Cape Town property Requirements for non-residents
Here are the facts as of the time of writing. You as a non-South African resident are entitled to own property/real estate in Cape Town and South Africa. This property may be registered in your own name or through your interest in a legal entity such as a Close Corporation, company or Trust. Properties are generally registered in or owned through such a legal entity for tax savings reasons, or asset protection. There are also various types of property ownership such as Leasehold and Sectional Title. It is therefore necessary to consult with an agent or financial advisor before embarking on a property purchase. You need a qualified Estate Agent Whether you are a non-resident or not, Cape Town property or property in South Africa should be purchased through a qualified real estate agent who is registered with the Estate Agents Board. There are various legal and financial formalities involved in property purchase in South Africa with which a qualified estate agent should be fully conversant. Non-Residents - Formalities If your normal place of residence or registration is outside of South Africa, you are unrestricted as to the amount of money you may bring in to the country. The proceeds of the sale of a property you own in South Africa may be transferred out of the country without restriction including interest or capital gain. Should you decide to raise a bond on a property in South Africa purchased for cash, this would be limited to 50% of the purchase price. You would be able to use such funds within South Africa but would not be allowed to transfer the funds out of the country unless the property is sold. When you invest in a property in South Africa and then decide you need to borrow money for improvements or renovations, then you are allowed to borrow to a maximum of 50% of the total projected cost of the investment, subject to repayment conditions set by the bank or financial institution concerned. You as a non-resident decide on the Cape Town property you want to buy and complete the relevant sales agreement. If you intend to apply for bond facilities it would be necessary to obtain a non-resident bank account at a registered financial institution to facilitate repayments. This process is completed only after your application is approved by the Reserve Bank. The financial institution concerned will provide a bond facility subject to proof of sufficient funding from abroad or provision of an occupational lease or rental agreement on the property concerned. If you make an application for permanent residence, any Cape Town property or other real estate assets you own in South Africa are taken into account when a decision is made.
Should you be interested in a particular Cape Town property or if you have a property enquiry you would like to make, please enter the relevant information in the form below and submit. It will then be forwarded to a property agent.
Your Privacy Any personal information you provide is treated as confidential. Your email address and any other contact details are used for communication purposes only in relation to your enquiry to this website and will not be passed on to any bulk emailing list, nor used for advertising or spam distribution. The Sale of your Property South African exchange control regulations determine the financial implications concerning transferring funds from a sale of property you have purchased in South Africa, to your place of residence. As these regulations are rather involved it would be advisable to speak to your banker or a financial adviser before drawing up a sales agreement. In order to legally transfer a property, an 'Offer to Purchase' comprising a Deed of Sale containing all relevant details about the property concerned, including the price, and information about buyer and seller has to be drawn up and signed by both parties. Here again, a financial adviser should be consulted. The change of ownership is carried out by a conveyancer (attorney) whose role it is to register the Deed of Sale at the applicable Registry Office. Costs of Transfer of Property - Usually borne by buyer Transfer Duty - Levied by Government. Based on purchase price. Variable from 1-8% on private ownership and 10% on legal entities. Transfer Costs - Charged by the transferring attorney. From 1-2% of purchase price. Mortgage Costs - For arranging finance. Based on a tariff system and paid to the registering attorney. Agents Commission - Usually included in sale price of property. Consult with your estate agent or financial adviser to facilitate the various financial obligations, which become applicable subject to the bond being raised by the bank, and the transfer of the property being registered. Financial Security Property transaction funds are transferred through the bank or financial institution concerned and held in trust by attorneys who are regulated by the Law Society. The attorneys are secured by insurance. Bank and financial institutions in South Africa are established and secure. Tax Requirements |