What Every Seller Needs to Know Before Accepting an Offer
We often hear sellers say, “If my property sells for R2 million and I owe R1 million on my bond, I will have R1 million left.”
Unfortunately, it is not quite that simple.
There is a common misconception that the buyer carries all the costs associated with a property transaction. Sellers have their own costs to consider and if these are not explained properly upfront, it can result in an unexpected financial shortfall.
Depending on the property and the seller’s circumstances, these can include the Property Practitioner’s professional fee and VAT, bond cancellation costs, bond interest and settlement amounts, municipal rates, HOA or Body Corporate levies and compliance certificates such as electrical, electric fence and gas certificates.
One area that can particularly surprise sellers is the amount required for municipal rates and HOA or Body Corporate clearances. Several months’ worth of rates and levies may need to be paid in advance to obtain the necessary clearance figures and certificates for transfer.
This is why we believe sellers should ask two questions before placing their home on the market and accepting an offer:
“What is my property likely to sell for?”
and just as importantly:
“What will I actually walk away with?”
Understanding your estimated net proceeds before accepting an offer allows you to plan properly and avoid an unpleasant financial surprise when the transfer is underway.
A good Property Practitioner should help you understand these potential costs from the outset. At REMAX Dazzle, we believe an informed seller is an empowered seller.
Got a question, ask me!
Cindy Brits
Managing Director
084 569 9590
or send your questions to cindyb@remaxdazzle.co.za
RE/MAX Dazzle
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