Author: Nicolas Nel
A title deed as described in the Deeds Registries Act 47 of 1937 serves as proof of ownership in immovable property in South Africa and includes all the important provisions relating to the specific property. Although it is not always possible to view the original title deed when signing an offer to purchase, it would be prudent to request to see a copy of the original.
Titles deeds contain the following standard provisions:
- A description of the property, indicating its exact size
It would be important to compare this description and size against the offer to purchase before signing. You do not want to be put in a situation where you signed an offer to purchase only to realize the property is smaller than advertised. Although there is a possibility for legal recourse in these circumstances, it can be avoided altogether.
- The name and identity number of the person or persons who legally own the property
Knowing who the legal owners are enables you to confirm that you are indeed purchasing from individuals with authority to sell the property. For example, in the case where there are two owners, both parties would need to consent to the sale.
Although the transferring attorneys would be able to pick this up on there side, by checking the title deed early on, time and money can be saved.
- The date the property was last transferred as well as the purchase price thereof
Knowing the history of the property could indicate whether you are getting good value for money. This is potentially helpful in situations where the property was purchased recently, renovated, and sold on again.
- Any restriction over the property
Here it would be possible to see whether the property is governed by a Home Owners Association (HOA). Further one would be able to see whether there are any real right restrictions, such as a servitude registered over the erf.
HOA’s usually place rules and certain restrictions on the usual rights associated with ownership of a property. A popular example would be the color you are permitted to paint your home. If the property is governed by an HOA, it would be advised to request a copy of the HOA’s Memorandum of Incorporation. This memorandum outlines the set of rules, policies and procedures with regard to the property.
A simple example of a servitude, on the other hand, would be a right of way. A right of way allows a third-party rite of passage across your erf, this may be important to note as it can diminish the value of the property.
Purchasing a property is for many the biggest financial decision they will make in their lifetime. To make the process less daunting, it would be prudent to request a copy of the title deed. Should anything be unclear on the Title Deed, adequate advice should be requested before signing the legally binding offer to purchase.