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Taking occupation of a newly acquired property

One of the most important decisions to make when signing an offer to purchase, is the date when the purchaser may take ownership of the keys and move in.

The parties may either agree on occupation at registration of transfer or on a specific date.

The most common option is to agree to take occupation at transfer because sellers want the comfort of receiving the purchase price before handing over the keys.

If occupation is taken prior to registration of transfer, an additional clause may be included in the sale agreement to the effect that the purchaser must provide proof that he/she has funds to pay the transfer and bond costs by a certain date.

Furthermore, sellers do not want to give purchasers the opportunity to discover defects in the property before transfer. The seller will have a better chance of negotiating or disputing claims for the repair of defects, if the buyer only occupies after registration of transfer.

A Property Disclosure Report which the seller provides and signs, should give the purchaser peace of mind.
This report may be downloaded from our website www.wkh.com.
Purchasers should, however, still conduct their own investigation and bear in mind that they will only be able to ascertain all details of the property after transfer.

Occupation on the exact date of registration of transfer is difficult as no-one has absolute control over that date.
In either options, it is important to agree on occupational rent in the contract in order to avoid disputes between parties when occupation is taken by either party.

The advantage of an early occupation date before transfer will speed up the transfer process because the buyer and seller will get their paperwork in order much earlier than they would otherwise.

The conveyancer’s turnaround time is directly dependant on how quickly the buyer and seller comply with their contractual obligations.

If sellers make an effort to repair all defects upfront, the transfer will be quick and trouble free. Sellers should be honest and disclose defects they are aware of at the time of concluding the sale. Buyers should be advised to do a rigorous inspection of the property and may even ask experts to inspect the property before signing contracts.

If defects are discovered before transfer, there is time enough to have them repaired or at least agree to a provision that the cost of repair can be deducted from the selling price and retained until liabilities are determined.

Occupation before transfer will accelerate registration of transfer of ownership.

If sellers properly disclose all defects in the Property Disclosure Report, an occupation date before transfer and stipulated in the contract, is clearly the best option.