Pick up a holiday haven for a song
Advice to World Cup visitors contemplating buying property in SA
SOUTH AFRICA is one of the easiest countries in the world in which foreigners can buy residential property, says Lanice Steward, managing director of Anne Porter Knight Frank.
“Unlike in many other countries, the red tape and restrictions are minimal and the SA Reserve Bank allows you to repatriate your money if and when you decide to sell. South Africa does list overseas buyers as non-residents unless they take out SA citizenship – but it is exceptionally accommodating to them.”
She offers some advice and information for foreigners who become South African property owners: if you are paying with cash, you must ensure that you have your own copies of the title deeds and financial documents and that these are stored in a safe place. They will have to be produced if you choose to sell and repatriate your money.
Overseas buyers are allowed to take out South African mortgages, but only up to 50 percent of a property’s value.
The rest has to be paid in cash or by means of a second bond taken out in the buyer’s home country.
In South African property law, a signature on a contract is totally binding. This is not the case in some other countries, particularly if the seller gets a better offer. But in South Africa, once a contract has been signed, it cannot be changed without the consent of both parties.
South Africa also differs from certain other countries in that estate agents are authorised to draw up sale agreements, which are then to sent to the seller’s at torney /con-veyancer for processing.
Most South African property is bought in the individual’s name but buyers have the option of buying by means of holding vehicles such as trusts, close corporations or compa--
‘Unlike in many other countries, the red tape and restrictions are minimal’
nies. Whatever method they choose, buyers or their holding vehicle will have to obtain tax numbers from the SA Revenue Service to buy or sell property.
Any foreigner selling a South African property will pay capital gains tax on the same basis as a South African (that is, on a pro-rata basis in relation to total tax).
Steward says South African property can still be had for an almost ludicrously low outlay when bought with European or US currencies.