Questions and Answers
- How does an estate agent operate?
- How do I choose an estate agent?
- What is the most important aspect when selling or buying a home?
- What's the first thing I should do when buying a home?
- What should I consider when buying a new home?
- When do I have to make a payment for the property I wish to buy?
- Why do I need an estate agent?
- How much should I budget for my new home?
- What is in a Sales Contract?
- How do I apply for a home loan?
- What is "Occupational Rental"?
- What should I do inside my home when selling?
- What market price should I ask for my house?
- What is a sole mandate?
How does an estate agent operate?
Usually a seller will approach an estate agent to sell his property. If the seller is happy with the estate agent's marketing plan and commission proposal, the seller will then give the agent instructions (a mandate) to sell. Such arrangements should preferably be recorded in writing. Only then should the estate agent be allowed to put the property on the market. Remember - the amount of commission payable, usually by the seller, is negotiable, and in most cases attracts VAT.
How do I choose an estate agent?
Choose an estate agent who appears to have the trust of the community. Such trust is usually achieved through expert and honest dealing. For sale and sold boards are usually your best indicators to a dominant agency. Keep your eyes and ears open!
What is the most important aspect when selling or buying a home?
Common sense. Don't be in a rush. Do your research, always ask for advice and before you sign anything make sure you fully understand all the terms of sale and all the relevant details and arrangements.
What's the first thing I should do when buying a home?
Relax! Everyone is eager to buy a new home. Use your common sense and always ask for advice from experienced people in property matters. Make sure you check with the bank the amount of the bond you can obtain.
What should I consider when buying a new home?
Think about your future needs. Check if the property is close to work, hospitals, shops, schools, etc. Is the property in a good neighbourhood, with good security and close to main roads? But most important, can you afford it, and what extras must you pay for? Don't forget to include rates, electricity, water, etc. when working out what you can afford.
When do I have to make a payment for the property I wish to buy?
Never make any payments unless you absolutely fully understand all the documentation, and have fully inspected the property. When you pay a deposit make sure you get a proper receipt from the estate agent who must keep your payment in trust until registration of transfer. The balance of the purchase price usually comes from the loan granted by a bank.
Why do I need an estate agent?
An estate agent's job is more than just showing you homes you might be interested in. Just as important as finding your new home, is coming to an agreement with the seller, and arranging a home loan that suits your financial situation. It is the estate agent's job to ensure that these things are taken care of quickly, and to guide you through the process. There are many pitfalls to buying and selling real estate without engaging a professional estate agent.
For example, a buyer needs to know what hidden costs there are to purchasing fixed property. You may ask yourself "How will I know I am viewing the best properties in the area? Who will explain the Purchase Agreement, and how will I know I can trust that person? How can I spot a latent or patent defect in a property? Who will explain the implications of putting my signature to any document? Do I have the expertise to co-ordinate a smooth transaction from purchase to registration of the property?"
As a seller, you may ask yourself "When will I allow a stranger to enter my home? How will I qualify a buyer? How much deposit should I require, and when will this deposit be payable? How long does it take to secure a loan? What special conditions should be included in the contract? Do I have the negotiating skills to ensure the best possible price?"
How much should I budget for my new home?
When you are budgeting for your new home, there are two types of costs involved:
Once off costs:
What is in a Sales Contract?
The signed 'Offer to Purchase', or more commonly known as the sales agreement, is the document you sign which presents your price and terms to the seller. It must be completed in full, because when the seller signs it, the document becomes the binding 'Sales Contract' which contains the conditions of the sale. If you forget something in the offer, you can't usually add it to your Sales Contract later. Terms and conditions of the contract vary depending on the situation.
You and the seller may negotiate and agree on:
How do I apply for a home loan?
Your agent can assist you in making an application to a financial institution for a home loan. There are many flexible financial packages available to borrowers, along with variable interest rates, or capped options. You may buy a home with another person, if you are not married. The property will be registered in both applicants' names, provided they have contractual powers. The institution will require all your personal particulars, and a statement of assets and liabilities. Other documentation required is usually (where necessary):
You must be over 21 years old and have full-time employment. The monthly repayment must not be more than between 25% and 30% of your gross income per month. You must have a clear credit record and be able to afford the property.
What is "Occupational Rental"?
If one of the parties is in occupation of the property whilst it is registered in the other's name, it is usual for the agreement of sale to make provision for the payment of occupational rental during that period. The exact amount and date of occupation should be clearly stipulated in the contract.
What should I do inside my home when selling?
Kitchen and bathrooms should be spotlessly clean! Even a minor facelift - fresh paint, new floor tiles and new cupboard doors, for example - will pay off in a faster sale at a better price. It is usually better to keep to light neutral colours when renovating.
Make sure countertops are clean and uncluttered, and cupboards tidy. In all bedrooms, family rooms and sun rooms, be sure to pack away unnecessary items and keep the floors clear of toys! Create space, where possible, and open the curtains to let the sunshine in. If you have a pool, be sure to keep it sparkling clean. Paint and repair garden furniture and brighten it up with pretty cushions. First impressions count! Keep your lawn neatly trimmed and mowed.
What market price should I ask for my house?
The difference between 'Listing' your home and 'Selling' it is usually PRICE! The value of a home is determined not by what the owner has invested in the property, but by what a willing and able purchaser will get out of it. Principles to keep in mind when considering price:
What is a sole mandate?
Under a sole mandate a seller instructs a particular Estate Agency to find a buyer and no agent from any other company may market the property during the sole mandate period.
Our Property Terms & Definitions
Terms and Definitions
There are a number of Real Estate words that come up in the process of buying and selling a house that may sound foreign to you, so we've tried to give you a simple definition of what these words really mean. Simply put, it's the stuff you need to know.
- Addendum
- Agreement of sale
- Breach clause
- Conditions of title
- Cooling-off right
- Electrical compliance certificate
- Entomologist's certificate
- Escape clause
- Fixtures and fittings
- Guarantees
- Interest-bearing accounts
- Jurisdiction
- Rockthatch Realty
- Null and void
- Prior occupation
- Offer to purchase
- Possession
- Property description
- Subject to sale
- Suspensive condition
- Voetstoots
Addendum
A supplementary agreement to an original sale contract covering points agreed to afterwards. It is a separate agreement in its own right and, if it contradicts the original in any way, it is presumed to overrule it.
Agreement of sale
The basic contract of sale and purchase between a buyer and a seller. No matter what you two have agreed to verbally no contract exists until an agreement of sale is completed and signed by both you and the seller.
Breach clause
A condition in a contract obliging a seller to give a defaulting buyer written notice to remedy his breach of contract within a specific period (usually seven days) before he can cancel the sale.
Conditions of title
These are the restrictive conditions limiting an owner's rights which are recorded on his title deed to a property. They cover matters such as mineral right reservations, servitudes and building limitations.
Cooling-off right
A statutory right, recorded in Section 29A of the Alienation of Land Act, giving a buyer of a residential property costing R250 000 or less the right to withdraw from the sale within five days of making a written offer
Electrical compliance certificate
A certificate issued by a qualified electrician confirming that the installation on a property from its supply point is safe. Every buyer has to be in possession of one once he takes transfer of ownership.
Entomologist's certificate
A similar certificate required by law in some coastal provinces to be obtained before transfer of a property confirming that its structure is free of woodborer or termite infestation.
Escape clause
A condition in sale contract giving the seller the right to cancel it if he obtains a better offer from another purchaser. It is usually inserted when the first buyer is given time to sell his own property first.
Fixtures and fittings
These are attachments to a home which are deemed to permanently belong it. They include light fittings, curtail rails, TV aerials and eye-level ovens and may not be removed by the seller when he vacates the property.
Guarantees
Written undertakings issued by registered banks guaranteeing payment of part or all of the purchase price on registration of transfer. They are furnished to the transferring attorney.
Interest-bearing accounts
A savings account or other short-term investment opened by an attorney or estate agent to invest any deposit paid by a buyer. The interest accruing will accrue to the buyer on transfer.
Jurisdiction
Most sale agreements contain a clause providing that, should either party take the other to court for any alleged default, he may do so in a Magistrates Court even though the amount in dispute may exceed its normal jurisdiction.
Rockthatch Realty
The most exciting, passionate and dynamic real estate group in the country . Whether you're buying or selling, your journey with Rockthatch Realty is guaranteed to be a pleasure.
Null and void
A legal expression emphasizing a final cancellation or lapse of a sale agreement. It puts both parties in the position they were in before the agreement was signed and leaves each without obligation to the other
Prior occupation
A buyer's right to take personal occupation of a property before transfer takes place. A rental, agreed to in advance between the parties, will be payable by the buyer until registration of transfer
Offer to purchase
A document setting out the proposed purchase price and conditions on which a buyer is prepared to purchase a property. It will be submitted to the seller and, once he signs it, it becomes a valid sale agreement
Property description
This is the definition of the property sold in a sale agreement. It can simply be its street address but usually records its erf number and township as described in the owner's title deed.
Possession
A stronger right than occupation which usually only passes on registration. It entitles the buyer to receive all rentals paid by existing tenants while obliging him to pay all assessment rates.
Subject to sale
An expression used by estate agents to describe a sale contract which will only become unconditional between the parties if and when the buyer sells his own property. A time period of sixty days is usually allowed.
Suspensive condition
A provision in a contract suspending its operation until a specific condition is fulfilled. A clause stating that the sale will only be confirmed if a mortgage loan is granted is a typical suspensive condition.
Voetstoots
A Dutch expression meaning that a property is bought "as is" with all its patent and latent defects. A Seller can still be held liable for latent defects known to him which he fails to disclose to the buyer. There are a number of Real Estate words that come up in the process of buying and selling a house that may sound foreign to you, so we've tried to give you a simple definition of what these words really mean. Simply put, it's the stuff you need to know
- How do I choose an estate agent?
- What is the most important aspect when selling or buying a home?
- What's the first thing I should do when buying a home?
- What should I consider when buying a new home?
- When do I have to make a payment for the property I wish to buy?
- Why do I need an estate agent?
- How much should I budget for my new home?
- What is in a Sales Contract?
- How do I apply for a home loan?
- What is "Occupational Rental"?
- What should I do inside my home when selling?
- What market price should I ask for my house?
- What is a sole mandate?
How does an estate agent operate?
Usually a seller will approach an estate agent to sell his property. If the seller is happy with the estate agent's marketing plan and commission proposal, the seller will then give the agent instructions (a mandate) to sell. Such arrangements should preferably be recorded in writing. Only then should the estate agent be allowed to put the property on the market. Remember - the amount of commission payable, usually by the seller, is negotiable, and in most cases attracts VAT.
How do I choose an estate agent?
Choose an estate agent who appears to have the trust of the community. Such trust is usually achieved through expert and honest dealing. For sale and sold boards are usually your best indicators to a dominant agency. Keep your eyes and ears open!
What is the most important aspect when selling or buying a home?
Common sense. Don't be in a rush. Do your research, always ask for advice and before you sign anything make sure you fully understand all the terms of sale and all the relevant details and arrangements.
What's the first thing I should do when buying a home?
Relax! Everyone is eager to buy a new home. Use your common sense and always ask for advice from experienced people in property matters. Make sure you check with the bank the amount of the bond you can obtain.
What should I consider when buying a new home?
Think about your future needs. Check if the property is close to work, hospitals, shops, schools, etc. Is the property in a good neighbourhood, with good security and close to main roads? But most important, can you afford it, and what extras must you pay for? Don't forget to include rates, electricity, water, etc. when working out what you can afford.
When do I have to make a payment for the property I wish to buy?
Never make any payments unless you absolutely fully understand all the documentation, and have fully inspected the property. When you pay a deposit make sure you get a proper receipt from the estate agent who must keep your payment in trust until registration of transfer. The balance of the purchase price usually comes from the loan granted by a bank.
Why do I need an estate agent?
An estate agent's job is more than just showing you homes you might be interested in. Just as important as finding your new home, is coming to an agreement with the seller, and arranging a home loan that suits your financial situation. It is the estate agent's job to ensure that these things are taken care of quickly, and to guide you through the process. There are many pitfalls to buying and selling real estate without engaging a professional estate agent.
For example, a buyer needs to know what hidden costs there are to purchasing fixed property. You may ask yourself "How will I know I am viewing the best properties in the area? Who will explain the Purchase Agreement, and how will I know I can trust that person? How can I spot a latent or patent defect in a property? Who will explain the implications of putting my signature to any document? Do I have the expertise to co-ordinate a smooth transaction from purchase to registration of the property?"
As a seller, you may ask yourself "When will I allow a stranger to enter my home? How will I qualify a buyer? How much deposit should I require, and when will this deposit be payable? How long does it take to secure a loan? What special conditions should be included in the contract? Do I have the negotiating skills to ensure the best possible price?"
How much should I budget for my new home?
When you are budgeting for your new home, there are two types of costs involved:
Once off costs:
- Deposit on your new home
- Conveyancing (attorney's) fees, bond registration fees
- Municipal deposits for water and electricity; telephone
- Cost of moving, new curtains and carpets etc.
- Repayment of home loan
- Insurance on your home
- Municipal rates and taxes or
- Monthly levy if you buy on Sectional Title.
What is in a Sales Contract?
The signed 'Offer to Purchase', or more commonly known as the sales agreement, is the document you sign which presents your price and terms to the seller. It must be completed in full, because when the seller signs it, the document becomes the binding 'Sales Contract' which contains the conditions of the sale. If you forget something in the offer, you can't usually add it to your Sales Contract later. Terms and conditions of the contract vary depending on the situation.
You and the seller may negotiate and agree on:
- the sale price of the home
- the amount of your deposit
- the amount of the home loan you will endeavour to obtain
- what items go with the home, such as curtains, appliances, swimming pool equipment etc.
- the date of occupation
- any conditions agreed upon by you and the seller which must be met before
- settlement can take place, such as: improvements (painting, roofing, etc); your
- ability to obtain a specified home loan within a specified time, or your ability to sell an existing home.
How do I apply for a home loan?
Your agent can assist you in making an application to a financial institution for a home loan. There are many flexible financial packages available to borrowers, along with variable interest rates, or capped options. You may buy a home with another person, if you are not married. The property will be registered in both applicants' names, provided they have contractual powers. The institution will require all your personal particulars, and a statement of assets and liabilities. Other documentation required is usually (where necessary):
- Proof of income
- Marriage certificate
- Original Identity Documents
- If divorced, copy of Decree of Divorce
- Copy of Deed of Sale or Offer to Purchase
You must be over 21 years old and have full-time employment. The monthly repayment must not be more than between 25% and 30% of your gross income per month. You must have a clear credit record and be able to afford the property.
What is "Occupational Rental"?
If one of the parties is in occupation of the property whilst it is registered in the other's name, it is usual for the agreement of sale to make provision for the payment of occupational rental during that period. The exact amount and date of occupation should be clearly stipulated in the contract.
What should I do inside my home when selling?
Kitchen and bathrooms should be spotlessly clean! Even a minor facelift - fresh paint, new floor tiles and new cupboard doors, for example - will pay off in a faster sale at a better price. It is usually better to keep to light neutral colours when renovating.
Make sure countertops are clean and uncluttered, and cupboards tidy. In all bedrooms, family rooms and sun rooms, be sure to pack away unnecessary items and keep the floors clear of toys! Create space, where possible, and open the curtains to let the sunshine in. If you have a pool, be sure to keep it sparkling clean. Paint and repair garden furniture and brighten it up with pretty cushions. First impressions count! Keep your lawn neatly trimmed and mowed.
What market price should I ask for my house?
The difference between 'Listing' your home and 'Selling' it is usually PRICE! The value of a home is determined not by what the owner has invested in the property, but by what a willing and able purchaser will get out of it. Principles to keep in mind when considering price:
- Cost -The amount actually paid for a property plus any capital improvements made since the purchase.
- Price - The stated amount an owner is willing to accept for a property.
- Value - The amount a Buyer is willing to pay, given a certain set of circumstances.
- Market Value - The amount that will bring a sale between a willing Buyer and a willing Seller. It is based on the history of similar properties recently sold in the area
What is a sole mandate?
Under a sole mandate a seller instructs a particular Estate Agency to find a buyer and no agent from any other company may market the property during the sole mandate period.
Our Property Terms & Definitions
Terms and Definitions
There are a number of Real Estate words that come up in the process of buying and selling a house that may sound foreign to you, so we've tried to give you a simple definition of what these words really mean. Simply put, it's the stuff you need to know.
- Addendum
- Agreement of sale
- Breach clause
- Conditions of title
- Cooling-off right
- Electrical compliance certificate
- Entomologist's certificate
- Escape clause
- Fixtures and fittings
- Guarantees
- Interest-bearing accounts
- Jurisdiction
- Rockthatch Realty
- Null and void
- Prior occupation
- Offer to purchase
- Possession
- Property description
- Subject to sale
- Suspensive condition
- Voetstoots
Addendum
A supplementary agreement to an original sale contract covering points agreed to afterwards. It is a separate agreement in its own right and, if it contradicts the original in any way, it is presumed to overrule it.
Agreement of sale
The basic contract of sale and purchase between a buyer and a seller. No matter what you two have agreed to verbally no contract exists until an agreement of sale is completed and signed by both you and the seller.
Breach clause
A condition in a contract obliging a seller to give a defaulting buyer written notice to remedy his breach of contract within a specific period (usually seven days) before he can cancel the sale.
Conditions of title
These are the restrictive conditions limiting an owner's rights which are recorded on his title deed to a property. They cover matters such as mineral right reservations, servitudes and building limitations.
Cooling-off right
A statutory right, recorded in Section 29A of the Alienation of Land Act, giving a buyer of a residential property costing R250 000 or less the right to withdraw from the sale within five days of making a written offer
Electrical compliance certificate
A certificate issued by a qualified electrician confirming that the installation on a property from its supply point is safe. Every buyer has to be in possession of one once he takes transfer of ownership.
Entomologist's certificate
A similar certificate required by law in some coastal provinces to be obtained before transfer of a property confirming that its structure is free of woodborer or termite infestation.
Escape clause
A condition in sale contract giving the seller the right to cancel it if he obtains a better offer from another purchaser. It is usually inserted when the first buyer is given time to sell his own property first.
Fixtures and fittings
These are attachments to a home which are deemed to permanently belong it. They include light fittings, curtail rails, TV aerials and eye-level ovens and may not be removed by the seller when he vacates the property.
Guarantees
Written undertakings issued by registered banks guaranteeing payment of part or all of the purchase price on registration of transfer. They are furnished to the transferring attorney.
Interest-bearing accounts
A savings account or other short-term investment opened by an attorney or estate agent to invest any deposit paid by a buyer. The interest accruing will accrue to the buyer on transfer.
Jurisdiction
Most sale agreements contain a clause providing that, should either party take the other to court for any alleged default, he may do so in a Magistrates Court even though the amount in dispute may exceed its normal jurisdiction.
Rockthatch Realty
The most exciting, passionate and dynamic real estate group in the country . Whether you're buying or selling, your journey with Rockthatch Realty is guaranteed to be a pleasure.
Null and void
A legal expression emphasizing a final cancellation or lapse of a sale agreement. It puts both parties in the position they were in before the agreement was signed and leaves each without obligation to the other
Prior occupation
A buyer's right to take personal occupation of a property before transfer takes place. A rental, agreed to in advance between the parties, will be payable by the buyer until registration of transfer
Offer to purchase
A document setting out the proposed purchase price and conditions on which a buyer is prepared to purchase a property. It will be submitted to the seller and, once he signs it, it becomes a valid sale agreement
Property description
This is the definition of the property sold in a sale agreement. It can simply be its street address but usually records its erf number and township as described in the owner's title deed.
Possession
A stronger right than occupation which usually only passes on registration. It entitles the buyer to receive all rentals paid by existing tenants while obliging him to pay all assessment rates.
Subject to sale
An expression used by estate agents to describe a sale contract which will only become unconditional between the parties if and when the buyer sells his own property. A time period of sixty days is usually allowed.
Suspensive condition
A provision in a contract suspending its operation until a specific condition is fulfilled. A clause stating that the sale will only be confirmed if a mortgage loan is granted is a typical suspensive condition.
Voetstoots
A Dutch expression meaning that a property is bought "as is" with all its patent and latent defects. A Seller can still be held liable for latent defects known to him which he fails to disclose to the buyer. There are a number of Real Estate words that come up in the process of buying and selling a house that may sound foreign to you, so we've tried to give you a simple definition of what these words really mean. Simply put, it's the stuff you need to know
