Changing Ownership of an RDP House

How to change ownership of a house in South Africa?

Changing the ownership of an RDP (Reconstruction and Development Programme) house in South Africa involves navigating a detailed legal process. This guide will walk you through each step to ensure compliance with all relevant regulations and avoid potential legal complications.

Read: RDP House Rules and Regulations

Step by Step Guide on Changing Ownership of an RDP House

Step 1: Verify Eligibility

The first step in the process is to verify that the RDP house has been owned for at least eight years. According to the Housing Act 107 of 1997, RDP houses cannot be sold or transferred within this initial period. This restriction is in place to prevent beneficiaries from selling their homes for quick financial gain and subsequently returning to inadequate living conditions. Ensuring that the eight-year restriction period has elapsed is crucial before proceeding with any sale or transfer.

Step 2: Gather Required Documents

Once eligibility is confirmed, both the seller and the buyer need to gather the necessary documentation. This includes valid identification documents such as ID cards or passports, the original title deed of the property, and proof of residence for both parties. If applicable, a marriage certificate and a divorce decree should also be provided to ensure that the property is free from marital claims. These documents are essential for verifying the identities of both parties and the legal status of the property.

Step 3: Obtain Clearance Certificate

The seller must obtain a clearance certificate from the local municipality. This certificate confirms that all municipal rates and taxes have been paid up to date, which is a prerequisite for the transfer of ownership. The clearance certificate ensures that there are no outstanding debts associated with the property, thereby preventing any future disputes or complications.

Step 4: Engage a Conveyancer

Engaging a qualified conveyancer is a critical step in the process. A conveyancer is a lawyer who specialises in property transfers and will handle all the legal paperwork. They will ensure that the transaction complies with all relevant regulations and that all necessary documentation is in order. The conveyancer’s expertise is invaluable in drafting a sale agreement that clearly outlines the terms and conditions of the sale, including the purchase price and any conditions precedent.

Step 5: Draft and Sign the Sale Agreement

With the assistance of the conveyancer, the sale agreement is drafted and reviewed by both parties. This agreement should detail all terms and conditions of the sale, providing clear guidelines and expectations for both the seller and the buyer. After thorough review and any necessary amendments, both parties sign the agreement, legally binding them to its terms.

Step 6: Pay Transfer Costs

The buyer is typically responsible for paying the transfer costs, which include the conveyancer’s fees and any applicable transfer duties. These costs must be settled before the transfer can proceed. Ensuring that these financial obligations are met is crucial for the smooth continuation of the process.

Step 7: Sign Transfer Documents

The conveyancer will prepare the necessary transfer documents, which both the seller and the buyer must sign. These documents formalise the transfer of ownership and must be completed accurately to prevent any legal issues. Signing these documents is a critical step that legally facilitates the transfer of the property.

Step 8: Lodgement with Deeds Office

The signed transfer documents are then lodged with the Deeds Office by the conveyancer. The Deeds Office is responsible for officially recording the change of ownership. This step is vital as it legally recognises the new owner of the property. Once the Deeds Office processes the transfer, a new title deed is issued in the name of the new owner.

Step 9: Post-Transfer Tasks

After the transfer is complete, the new owner should update their details with the local municipality to ensure they receive future municipal bills and notices. Additionally, it is advisable for the new owner to take out homeowner’s insurance to protect their investment. Ensuring compliance with local zoning laws is also important, especially if there are plans for renovation or development on the property.

Additional Considerations

It is important to remember that if the sale occurs after the eight-year period, the government retains the first right of refusal. This policy allows the government to repurchase the house and reallocate it to someone on the housing waiting list, ensuring continued support for those in need. For beneficiaries facing difficult circumstances, applying for social relief packages through the City can provide significant benefits, including a 100% rebate on assessment rates, free refuse removal, and allocations of essential utilities.

By following these detailed steps, you can navigate the process of changing ownership of an RDP house legally and efficiently. Always ensure that all transactions are properly documented and registered, and consider seeking legal advice to ensure full compliance with all regulations and to protect both parties involved.