. This can results in a delay to transfer the property. It is very important for Sellers to obtain a legal opinion on the deed of sale, BEFORE, they sign the agreement and not to place 100% reliance on their Estate Agent. Sometimes the problems that arise are purely due to a lack of knowledge on the part of Seller coupled with a lack of knowledge or technical expertise on the part of an inexperienced agent.

FREE SERVICE –  BEFORE YOU SIGN

We are therefore offering our existing client sellers a FREE SERVICE. This free service entails the scrutinizing of the Offer to Purchase BEFORE you sign it to make it an agreement  that is binding on yourself. So what are the permutations that a Seller needs to know when the Offer is put under your nose?

Here is a list of some of the pitfalls to be wary about:

1. When do I get my money? 

On the whole this appears to be a relatively simple question. Upon registration of transfer of your property into the Purchaser’s name, the conveyancing attorney  will do the  final statements of account, send it to you and pay you out when the funds appear in our trust account. This payment can happen either on the day of transfer or the next day especially where guarantees are involved as issued by the Purchaser and his bank.

Seems simple on the face of it. – but how is that purchase price made up and where does it come from? This is where the Seller needs to be careful and aware of what he is signing.

Your purchase price is made up of (preferably) a deposit and a balance purchase price.

The deposit comes in soon after signature . Deposits are good, as it shows a sign of good faith and that the Buyer means business.

The Balance of the Purchase Price can get complicated.

If the estate agent tells you that the Purchaser is selling his property then you must be alert. This is where serious complications can arise and a possible delay in the registration of your property.

Has the Purchaser sold his property already?

If so, is that sale subject to a suspensive condition? If it is, by when will that suspensive condition be fulfilled? What does this mean in plain English? Your purchaser A may have sold his property to his Purchaser B who has sold his property to his Purchaser C all subject to bonds and/or further sales for example.

All these deals are financially linked to each other and are dependent on each other and impact directly on your sale and your money arriving on time.

It is no use that your estate agent tells you that the properties are sold and that everything is fine. Your agent must ascertain at what stage each and every sale is at. And most of the time other estate agents are involved.

Please contact us NOW if you are in a situation like this or as soon as you are so that we can ascertain the status of these linked deals and report back to you.

Just recently  we had a client that did not even realize the number of linked transactions below his. The client said,“ I did not even know about that transaction!!  What has that got to do with me?” The answer is EVERYTHING TO DO WITH YOU.

He was referring to the third sale after his and that sale was the sale that held up all the other linked transactions, all being financially interconnected. The Seller therefore received his money late.

2. What do I do in this type of situation? 

Our recommendation :

Ensure that there is a 72 hour clause/3 day clause written into your contract which allows you to receive a competing offer from another new buyer which has to then be presented to your first, original buyer. Your first buyer then has 72 hours or 3 days to either  comply with his suspensive conditions or waive them depending on how the contract is specifically worded. If not, then the competing offer wins the day and the first sale is null and void.

Contact us for the full and complete wording and DO NOT DELETE THIS CLAUSE – without checking out the consequences of such – Please do not allow for this clause to be deleted  as the  agent may be  protecting the  buyer.

This can arise particularly where there is NO sole mandate involved.

Why? Because the estate agent does not want competing offers fighting against his or her offer and on an open mandate this can occur. Another agent can bring a full asking price cash offer which you will definitely accept. Then the first agent potentially loses out as his or her buyer has 72 hours to waive the suspensive conditions and may not be able to do this. If the first buyer cannot do this it is goodbye to that buyer and hello to the full asking price cash buyer!!! First agent loses all commission, second agent gets all the commission.

So insert that 72 hour clause to protect your interests- the sale of your most valuable asset!!!

And phone us when that competing offer arrives. IMMEDIATELY. We shall ensure that it is properly submitted to your first buyer as stipulated in the first contract.

3. Sectional Title: Know what you own!! 

It is important for Sellers to understand what they own especially when it comes to exclusive use areas. If you cannot answer as to how you own your exclusive use areas and the agent is unsure, please contact us immediately. Exclusive use areas are not necessarily in all title deeds and could be owned in terms of the Sectional Title Rules. We shall advise YOU!!

If you do not know about a real right of extension registered over your Scheme do not expect the estate agent to know. PHONE US IMMEDIATELY.

A real right of extension allows a Developer or the Body Corporate to extend the Scheme either by the addition of further buildings, a horizontal extension or vertical extension to an existing building reserved for a period of time e.g. 25 years.

This real right of extension MUST BE DISCLOSED  in the Deed of Sale BY LAW. If not, the Purchaser can walk away from the transaction. It is best to ask us to investigate this on your behalf BEFORE the contract is signed. We already are doing this for some estate agents who do not have access to this information.

4. Alterations or Extensions to your Property. 

Please always do this in accordance with law by adhering to your title deed conditions and Council Regulations. Building Plans must be approved by the Council. Your architect will guide you.

If you are doing some kind of Sectional Title extension to your flat it is highly suggested that you contact us to ensure that this extension has been correctly registered. We have had a situation where this was not done, there was terrible technical misunderstanding of the issues at hand and the result of this was that the client had to lose a part of the sale proceeds by way of a retention of the purchase price- a substantial sum of money.

Again CONTACT US WHEN IN DOUBT.

 

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.

 

Sectional title searches prior to listing and selling.

We encounter many sectional transfers where the Seller and the Agent are unsure of the situation regarding exclusive use areas. Sectional title properties can be more complicated than conventional properties.

Exclusive Use Areas are not always shown on Deeds Office printouts and often agents do not perform these vital searches. If you are considering selling a sectional title property and are unsure as to how your exclusive use area is owned, then contact your conveyancer who will attend on the Deeds Office and do a full sectional title search on your property.

The conveyancer will be able to look into further issues too in addition to the exclusive use areas e.g. real right of extension, tie conditions, any consents that are needed etc. This search will also assist the agent who will then know how to write up the deed of sale accordingly.

Contact Mark Witzmann on mark@oostco.co.za or 021 461 0065 for further details.

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 legal adviser for specific and detailed advice.