Sellers should ensure buyers can fund transfer costs

Property sellers should ensure that any potential buyer has enough cash on hand to cover all costs related to transfer of the property.

“The transfer of a property can be delayed or even fall through if the buyer does not have the funds available to cover associated costs such as, bond registration, legal fees, and, of course, transfer duty,” says Martin Schultheiss, CEO of the SA real estate giant Homenet.

“High property prices and stricter lending criteria have resulted in potential buyers putting more of their cash towards a deposit and there is a real danger that they will underestimate the amount needed for the transfer costs.

“And with properties taking longer to sell, it is vital that a potential sale is not scuppered by failing to make sure that the potential buyer indeed has the necessary cash reserves.”

Schultheiss says potential buyers should thus be properly pre-qualified and sellers should make this a condition of awarding a mandate to any agent.

“It might be difficult for an individual seller to determine a potential buyer’s financial status and this is often the reason for private sales running into delays or collapsing.

“But an experienced estate agent will have little difficulty and will be perceived as acting in the best interests of his client when he informs the buyer about the additional costs and then requests assurance that these will be met on time,” he says.

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