14 Jan 2013
There have been cases, when selling a property, where occupation has been given to a buyer and that buyer starts renovations or making changes to the property before transfer has taken place and, in one case heard of recently, before the bond had even been approved.
This should never be allowed, says Lanice Steward, managing director of Knight Frank Anne Porter. Occupation of a property should only be given to a buyer after all the suspensive conditions in the offer to purchase have been fulfilled. It is risky to give the purchaser occupation if conditions such as bond approval or any other finance condition (such as a guarantee, because even these can be reneged on) have not been fulfilled or completed.
In addition, all transfer documents must be signed, the deposit must be paid on time and, if applicable, the outstanding balance between the bond and the purchase price must be given to the conveyancer to be held in trust, says Steward.
The seller must be protected against the buyer carrying out any renovations before the transfer takes place in the form of a clause in the sale agreement prohibiting him from doing so, she says. This is a standard clause in a number of purchase agreements, but the seller must check that it is written in to protect himself.
“If a purchaser wants occupation prior to transfer, extreme caution must be taken and certain 'boxes need to be ticked',” says Steward. “In my experience, when the offer to purchase is 'too good to be true' in that it is above the asking price and has come through in a very short time after putting the house on the market, it sometimes is.
“If the buyer starts making changes without any form of security for the seller, he must contact the conveyancer and the agent immediately, the buyer must be pushed to pay in some form of collateral so that if the deal goes 'belly up' there are funds available to return the house to its original state,” says Steward.
House for sale in Soshanguve East R 329 000
House for sale in Constantia R 21 950 000
House for sale in Mayville R 1 550 000
Townhouse for sale in Summerstrand R 1 150 000
House for sale in Rietfontein R 810 000
House for sale in Waverley & Ext R 1 899 000
Apartment / Flat for sale in Moregloed R 525 000
House for sale in Vanderbijlpark SE7 R 1 600 000
Farm for sale in Vredefort R 3 200 000
House for sale in Vanderbijlpark SE7 R 1 370 000
If you are using Internet Explorer 8 or higher, please verify that your Internet Explorer compatibility view settings are not enabled.
For the best browsing experience update to the latest Version of Internet Explorer or try out Google Chrome or Mozilla Firefox.
Please contact our Customer Service Centre for further assistance. Tel. +27 (0)861 111 724