Carol Reynolds, Pam Golding Properties area principal in Durban, Durban North, La Lucia and uMhlanga.
Buying property is very exciting, but it can be a stressful experience for the parties if there is an issue with the building plans during the transfer process of the transaction, says Carol Reynolds, Pam Golding Properties area principal in Durban, Durban North, La Lucia and uMhlanga.
“Now, more than ever, we seem to be experiencing ongoing problems with building plans while the sales transaction is in progress,” she says.
In terms of the National Building Regulations, it is incumbent upon homeowners to ensure that all buildings are on plan and that said plans have been approved by the local authority. Several years ago, the Municipality would put a block on the issuing of rates clearance certificates if plans were not correct. This would result in extensive delays in the transfer process, as transfer cannot proceed without rates clearance.
“Unfortunately,” says Reynolds, “we are finding the same situation has re-emerged. We have had several transfers being held up because plans have not been fully complied with, and the Municipality has therefore refused to issue rates clearance certificates.”
“As it is the seller’s responsibility to ensure compliance with the Building Regulations, we advise all of our sellers to get their plans in order when they are contemplating placing their homes on the market. It is much easier to be prepared, than to be caught in the final stages of the transfer process and find you then have to quickly draft plans and submit these to the municipality at this late stage.”
She says one of the recent factors to keep in mind, is that energy regulations have changed. This means that buildings that would have been compliant several years ago may not be compliant in terms of today’s regulations. “For example, we have had several cases whereby sellers inherited properties and old outbuildings were not reflected on their plans. They are now being forced to submit plans for these existing outbuildings, only to find that they outbuildings do not comply with the new energy saving regulations. In some cases, sellers have had to add extra glazing, and so on, to ensure compliance.
“We have also had legal advice on this matter, as we have done our best to minimize stress for all parties concerned, and the advice we have received is that sellers cannot rely on the voetstoots clause to protect them in the event that plans are not correct. It is a statutory requirement to ensure that all buildings are legal, and hence the voetstoots clause cannot be used to condone illegal building works. The purpose of the voestoots clause is simply to protect the seller from latent and patent defects in the property, given that the property is a second-hand property and hence, will not be in perfect condition. Plans are governed by law, and therefore need to be complied with.”
“One solution that we find works best to assist the parties and facilitate the transfer process is for the attorneys to hold a retention until such time as plans have been approved. The attorneys then notify the Municipality that the seller has undertaken to submit plans, and that a portion of the proceeds will be withheld in trust until such time as the plans have been passed. The Municipality then issues the rates clearance certificate so that transfer can proceed.”
Reynolds says normally, body corporates and homeowners’ associations (HOAs) are very strict with plan compliance, which is positive from the perspective of ensuring overall compliance, but this too can frustrate the transfer process, as not only will the seller have to obtain municipal approval, but he/she will also be required to obtain consent from the HOA or body corporate.
“Ultimately, we are finding that our role as estate agents has extended beyond a sales and marketing function into the realm of offering advice and facilitating compliance with building regulations. It is a difficult predicament to be in, because issues over building plans can impact negatively on an otherwise happy transaction between buyer and seller. The best way to maintain positive relationships is for sellers to accept responsibility and perform their best endeavours to ensure compliance as expeditiously as possible, and for purchasers to allow the process to follow its course, without making additional demands on the seller,” says Reynolds.
Finally, and while on the topic of building regulations and planning, of interest is that this month (July 2015), SALGA (South African Local Government Association) introduced the Spatial Planning and Land Use Management Act (SPLUMA) of 2013, which aims to provide for the inclusive, developmental, equitable and efficient spatial planning at different spheres of government. While addressing the legacy of past spatial planning and regulatory imbalances, objectives also include promoting greater efficiency, consistency and uniformity in decision-making by authorities responsible for land development decisions.