Signing an agreement of sale? Here's what you're agreeing to.
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Whether you're buying or selling a property, signing that agreement of sale is a big moment. It's important to understand that this is a document that comes with legal implications, and that changing your mind after signing is unlikely to be an option. Jawitz Properties breaks down some of the terms and conditions laid out in our Agreement of Sale documents to give buyers and sellers a clear idea of what they are signing.
Voetstoots and full disclosure
If you're a buyer, then signing on the dotted line is acknowledging that you are buying the property "voetstoots", or exactly as it is on the date you signed the offer to purchase. You need to ensure that you have made yourself aware of all material aspects relating to the property.
If you're the seller, you have a duty to disclose to the agent/purchaser all the visible and non-visible defects that you are aware of on the property. You will acknowledge this by accepting the offer to purchase. By signing, you ensure full disclosure and affirm that the Jawitz agent negotiating your sale has been advised of all these visible and non-visible defects.
Further to the above, there is a responsibility on the seller to ensure:
- that the property remains in the same condition that it was in at the time of the signing of the agreement up until occupation/registration has taken place and;
- that all fixtures and fittings in the property are in good working order.
Most importantly, the Consumer Protection Act (CPA) is not applicable to the sale and purchase of a second-hand home. This means that, if you are the purchaser, you will not be able to give the person who you bought the property from a list of defects to fix after you have moved in. The CPA is only applicable if you have brought your property from a developer.
Occupation dates and occupational rent
As the buyer, you and your family will be allowed to take occupation of your new home on a date specified in the agreement of sale. If this date arrives before the transfer of the property has been finalised, then you will be required to pay the seller occupational rent for the privilege of occupying the property. The occupational rent amount is stipulated in the agreement of sale. Over and above this, you will be required to reimburse the seller for water, electricity and gas that you use before the date that the transfer is finalised. It is important to understand that taking early occupation is not the same as being a tenant, and the normal rights of a tenant will not apply to you.
In order to be able to move into your new home on the date specified in the agreement of sale, you have to have fulfilled certain obligations. If finance has not yet been approved and you have not yet signed all the transfer and bond documents, as well as paid the bond costs and transfer duties, then you will not be entitled to move into the property. The sting in the tail is that, should the reason for your not being able to move in be the direct result of negligence or delays on your side, then you will still be liable to pay occupational rent.
If you have moved into a property before transfer has been finalised, you'll need to put plans for renovations and improvements on hold. No changes may be made to the property before transfer has officially gone through. Similarly, as the new owner, you may not rent the property out until the transfer process has been concluded.
In the opposite scenario, if the transfer process is finalised before the stipulated date, then the seller will pay the buyer occupational rent along with consumption costs for the utilities used.
Proof of electrical, gas and electric fence compliance
As part of the property sale process, the seller is required to provide the buyer with a certificate of compliance from a registered electrical contractor. This verifies that all household electrical systems are safe and up to date. This requirement is laid down in the Occupational Health and Safety Act. This certificate must be provided on or before the date of transfer or the date of occupation - whichever comes first. If you are selling a property that has an electric fence, you will also need to provide a certificate of compliance from a registered electric fence system installer.
Similarly, if you are selling a home that has any piped or cylinder gas installations, then you will need to get a certificate of conformity for these.
Buying or selling property is a complicated process, and you need #Real guidance every step of the way. Jawitz' widely experienced #RealAgents are the perfect property partners. Contact us today and let's make the process of selling your home, or finding and buying your new home, as smooth as possible.
Author: Jawitz Properties
