Introduction

Before finalizing the purchase of a property, it is essential for any prudent buyer to consider several important factors. This guide aims to provide valuable information to help purchasers make informed decisions.

Inspecting the Property

When purchasing immovable property, it is the seller's responsibility to disclose any hidden defects they are aware of, while the purchaser should inspect the property diligently. While the seller is not obliged to disclose visible defects, buyers should conduct a thorough inspection. 

This includes checking water pressure, looking for signs of dampness, and testing fixtures and fittings. Although a disclosure document from the seller may be available, it should not replace the duty of inspection. Any defects discovered during the inspection should be documented in the sale agreement for resolution.

Documents

Before entering into a sale agreement, it is important to review various documents related to the property. The following table outlines the documents that may need to be perused based on the type of property:

FICA Documents

It is crucial for purchasers to provide the necessary FICA documents to the property practitioner and conveyancer upon request. These documents vary depending on the type of purchaser. For individuals, proof of identity, residence, SARS tax number, and banking details are required. A FICA checklist should be consulted for further guidance.

Mortgage Bond 

If the purchaser plans to finance the property acquisition through a mortgage bond, it is essential to gather all the necessary documents required for the loan application. Property practitioners or bond originators can provide guidance on the specific requirements and eligibility for loan finance. It is important to fulfill any conditions related to loan finance stated in the sale agreement.

Issues to Consider

Several important issues should be considered during the purchasing process, such as:

Contractual Capacity 

For companies, close corporations, and trusts, it is crucial to have the appropriate authorizations in place before signing the agreement. Trusts that do not yet exist cannot purchase property, and it is no longer possible to purchase property on behalf of a close corporation to be formed. For individuals, ensure any necessary matrimonial and other consents are obtained when applicable.

VAT Registration 

Determining whether transfer duty or VAT is payable depends on the seller's VAT registration status. Proper advice from an accountant or auditor should be sought to understand the VAT implications and whether the purchase price includes or excludes VAT.

Building Plans Approved 

Inspect the building plans to ensure that the property being sold has approved plans, and all improvements on the property are included in those plans.

These are just a few key points from the comprehensive guide. It is important for purchasers to review all aspects carefully, consult professionals when needed, and ensure that all necessary documentation is in order throughout the purchasing process.