Good news for South Africans looking to sell their house

The tide is turning for South African homeowners looking to sell their properties, as recent interest rate cuts, with more expected to come, are set to boost the local property market.

Seeff Property Group Samuel Seeff said the interest rate cuts delivered so far are projected to lead to an increase in buyers.

The Reserve Bank’s Monetary Policy Committee has cut South Africa’s rates by a cumulative 75 basis points in this cutting cycle, with the first cut implemented in September last year.

This is nowhere near the 475 basis points interest rates have increased since the start of the hiking cycle in November 2021.

However, this will provide significant relief to South Africans, particularly homeowners, with the property market also set to benefit.

“Mortgage originators such as ooba have started reporting notable increases in home loan applications following the interest rate cuts last year, and the market is expected to pick up further momentum as a result of the latest rate cut,” he said.

He explained that this is great news in areas with high stock levels where sellers had to compete with many other sellers. 

“It is therefore recommended that sellers should take advantage of the favourable opportunities to sell. Don’t wait too long for a higher price,” he warned.

“While further interest rate cuts are on the cards, the Reserve Bank has cautioned that these are not guaranteed.” 

Therefore, he explained that waiting too long for a better offer or higher price might result in the seller losing out. 

“There is also no guarantee that a higher price offer may be forthcoming,” he said.

In areas with high stock levels, sellers should also be mindful that they may be competing with other property listings. 

“If the asking price is already at the higher end compared to other properties on the market, it may result in buyers rather looking at competing properties,” he said.

“The advice is that sellers should be ready to capitalise on opportunities in the market.” 

He urged sellers to ensure the property is in great shape and well-maintained so that there is nothing that will put buyers off. 

“Sellers should also leave nothing for buyers to quibble about by ensuring their property is priced correctly and that the asking price is in line with similar properties on the market,” he said. 

“If not, you may well end up simply driving buyers to competing properties.”

Seeff advised sellers to ensure that all the paperwork pertaining to it is in order and that the property is compliant. 

This will speed up the sale and transfer of the property, give the buyers peace of mind and facilitate a smooth and efficient transaction.

“Sellers should also be aware of the transaction costs that they are responsible for,” he said. 

“These include the estate agency commission, which is usually negotiated upfront and payable upon registration of transfer.”

“Additional costs that the seller is responsible for include repairs needed to obtain various Certificates of Compliance for aspects such as electricity, water, electric fence, and other connections and any repairs necessary to make these compliant.”

He warned that there may also be bond cancellation costs payable if there is a mortgage bond registered over the property

Sellers will also be required to ensure that all outstanding costs to the local municipality are settled. 

“The transferring attorneys will obtain the necessary clearance from the municipality, and some municipalities require upfront payment of rates and services for up to four months, depending on the municipality,” he said. 

“Any surplus can, however, be claimed back after the registration of transfer of the property.”

For a sectional title or estate property, the clearance certificate will be provided by the Body Corporate or Homeowners Association. 

“The seller will need to ensure that all levies are up to date, including any special levies which may need to be paid up before the property can be transferred,” Seeff said.