This is what it costs to buy a R2m home in South Africa
It is no secret that buying a home is one of the biggest financial commitments you will ever make in your life, but along with the costs of the physical home there various other fees and charges to keep in mind too.
Steve van Wyk, Seeff’s MD in Centurion, lists the following main costs of buying a R2m home.
- 10% deposit: R200,000
- Transfer duty to SARS: R60,500
- Conveyancer fees: R25,380
- Postages and petties: R977,50
- Deeds office transfer levy: R1,098
- Electronic document generation fee: R747,50
- Deeds office search fee: R241,50
- Local council rate clearance: R345
- Deeds office levy fee: R1,098
- Initiation fee: R5,250
- Attorney bond and registration cost: R23,910
- Postages and petties and VAT: R977,50
- Electronic generation fee: R1,092
- Another small cost to bear in mind is an electricity connection fee of around R600 to R1,200
- Water connection fee: R470
Also keep in mind that VAT needs to be added to the above amounts.
- Monthly repayments of the bond. At the current interest rate the monthly repayment of a bond of R1,8m will be around R17,670
- Bond monthly admin service fee: R69
- Homeowners insurance: Banks usually add this to the mortgage amount to protect themselves against claims for flood, fire and hail damage.
- Insurance on the owner’s life. This is to cover the cost of the property in case of death. The policy will not only cover the outstanding loan amount to the bank, but will also ensure that any dependants have a roof over their head at the time of death.
- Rates and taxes: due to the municipality for rubbish removal and the maintenance of your area.
- Water and electricity: due to the municipality for your household’s monthly consumption.
Van Wyk concludes that any prospective home buyers should carefully look at their budget and expenses before considering the big step of purchasing property.
“A realistic budget is extremely important before embarking on this journey,” he says.