Property Terms / Jargon Explained:
Navigating the property market in the East Rand can feel like learning a new language. Whether you are looking for a family home in Benoni or selling a townhouse in Boksburg, understanding the local real estate jargon is the first step toward a successful transaction. At Monarch Properties, we believe that an informed client is a confident one. This guide breaks down the most critical terms you will encounter during your journey.
Asking Price
This is the initial value placed on a property by the seller, usually based on a professional market analysis of similar homes in the East Rand area. Depending on current demand in suburbs like Kempton Park or Edenvale, buyers may offer the full amount or negotiate a different price.
Bond Originators
A bond originator is a professional service that helps buyers secure the best possible home loan rates. They handle the applications to multiple banks on your behalf, which is a significant time-saver for busy professionals.
Deposit
While not a legal requirement, providing an upfront cash payment—typically around 10% of the purchase price—can make your offer stand out to sellers. It demonstrates financial stability and often assists in securing the balance of your home finance.
Interest Rates and the Prime Lending Rate
When you take out a home loan, the interest is usually linked to the Prime lending rate. Your specific credit profile determines whether the bank offers you a rate at, above, or below Prime.
Legal Processes and Documentation
Conveyancer
Also known as a transferring attorney, this legal expert manages the complex paperwork and formal processes required to move the property title from the seller’s name to the buyer’s name.
FICA Compliance
The Financial Intelligence Centre Act (FICA) is a critical piece of legislation designed to prevent financial crimes like fraud and money laundering. In every property deal, estate agents and attorneys must verify the identity and residence of all parties involved. Be prepared to provide your ID, proof of address, and tax information.
Zoning Permissions
Zoning refers to the legal purpose of a piece of land as defined by local East Rand planning authorities. This determines whether a property can be used for residential, commercial, or mixed-use purposes.
Understanding Value and Ownership
General Valuation Roll
This is the municipal document that lists the value of every property in the region. Local councils use these figures to calculate your monthly rates. It is vital to check these rolls when they are released to ensure your property isn’t overvalued.
House Price Appreciation
This term refers to the growth in property value over time. Understanding the average appreciation in specific East Rand neighborhoods helps sellers set fair prices and helps buyers identify strong investment opportunities.
Sole Mandate
A sole mandate is a formal agreement where a seller grants one specific agency the exclusive right to market and sell their home for a set period. This often leads to a more focused marketing strategy and clearer communication.
Turn-key Property
In the local market, a “turn-key” home is one that is completely ready for occupation. There is no need for renovations or repairs; you can simply move in and start living from day one.
Unconditional Offer
This is an offer to purchase that does not rely on any outside factors, such as the buyer selling another house first or waiting for a bond to be approved. These are highly attractive to sellers because they offer the most certainty.
Understanding the Voetstoots Clause
The term voetstoots is a Dutch word that literally translates to “as it is pushed with the foot.” In the context of an East Rand property sale, it means the buyer is purchasing the home exactly as it stands—with all its existing faults and merits.
Why Voetstoots Matters to You
In a standard Offer to Purchase, the voetstoots clause protects the seller from being held liable for defects that are discovered after the sale is finalized. However, this protection isn’t absolute, and both parties need to understand their rights.
Patent vs. Latent Defects
To understand how voetstoots works, you must distinguish between two types of property flaws:
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Patent Defects: These are obvious flaws that any person would notice during a reasonable inspection, such as a cracked window, a missing tile, or a large damp stain on a wall. Because these are visible, the buyer is expected to see them and factor them into their offer.
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Latent Defects: These are hidden issues that a regular inspection wouldn’t necessarily reveal, such as a leaking roof that only shows during heavy East Rand summer storms, or structural foundations that are failing behind a fresh coat of paint.
The Seller’s Duty of Disclosure
While the voetstoots clause protects sellers, it is not a “get out of jail free” card. South African law (specifically the Property Practitioners Act) requires sellers to provide a Mandatory Disclosure Form.
If a seller knows about a latent defect (like a crack in the swimming pool) and intentionally hides it from the buyer or the Monarch Properties agent, they cannot rely on the voetstoots clause for protection. If the buyer can prove the seller knew about the flaw and stayed silent to secure the sale, the seller could be held legally and financially liable for the repairs.
Professional Inspections: Your Best Defense
In a competitive market like the East Rand, buyers are often tempted to skip a professional inspection to move faster. However, because of the voetstoots clause, we highly recommend hiring a professional inspector before signing an unconditional offer. Knowing the true condition of the home ensures that “as is” doesn’t turn into a costly “oops” later on.
Occupational Rent
In the East Rand, moving dates don’t always align perfectly with the date the property is officially registered in your name at the Deeds Office. Occupational Rent is the amount paid by the person living in the house to the person who technically owns it at that moment.
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Scenario A: You move into your new Benoni home before the transfer is finished. You pay the seller occupational rent.
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Scenario B: The transfer goes through, but the seller needs to stay in the house for two more weeks to finish their move. The seller pays you occupational rent.
Pro Tip: This amount is usually agreed upon in the Offer to Purchase (OTP) and is often calculated to cover the owner’s bond repayments.
Sectional Title vs. Freehold
When browsing listings in Boksburg or Edenvale, you’ll see these two types of ownership:
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Freehold (Full Title): You own the house and the land it sits on. You are responsible for everything—rates, taxes, and that garden fence.
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Sectional Title: You own a “section” (like a townhouse or apartment) and a share of the common property. You pay a monthly Levy to a Body Corporate, which covers building insurance and maintenance of shared areas like pools or security gates.
