Your lockdown property questions answered

Your lockdown property questions answered

Private Property South Africa

The experts answer your frequently asked property-related questions for the Covid-19 lockdown.

There is something poetically beautiful yet daunting about the entire world going through this unprecedented time, says Mike Greeff, CEO of Greeff Christie’s International Real Estate. As frightening as what the COVID-19 is, it is also proof that we can all come together and unite. During this time, you will find experts giving advice, health workers doing their very best to heal those in need and everyone just going the extra mile to make sure that their fellow neighbour is taken care of.

In the spirit of helping each other, we would like to do our part in answering some property-related questions that you might be having. We are all trying to navigate our way through this pandemic, and it is important to note that the information we are supplying is relevant for now – things are constantly changing and with that, information too.

Greeff says that the national lockdown has left many ‘’property buyers, sellers, tenants and landlords seeking answers about how they should proceed over the 21-day period.

Below are a few of your FAQ’s:

Q: What happens if I was planning on moving?

A: ‘’No one is permitted to move during lockdown so you will have to stay put’’ says Junel Hickman, Associate - Attorney, Notary and Conveyancer at STBB. Once the lockdown has been lifted, people can move. There are no transfers taking place in any way, so it would come down to agreement between the parties regarding occupation and occupational rent, if applicable.

Q: If a seller decides he no longer wishes to sell, is it possible to cancel the deal? Same with a buyer who no longer wishes to go through with the purchase?

A: No – it is still a valid and binding agreement says Hickman. If there are financial issues, it may constitute a breach or, if the Agreement was subject to a bond, the bond may possibly be turned down and the agreement would be void. If the bond was already granted, it would again be a breach of the agreement if the bond is revoked due to changes in financial circumstance. However, Greeff advises that ‘’if both parties wish to cancel the deal, it can be done through a cancellation agreement’’.

Q: Can all the necessary paperwork be done digitally so when the lockdown is lifted, everything is in place?

A: Hickman advises that documents in property transfers cannot be signed digitally as per the Alienation of Land Act. ‘’Agreements of sale cannot be signed digitally but have to be printed and signed but scanned copies are acceptable’’. Powers of Attorney also cannot be signed digitally, and we require the original in order to lodge. Bond documents also have to be physically signed in front of an attorney.

Q: Are there any legalities people should consider during this lockdown that’s property-related?

A: If there are transfers pending, it is important that sellers keep the property well-maintained and in the same condition as at date of sale (applies at all times, not just lockdown) but access to garden services, pool services etc, is limited. If something happens to property which can only be attended to after lockdown, the seller must disclose this and ensure it is attended to promptly.

Q: What happens if a lease for a residential property is about to or has already expired during the lockdown?

A: Mark Burt, Rental Manager at Greeff Christie’s International Real Estate says that due to the imposed lockdown, tenants and landlords ‘’have their hands tied and both parties could find themselves unable to perform their respective legal duties’’.

Burt adds that no one is permitted to move in or out of a property during lockdown so in essence, tenants will have to remain on the property where they presently reside and will be liable to pay rent pro rata. The same applies if you are moving into a new property, however you will not be liable for rent due at the new property as everything is frozen until after lockdown.

Q: Can a tenant use the security deposit to pay for the pro-rata rent for a residential property?

A: Many tenants have this misconception they have the right to tap into their deposits held in trust (during this time) says Burt. Unfortunately, these are damage deposits held for a very specific purpose and are regulated under most leases and current legislation. Greeff cautions that ‘’using your security deposit for rental is not allowed and should be outlined in most leases’’.

Q: Are there any rules I should adhere to if I live in a complex?

A: The South African Police Service (SAPS) has said that ‘’residents who live in a complex or estate are urged to adhere to the lockdown rules i.e. staying indoors’’. When the lockdown was implemented, jogging and walking the dogs were prohibited and this extends to those residents living within a gated estate or complex. Greeff says that the main purpose of the lockdown is to ‘’reduce the number of people outside in order to prevent the spread of the virus’’ so by being outside, within your estate or complex, defeats the purpose of the lockdown.

Q: If I was looking to buy a home, should I stop my search until the lockdown is over?

A: This is the ideal time for aspiring buyers to start or continue looking because of the 1% drop in the repo rate says Greeff. The repo rate cut means buying a home is more affordable and more attainable, especially for first-time buyers. ‘’The Covid-19 pandemic should not deter potential buyers from looking because they can still do so from the comfort of their homes’’ continues Greeff.

South Africans are a resilient people and we have come together not only to fight this virus but to get together as one united front. “These unprecedented times can cause fear and panic, but I believe they will also provide a fantastic opportunity for innovation, and there will still be deals done as people look for normalcy”, encourages Greeff.


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