Buying Property in South Africa

Buying property in South Africa has been a popular investment choice for overseas property buyers for years – British and German buyers in particular have been attracted by modest prices, glorious climate and the sheer variety of property in South African available.

With a flight time of around 12 hours from the UK, buying property in South Africa is not a realistic weekend getaway but ideal for longer holidays and there’s always the option of short-term lets to other holidaymakers when you’re not there. There are few restrictions on foreign property ownership and mortgages are freely available locally and in the UK for buying property South Africa.

Buying retirement property in South Africa is a great idea – the country is English-speaking, warm and sunny and with a low cost of living. Cape Town, for example, is a safe and clean city with bags of culture and a high standard of living, set against the spectacular backdrop of Table Mountain and within easy striking distance of the vineyards of the country’s winelands. George and Port Elizabeth, on the beautiful Garden Route, are other popular destinations. However, they are also in the upper price range of property hotspots in South Africa.

For an equally sought-after slice of South African real estate, why not look at subtropical Durban, a vibrant city on the country’s eastern seaboard, not far from the border with Mozambique.  More adventurous property buyers should look inland in a number of regions at farms and rural estates at a fraction of the price of the UK equivalent.

Whatever your preference, buying property in South Africa is affordable, high quality and accessible, and well worth a look from overseas property buyers.

Key Facts
Population: 43,786,115
Capital: Pretoria
Languages: English and 10 others, including Afrikaans
Area (km2): 1,219,912 
Currency: rand
Exchange rate: £1 = R15
Dialling Code: +27
Emergency services: 112
Embassy in UK: http://www.southafricahouse.com

Health
There is a national health service in South Africa; however this tends to be overused and under-resourced, so it is very advisable to take out private healthcare. No vaccinations are currently required before travelling

Travel
There are regular direct flights to major South African airports from London Heathrow. Flights take around 12 hours. Fortunately, though, there is only a one-hour time difference with the UK, so jet lag shouldn’t be too much of a problem

Visa/residency issues
No visa is required for any UK citizen spending up to 90 days in South Africa. Beyond this, a number of different visas are available to Brits, but these really depend on your requirements. Be aware that the visa application process can be quite lengthy, but once the correct visa has been selected it is pretty straightforward

TOP TIP
It is not unusual for transfer to take three months or longer to go through, and if a buyer moves in before transfer is complete he/she will have to pay ‘occupational rent’ for this period. So wherever possible, allow for delays when planning a move


The process of buying property in South Africa

• There are no restrictions to foreigners owning property in South Africa. The process is pretty straightforward and buyers can purchase as individuals or set up a company – both methods bring certain advantages
• If needed, non-residents are allowed a mortgage of up to 50% of the purchase price, which is relatively straightforward to obtain
• When a suitable property has been found, and a price agreed, the buyer must either make an official written offer to purchase or sign a deed of sale. Both of these documents are legally binding and they will both outline all the conditions of the sale, including the completion date. At this point a deposit of 10% is usually paid
• The outstanding balance is paid to the conveyancer just before the completion date (so that it is ready to be transferred to the vendor on completion) at which point title is transferred into the new owner’s name
• Be sure to check the state of the property before signing on the completion date: the voetstoots clause states that properties are sold “as they are” on this day. Anything later found to be wrong becomes the buyer’s responsibility to sort out

Fees and taxes

• Transfer tax varies up to 8% of the purchase price on a sliding scale – the first R150,000 (£9,600) of the purchase price is exempt. If buying through a company, a flat rate of 10% transfer tax applies
• Local taxes are also applicable, but these vary greatly depending on the region
• Agents’ fees are usually around 5% and legal fees tend to amount to between 1% and 2%
• Capital gains tax is levied at 25% for individuals and 50% for companies. The first R1 million (£64,000) is exempt if the property is a primary residence

• Property investment in South Africa

and our overseas property news affecting the property market in South Africa or view our range of property in South Africa.