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What is the process of transferring a house to a family member?

It may bring you some comfort and satisfaction to know that your child will be have the financial and psychological security that a home provides. As such, you can transfer a property to your child’s name in the form of a gift, instead of making it part of your inheritance.

Gifts (treated by SARS as donations) are taxed differently to inheritance. According to SARS; since 1 March 2018, “donations tax is levied at a rate of 20% on the aggregated value of property donated not exceeding R30 million, and at a rate of 25% on the value exceeding R30 million”.

The process is also different from that of bequething a property. It involves the following steps:

  • Bond cancellation. If there is an outstanding bond on the property, it will need to  be settled, or cancelled. This requires the hiring of a bond cancellation attorney, who will charge a fee payable by the current home owner.
  • Transfer of property. The process of transferring the property to the new owner incurs a transfer of property cost, payable to the conveyancing attorney.
  • Transfer duty is payable on property transferred as a gift, though only if the property is worth more than R1 000 000.
  • Bond registration. A bond attorney will need to register the bond under the name of the new owner, which incurs a bond registration fee.

So it’s similar to the process of purchasing a home, unless the bond is already paid, in which case only a fee for the transfer of property will be required.

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Ooba home loans services are simply the best. My Consultant Bianca Dancer was so hands on and helpful from the get go. She guided me through the entire process and put me at ease being a first time buyer. I highly recommend their services.

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Excellent Service

Jay Govender and Maleshini Reddy from OOBA provided outstanding assistance and guidance in securing our home loan. Response times were excellent and they were professional and friendly.

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Bond Application

Estelle Vorster was really helpful in securing the best deal for my home loan, she not only negotiated a lower interest rate she went as far as securing 50% discount on the transfer costs.

Butana M