Question 1

What is transfer duty in South Africa?

Accepted Answer

Transfer duty is a tax you pay to SARS when you buy property. It's based on the purchase price. Properties under R1,100,000 pay no transfer duty. Above that, you pay on a sliding scale from 3% up to 13% for properties over R11 million.

Question 2

Who pays the transfer costs — buyer or seller?

Accepted Answer

The buyer pays all transfer costs including transfer duty, conveyancing fees, and deeds office fees. The seller only pays their own bond cancellation fees and agent commission. This catches many first-time buyers off guard.

Question 3

How much are conveyancing fees?

Accepted Answer

Conveyancing (attorney) fees are set by a guideline tariff based on the property value. For a R1.5 million property, expect around R20,000-R30,000 for transfer attorney fees and a similar amount for bond registration attorney fees.

Question 4

Do I pay transfer duty on a new build from a developer?

Accepted Answer

No. If you buy a new property from a VAT-registered developer, you pay VAT (15%) instead of transfer duty. The VAT is usually included in the advertised price. You still pay conveyancing and bond registration fees though.

Question 5

How long does the transfer process take?

Accepted Answer

The full transfer process typically takes 8-12 weeks from when the offer is accepted. This includes bond approval (2-3 weeks), conveyancing preparation (3-4 weeks), and deeds office registration (2-3 weeks).

Question 6

Can I add the transfer costs to my bond?

Accepted Answer

Some banks allow you to include transfer and bond registration costs in your home loan (up to 105% loan-to-value). However, this means you'll pay interest on those costs for the full loan term. It's better to save for these costs separately if possible.

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