Finalising a property purchase is an exciting occasion for first-time purchasers and seasoned property investors alike. Yet, STBB’s property law attorneys often find that many first-time purchasers rush through this significant step without understanding its implications. Armed with expert tips and the services of an experienced property lawyer, however, prospective purchasers can confidently negotiate any sale agreement.
Conduct a proper inspection of the property
Before submitting an offer, it is essential to thoroughly research the property’s location, age, history, current condition, past problems, and estimated market value to gain a clear understanding of the property. Ultimately, this minimises the risk of disappointment and needless complications for all parties involved in the transaction.
In the context of property transactions, defects discovered post-signature are commonplace. This has necessitated the inclusion of the voetstoots clause, which specifies that the property is sold as is, including defects. Accordingly, it is imperative to understand that a seller will generally not be liable for the discovery of any patent defects, which are easily ascertainable upon an inspection of the property, after the sale agreement has been finalised. For clarity, patent defects include cracked windows, broken tiles, and missing ceiling fans. Contrastingly, a seller will be liable for latent defects, such as mould or roof leaks, if they fraudulently failed to disclose such defects to the agent and/or purchaser.
Understand your affordability
Ensure that you have a sound idea of what you can afford prior to making an offer. With clear boundaries in mind, you’ll be in a better position to negotiate – and to avoid entering into a financially unfavourable deal.
Indeed, obtaining bond pre-qualification gives you access to your credit score and a realistic estimate of the bond amount and monthly repayments you can afford. While pre-qualification does not guarantee bond approval, it will enable you to embark on a property search within a suitable price range based on your affordability.
Obtain professional legal advice
Undoubtedly, a sale agreement signals the legal basis for selling immovable property. Given the important legal components of property transactions, it is crucial that a sale agreement is drafted or assessed by a skilled attorney specialising in property law to ensure all parties’ concerns are clarified and resolved pre-signature.
Importantly, an attorney can assist with obtaining and reviewing title deeds to ensure there are no caveats or restrictive conditions, assess whether approved building plans are in place, and conduct a compliance review.
Negotiate any special conditions
It is essential to modify the agreement to accommodate special conditions. For instance, discuss any required repairs with the seller upfront. If they agree to finance the repairs prior to the transfer of the property, this must be expressly stipulated, along with a description of the repairs. Similarly, if you agree to purchase the property, with various outdoor furniture included in the sale price, these items must be listed in an inventory annexed to the sale agreement.
Incorporate suspensive conditions, if needed
Suspensive conditions are commonplace in OTPs, the legal effect of which is to suspend the operation of the agreement until the fulfilment of a future certain or uncertain event. Most often, a suspensive condition deals with the contours of obtaining mortgage bond approval or selling a property to finance the transaction. For legal certainty, specific timeframes – and a clause enabling the parties to agree to any extensions – must be incorporated.
For further information or expert legal support in drafting a sale agreement that clarifies all of your concerns, contact our experienced property law attorneys at info@stbb.co.za today.
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