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Before listing your property for sale, it is recommended that you first do the calculations for all the associates costs so that you can budget accordingly.
“Sellers are often surprised by the various costs involved in selling a property. To avoid being left with less than anticipated, sellers should discuss these expenses with their real estate professional and calculate the total costs before marketing their home,' advises Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa.Many sellers forget that 15% VAT is charged on top of the agent’s commission.
For example, an agent's commission on a R1m property at a 6% commission rate plus 15% VAT would amount to R69,000 in total .Sellers need a rates and taxes clearance certificate from the local municipality for the transfer to proceed. This fee ensures that rates and taxes are paid during the registration process, often requiring payment for two to six months in advance. If registration is completed sooner, the municipality will refund the excess amount.
To calculate this, multiply your latest municipal bill and levy invoice by three to have a rough budget set aside to cover this.Sellers will need to consider the amount outstanding on their bond in order to calculate how much they will make on the sale of their home. Apart from this, each financial institution also has its own rules and charges for cancelling an existing bond. Sellers should check with their institution to determine the expected fees.
“Understanding the possible costs involved in a property sales transaction and doing the necessary calculations ahead of time will give sellers a far more accurate picture of what they can expect to get once the sale has been finalised,” Goslett concludes.
Property Finance Selling Property
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