When buying a house in South Africa, several costs go beyond the property price. Here is a detailed breakdown of the main costs involved:
1. Deposit
A deposit is typically required when purchasing a property and can range from 10% to 20% of the purchase price. This amount depends on the lender and your credit profile.
2. Bond Registration Costs
If you're taking out a home loan, you'll need to register the bond with the Deeds Office. This involves:
Bond Registration Fees: Paid to a bond attorney, based on the loan amount. Higher loan amounts incur higher fees.
Deeds Office Fees: The government charges fees to register the bond.
Postage and Sundries: Smaller costs for administrative expenses associated with registering the bond.
3. Transfer Duty
Transfer duty is a government tax paid by the buyer on properties over a certain value (currently R1 million and above). The amount is calculated on a sliding scale based on the property’s purchase price, and the rate can vary depending on the property value.
4. Transfer Costs
This covers the legal work involved in transferring the property to your name and is paid to a conveyancing attorney. Transfer costs include:
Conveyancing Fees: Charged by the attorney for processing the paperwork, based on the property’s purchase price.
Deeds Office Registration Fees: The fees for registering the transfer with the Deeds Office.
Postage, Petties, and Sundries: Miscellaneous charges that may include document couriering and other minor expenses.
5. Bank Initiation Fee
Most banks charge a one-time initiation fee for processing your home loan, which can be paid upfront or added to the loan amount.
6. Valuation Fees
Banks often require a valuation of the property to determine its market value before approving the home loan. This fee may sometimes be included in the
