Property transactions during Covid-19

Property transactions during Covid-19

Under Alert level 4, the President announced a number of sectors which could return to work.

Author: Tansley Williams

Under Alert Level 4, the President announced some sectors could return to work. Among these sectors, the deeds office could re-open for business on the 4th of May. Most sellers, purchasers, banks, estate agents and conveyancing firms praised the announcement. It meant that property transactions (which came to a sudden halt during the nation-wide lockdown) could now continue and be finalized. This meant that eager purchasers could now move into their properties. Sellers could receive the proceeds of the sale of their property. Estate agents could receive their commission. Conveyancing firms could pass their fees and banks could start receiving interest on bonds which has been registered.

However, the deeds office only re-opened on the 13th of May after a public announcement by the Department of Rural Development and Land Reform on the 12th of May. The deeds offices awaited receipt of PPE’s (personal protective equipment) from the government and had to put measures into place for staff to safely return to work. Thereafter, the South African deeds offices closed several times to decontaminate the buildings where positive cases of Covid-19 were found. Besides, massive delays in the examination of deeds were caused by the fact that only a limited number of staff members were allowed back.

The Cape Town deeds office closed for a third time on the 14th of July due to another positive case of Covid-19. This causes further frustration for all parties involved. The turnaround time in the deeds office is usually 7 to 9 working days, but is now on 35 working days as a result of the nation-wide lockdown.   

Unfortunately, for parties involved in a property transaction during this pandemic, this is not the only issue. Transferring attorneys depend extensively on external institutions, such as SARS for the issuing of transfer duty receipts, and municipalities for the issuing of rates clearance certificates. These are required to be lodged at the deeds office in a property transaction. Currently, transferring attorneys are struggling to obtain these certificates timeously which causes further frustration.

The Municipal Systems Act provides that rates clearance certificates are only valid for a period of 60 days from date of issue. Matters which were ready for lodgment prior to the nation-wide lockdown, now require new rates clearance certificates as it has expired. All role-players involved in a property transaction, are required to do their part as effectively and swiftly as possible. This already complex process has become more challenging during the pandemic. Unfortunately, the situation is out of the control of anyone. Until measures are put in place to make a property transaction during COVID-19 more effective, we all have to endure the delays.

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