What costs are the Seller liable for during the sale of a property?

/ / News, 2021, community Schemes, COVID-19

Article written by Ayanda Motlou, Candidate Attorney, checked and released by Mark Blanckenberg, Partner at Schindlers Attorneys

24 August 2021


The Seller is liable for several costs incurred during the sale of a property. Included below is a list of costs to prepare you for the sale of your home.

The Agent’s Commission

Should you mandate an Estate Agent for the sale of your property, commission will be payable to the Estate Agent. The amount to be received by the Estate Agent is agreed upon by the Seller and the Estate Agent in a contractual agreement called a mandate. The commission is a percentage of the selling price of the property, and is only due and payable once the property has been sold. Commission is normally paid directly by the conveyancer after registration of transfer. Thus, the payment is deducted from the Seller’s proceeds, and the Seller need not make the payment upfront.

Mortgage Bonds

For the property to be transferred, all mortgage bonds which are registered over the property must be cancelled. In terms of the National Credit Act, should you wish to sell your home, you must notify your bank, in writing, of your intention to cancel the mortgage bond. 90 days notice is the general requirement, however, notice periods may vary depending on the Financial Institution. Such notice does not result in the automatic cancellation of the mortgage bond on expiry of the notice period, it merely constitutes the intention to do so.

Bond Cancellation Costs

Cancellation of the mortgage bond is to be carried out by a bond attorney to be assigned by the relevant financial institution. Costs attached to the cancellation of the mortgage bond include an additional fee if 90 days written notice of the intention to cancel the mortgage bond was not provided, as such, it is highly advisable that written notice be provided prior to the property being placed on the market. Should the bond be cancelled within the notice period, interest will be charged on the additional days on a pro-rata basis.
Generally, bond cancellation costs amount to R4500, which may vary depending on the abovementioned penalties and additional costs, and the number of mortgage bonds registered over the property. This amount is often deducted off of proceeds of sale, and the Seller is not required to pay upfront.

Rates Clearance Costs

A Rates Clearance Certificate is a document provided by your municipality wherein they certify that you, as the Seller, do not have any outstanding funds in relation to their charges. The transferring attorneys will apply for the rates figures from your municipality. The rates figures will include the funds which you are currently owing, any arrears on the funds, and collections for the next 3 – 4 months.
The Municipality insists that payments be made 3-4 months in advance based on the rates figures to insure that all costs will be covered during the process of sale. After the transfer of the property has been registered, the municipality will be made aware of the transfer by the conveyancer and Deeds Office, and the account will be adjusted accordingly. Any refunds due in this regard will be payed to the conveyancing attorneys, who will then forward these to the Seller.

Levy Clearance Costs

If the home is part of a sectional title property or an estate, you will be required to make an advance payment for all levies owed in order for registration to take place. This administrative process will be handled by the Conveyancers.

Homeowners Association

Should your property form part of a Sectional Title or an Estate with a homeowners’ association, the Seller must receive confirmation that they have met all the conditions in the title deed, e.g that all outstanding amounts due to the homeowners’ association must be settled, that the Seller meets all the conditions in the homeowner’s memorandum of incorporation, and the successive owner of the property has agreed to be a member of the Association. The confirmation is in the form of a Homeowners Association Certificate, which the transferring attorneys will apply for, together with an application for the clearance figures. In some instances, the Homeowners Association insists on an advance payment of the levies, which will then be split between the Seller and the new owner on a pro-rata basis on registration of the transfer, until the Certificate becomes valid.

Lost Title Deed

The Tile Deed is an essential document in registering the transfer of your property. In the event that you have lost your Title Deed, an application must be made to the Deeds Registry who will then provide you with a certified copy to serve in place of the original. A lost title deed application, including the advertisement for the Deed will cost roughly R3500.

Compliance Certificates

In Gauteng, it will be required of you as the Seller to acquire compliance certificates for gas, electricity, and electrical fence, prior to the property being transferred to the new owner. The required compliance certificates include, but are not limited to:

a. Electrical
An Electrical Certificate of Compliance confirms that all electrical work done on the property was done according to statutory stipulations. Should the Seller have an existing valid certificate that is not older than two years, a new certificate is not required for the transfer of the property if no alterations were made to the electrical installation after the certificate was issued.

b. Electric fence
If a private electric fence (not part of the complex) is installed on the property, a separate certificate from the Electrical Certificate of Compliance is required, as the electric fence is governed by different regulations that are applicable to electrical machinery.

e. Gas
In terms of the regulatory requirements, a certificate of compliance must be issued for any liquid gas appliance installed on a property. Only an authorised person registered with the LPGAS may issue the Certificate. Liquid gas appliance installations include built in gas fires, hot water systems and stoves.


The property sales can be quite profitable, however, there are several costs that you, as the Seller are responsible for. Provided herein is a list of all costs you will incur should you intend on selling your property, so you do not get caught off guard.

Share Article: