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Understanding Open or Sole Mandates

When it comes to selling your property, which is better; open mandate or sole mandate?

A mandate is the instruction to a real estate agent with regards the commission. When a seller instructs an agent to sell his property for commission and the agent agrees, a mandate has been formed.

The question then arises as to whether a seller should use more than one real estate agent in order to sell their property faster. There are pros and cons to whichever choice you make.

Open mandate

If your property is listed as an open mandate, this means that any agent who has received a mandate from the seller may market and sell the property in exchange for commission. A seller in their private capacity may also attempt to sell the property. If a property is open mandate, no agent may claim the sole right to sell and market the property.

With so much competition to sell the property, most agents will be incentivised to sell the property at a lower price, just to make the sale. The sale may often be rushed and low-profit which is not great for the seller.

There is also such a thing as ‘double commission’ whereby it is not clear to determine which agent effectively made the sale. Most agents will not go all out and advertise a property that is under an open mandate.

Sole mandate

As the name suggests, no one except the seller and the sole agent may market and sell the property. This gives a focused point of authority but unfortunately means that the house may take longer to sell.

A plus for the real estate agent is that whether the seller sold the house or not, they will receive commission. It is usually the agent who makes the sale anyway, but this is a nice perk. A sole mandated real estate agent may also informally share the listing with other trusted real estate agents for a cut of the commission. Do not fret; you will not have to pay double commission should another real estate agent make the sale, nor will you receive increased communication from other agents – you will still only communicate with your sole real estate agent.

One or many real estate agents?

So which one should you choose to sell your property? This can depend on certain circumstances. Do you need to sell the property immediately? Or do you have time to wait for the price you would like in order to make a comfortable profit?


A sole mandated listing saves you from having to pay double commission when it is not certain which real estate agent as in fact responsible for the sale. Likewise, if you make the sale in your private capacity (a rarity) you will still need to pay the real estate agent commission for all their efforts in marketing, show days and appointments in order to sell your property.

A real estate agent can market from anything from a couple days to two years, so ensure that you do your homework when selecting a real estate agent. Great real estate agents give your listing maximum exposure and waste no time in getting people through the doors to view your property.

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What is the voetstoots clause?

Most property buyers and sellers have a rather vague idea of what the voetstoots clause means and how it applies to them. This can lead to disputes if the parties don’t realise how it affects the offer to purchase and other property transaction documents.

What is the voetstoots clause?

In South African law the voetstoots clause is a standard term inserted into real estate – and many other – sale agreements. It says that the purchaser is buying the property or other item as it stands, whether or not it has patent or latent defects.

Patent defects refer to defects that are openly seen, discovered, or understood to be defects, whereas latent defects refer to hidden or dormant defects. Latent defects are more contentious because they often require a trigger to bring it to one’s attention, for instance roof damage that only becomes obvious after a bad storm.

The clause protects sellers in the event of latent defects coming to light after the transaction has been concluded. However, whether defects are patent or latent, if sellers know about them, they cannot use the voetstoots clause to protect themselves against repairing them or disclosing them to the buyers.

Sarah-Jane Meyer  says the voetstoots clause still applies to property transactions when the seller’s ordinary course of business is not property, such as individuals who are selling their own houses or apartments.

Common issues

Sellers are required by law to disclose any latent property defects they are aware of. For the voetstoots clause to be set aside, buyers would have to prove that the sellers knew of the latent defects and deliberately concealed them with the intention of defrauding the buyers.

However, it can be very difficult – and costly – trying to prove that sellers deliberately withheld the information if problems are only discovered after the sale has already been concluded.

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Valuations vs Surveys

Buying a house… is a valuation sufficient, or should you opt for a full structural survey?

Buying a house is probably the biggest financial purchase you’ll make in your lifetime and at a time when you’re already spending a lot of money, a survey can sometimes seem like a big expense. However, knowledge is power and it’s better to be informed of any potential issues before proceeding with the purchase otherwise it may end up costing you further down the line.

When you’re at the exciting stage of buying a new property it’s easy to get seduced by the appearance of your potential new home, and risk ignoring any hidden problems which could cost you later on.

That’s where a survey can give you peace of mind to purchase your new home with confidence. But with a number of options available, which is the best type of survey for the property you’re buying?

Mgilija Properties has summarised the different types of surveys available to help you make an informed decision:

A summary of surveys
The type of survey you should go for depends a lot on the age and location of the property. For example, if you’re buying an older property it’s sensible to select for a more detailed report than perhaps someone who’s buying a new-build.

Basic mortgage valuation
The sole aim of the basic mortgage valuation is to satisfy the lender that your chosen property is worth the price you’re paying before they approve your mortgage. It doesn’t go into any detail on the state of the property.

It’s important to remember that this survey is for the benefit of your mortgage lender and doesn’t provide you with any guarantees about the state of the property.

Homebuyers report
This is a detailed report for ‘standard’ properties which are in reasonably good condition. It provides a more in-depth inspection that will help you find out if there are any structural problems, such as subsidence or damp, as well as any other hidden issues – inside and outside the property. It will also give advice on any defects that may affect the value of the property, along with recommendations for repairs and ongoing maintenance.

A homebuyers report excludes the cost of estimates for repairs.

Full structural survey
Now known as a Building Survey, this is a comprehensive report providing a full breakdown of the fabric and condition of the property, with diagnosis of defects and repairs and maintenance advice. Typically these types of surveys are more suitable for properties that are listed, have an unusual construction, or require significant renovation.

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Valuations vs Surveys

Buying a house… is a valuation sufficient, or should you opt for a full structural survey?

Buying a house is probably the biggest financial purchase you’ll make in your lifetime and at a time when you’re already spending a lot of money, a survey can sometimes seem like a big expense. However, knowledge is power and it’s better to be informed of any potential issues before proceeding with the purchase otherwise it may end up costing you further down the line.

When you’re at the exciting stage of buying a new property it’s easy to get seduced by the appearance of your potential new home, and risk ignoring any hidden problems which could cost you later on.

That’s where a survey can give you peace of mind to purchase your new home with confidence. But with a number of options available, which is the best type of survey for the property you’re buying?

Mgilija Properties has summarised the different types of surveys available to help you make an informed decision:

A summary of surveys
The type of survey you should go for depends a lot on the age and location of the property. For example, if you’re buying an older property it’s sensible to select for a more detailed report than perhaps someone who’s buying a new-build.

Basic mortgage valuation
The sole aim of the basic mortgage valuation is to satisfy the lender that your chosen property is worth the price you’re paying before they approve your mortgage. It doesn’t go into any detail on the state of the property.

It’s important to remember that this survey is for the benefit of your mortgage lender and doesn’t provide you with any guarantees about the state of the property.

Homebuyers report
This is a detailed report for ‘standard’ properties which are in reasonably good condition. It provides a more in-depth inspection that will help you find out if there are any structural problems, such as subsidence or damp, as well as any other hidden issues – inside and outside the property. It will also give advice on any defects that may affect the value of the property, along with recommendations for repairs and ongoing maintenance.

A homebuyers report excludes the cost of estimates for repairs.

Full structural survey
Now known as a Building Survey, this is a comprehensive report providing a full breakdown of the fabric and condition of the property, with diagnosis of defects and repairs and maintenance advice. Typically these types of surveys are more suitable for properties that are listed, have an unusual construction, or require significant renovation.

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Landlords: Your Student Accommodation Checklist

Pivoting your investment property towards providing student accommodation could prove very lucrative. Here’s how to get it right.

Student living

Think back to your tertiary education years, and you might consider them the best years of your life. Filled with learning, new experiences, friends, and fun, living the student lifestyle is one that you remember with fondness. You remember the all-night cram sessions and camaraderie over late-night pizza. Now that you’re older, wiser, and have used your knowledge to invest in property, you’re considering creating that environment for our country’s future leaders.

Investing in student accommodation

Off-campus, privately-owned student accommodation is a huge attraction for students. Free of the on-campus rules and regulations, students are keen to start their student life with the right type of facilities at home. This type of property is always in demand, so if you’ve bought an investment property that’s situated close to a tertiary education facility, you could create a good source of income for yourself. Alternatively, if you’re considering taking the leap into being a landlord, here’s how to get it right.

Play by the rules

Before you make that purchase, or adapt your investment property towards student accommodation, make sure your property is correctly zoned and has adhered to the right regulations in terms of facilities too. Your ability to turn your investment property into student accommodation will also be affected by your neighbouring properties, so make sure there have been no objections to your plans. It’s also a good idea to speak to your nearby tertiary education institution’s student housing office, and enquire about getting listed on their student accommodation database. They can be a great resource for finding out more about their students’ needs.

Converting your property

Turning your property into the ultimate student home will take some work. You may need to add a bathrooms, sub-divide rooms, or extend your property. Before you start planning that funky mural, and installing a pool table, decide how many people your property will accommodate, and build accordingly. Overcrowding is all too common in student accommodation facilities, and could land you in trouble with the law, so don’t be tempted to take on more students that you can.

Insuring your property

According to privateproperty.co.za, don’t forget: when you’re all set up and ready to welcome your first student tenants, you’ll need to update your property’s insurance policies. Chat to your financial advisor or insurance broker about your additional insurance needs.

Get your property student-ready

Location is a life essential when it comes to student accommodation. Make sure your property is situated along, or near to, public transport routes. If your investment property is a house, then creating common living areas, including a TV lounge, dining area, and perhaps a ‘chill spot’ is important. Make sure each room is equipped with at least one desk per student, and allows for everyone to enjoy some quiet time when they need to study. Of course, it’s 2019, and none of us could survive without WiFi. Invest in the highest speed internet connection you can, and ensure your network can easily sustain your residents’ needs.

The bonus features

Turning your investment property into the ultimate student abode will mean adding in a few bonus features. If it’s possible for you to add in selected extras, you will be able to demand a higher rental amount from your tenants. Consider adding in-house catering facilities, a swimming pool, or other recreational facilities, if you can.

Keeping an eye on things

As a landlord, you are legally responsible for maintaining the property, and ensuring that all rules and regulations are adhered to by your student tenants. Respond to their enquiries promptly, and deal with complaints as quickly as possible. Don’t forget to conduct regular property inspections, once you’ve arranged a convenient time and date for your tenants.

Mgilija Properties can assist with advice on how to go about with such management

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Does paying E100 extra on your home loan matter?

The substantial amount of debt owed on a home loan can often startle consumers making it seem pointless to pay anything extra, as it may take decades to settle the amount outstanding.

By paying E50 extra on a E500 000 Home Loan on a 10.25% interest rate for 20 years, you will be able to pay off your home loan in 19 years and three months, while saving over E26 111.86 in interest that you would have paid to the bank.

Dr Simphiwe Madikizela, says what many consumers don’t realise is that even paying as little as E50 extra on your bond, you can immediately start saving on interest.

By paying E50 extra on a E500 000 Home Loan on a 10.25% interest rate for 20 years, you will be able to pay off your home loan in 19 years and three months, while saving over E26 111.86 in interest that you would have paid to the bank.

He says that in order to understand the impact of extra payments, consumers should first be able to distinguish between payment towards their principal debt as well as interest paid on the principal debt.

For a home loan, the first payment you make would typically be paid towards interest. However, any extra payment you make enables you to lower the principal debt owed. As the principal debt decreases, so does the amount of interest you have to pay.

Madikizela demonstrates the impact of making an additional payment, every month, on a E500 000 home loan at an interest rate of 10.25 % for 20 years:

Recurring extra payment monthly Years to be paid off Savings on Interest
E100 18 years and 8 months E49 933.77
E200 17 years and 7 months E91 913.82
E300 16 years and 8 months E127 859.91
E400 16 years E159 093.56
E500 15 years and 3 months E186 545.30
E600 14 years and 6 months E210 921.07
E700 14 years E232 744.92
E800 13 years and 5 months E252 426.89
E900 13 years E270 280.29
E1000 12 years and 5 months E286 571.73

“You should also consider topping up your extra payments with a lump sum, either from your bonus or tax refund, etc. This will significantly reduce your interest over the loan period.

“Being aware of the impact of making extra payments will help you manage your bond repayments and ultimately ensure that you pay off your bond as quickly as possible,” says Madikizela.

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How to spot a property bargain in Eswatini

There are many factors besides price that astute buyers will consider before investing in property. Here are 6 factors to keep in mind.

Fortunes have been made by investing in property but, and there is a very big but, generally it’s only those who truly know how to capitalise on a situation that make pots of money.

So what is the secret to buying property at a bargain-basement price and more importantly, does it mean you’re guaranteed to make money simply because you managed to snap up a home for what you consider a ridiculously low sum? The short answer is no. There is so much more to buying a property than price, and there are several other important things to take into account before signing a sales agreement.

Research

It is vital to have a good understanding of the market you are buying into. Markets change from area to area and sometimes even from street to street. Don’t rush into something simply because the deal looks good – take a long hard look at the area, investigate what’s been sold there and at what price and then make an informed decision. Demand drives prices, so buying a property with a rock-bottom price tag in some far flung area where the demand is low will probably come back to bite when it comes time to sell. At the same time, expecting to make a serious profit from a sale in an area which has a glut of properties on the market could also backfire and you could end up losing out. Consult with local estate agents in order to get a clear picture of the local market conditions and only invest once you have all the facts at your disposal.

Keep your eyes peeled

Bargains come onto the market every day and are generally snatched up quickly. Scour estate agents’ websites daily and subscribe to their newsletters in order to receive instant alerts when something new comes onto the market.

Read the fine print

Keep an eye out for legal notices and note which homes are being repossessed. Go and view the home before the sale.

Handyman’s dream

Many ‘bargain’ properties are marketed as needing a little TLC and indeed there are properties which have been bought for a song because work needed to be carried out before the owner could move in. The big question here has to be how much work it’s going to take to get the home habitable, and at what cost. Do the maths before you buy.

Price is king

A listing that’s been on the market for a lengthy period without a drop in price is unlikely to be a good buy for those seeking a bargain. This is because these sellers are usually unwilling to negotiate – those who are desperate to sell will lower the price if there are no takers which generally makes them more willing to negotiate in order to get the property sold says www.privateproperty.co.za

Don’t delay

Once you’ve done your homework and recognise a good deal when it presents itself, act on it as soon as possible. Remember there are others who, like you, want to bag a good deal and those who dither could end up losing out on the bargain of a lifetime.

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8 things to check before renting an apartment

Finding a new apartment to rent can be an exciting and promising time for any tenant, whether you’re new to the rental game or an experienced player. But jumping head first into a new lease without first carrying out an in-depth walkthrough could leave you with a fair amount of unnecessary woe to deal with.

Tenants should always insist on viewing a property before signing on the dotted line. Besides being able to spot potential issues, you will avoid the risk of falling for rental scams. Not only is signing a lease without viewing the apartment ill-advised, tenants often run the risk of falling for rental scams when doing so.

Below is a list of things to pay close attention to while viewing a potential apartment:

  1. Doors and windows

Be sure to check that all the doors and windows open and close easily, especially sliding doors! Also make sure that the doorknobs aren’t wobbly and that the locks work. If any locks are broken or missing, be sure to bring this to the landlord’s attention so that you feel safe should you choose to move in. It’s also worth taking note of any draughts or sealing issues as this could make a difference to your electricity bill when it comes to heating or cooling the apartment.

  1. Walls and floors

While a small crack in the wall isn’t anything to be too concerned about, any crack that you can slide a 50c coin into could be a sign of bad structural integrity. In fact, spotting any structural flaws should serve as a warning to rather set your sights elsewhere.

Also, be on the lookout for any water damage or watermarks near the floorboards, on ceilings, and on the walls. Water damage indicates that something is leaking somewhere, which means that mould, mildew, or rot could set in if it hasn’t already. This could pose a serious health risk especially for those prone to allergies or respiratory infections.

  1. Appliances

Although most apartments in Eswatini come unfurnished, it is worthwhile checking that all supplied appliances are in good working order.

Check that the stove plates and/or gas hobs work and that the oven heats up and is free of grease or cooking build-up. Also, be sure to check that the fridge is cold, if one is provided, and if there’s a washing machine and tumble dryer, look inside to make sure that these too have been well maintained.

  1. Consider your furniture

A common mistake tenants make is signing the lease on an apartment before checking if their furniture will fit in come moving day. One sure way to avoid this is to measure all big-ticket items like beds and couches before viewing the apartment so that you have an idea of whether it can fit as well as how things can potentially be configured should you choose to move in. It may even be worthwhile taking along a tape measure to measure the floor space for even greater accuracy.

  1. Cellphone signal

It might sound unlikely in this day and age, but some areas still don’t have the best cellphone reception. With this in mind, take a moment to check your phone’s signal and connectivity during your walkthrough. If the lease includes WiFi, ask the landlord to demonstrate that it works and that it is currently connected with a strong signal.

  1. Crime

Living in a country where crime is an everyday concern means that it’s important to get to know the area you could end up living in. Check the security features of the apartment i.e. is the property access controlled by a guard or does it have an alarm system. It’s also worthwhile finding out where the local police station is and asking them, or even existing tenants, what crime is like in the area. If they are unable to assist, a simple Google search might help give you a good idea of any crime statistics and reports.

  1. Parking

If you own a car, parking arrangements should definitely be on your list of things to check out. In many neighbourhoods – especially in the city – street parking can be hard to find or unsafe for both you and your vehicle. Finding an apartment with a garage and/or an inside parking bay is therefore a necessity. Remember to ask whether the apartment comes with allocated parking and whether there is an additional cost for this.

  1. Noise levels

Before leaving, take a moment to listen to the neighbourhood and surrounding noise levels. Note how loud the traffic is, whether there are barking dogs or how easy it is to hear your neighbours. If you really like the apartment, try visit more than once and spend some time in the surrounding neighbourhood during the day and night. You may find that it’s much noisier at night, for example, so this will give you a better idea of what you’re in for.

While these are just some factors to be aware of when flat-hunting, there are many others – like checking for signs of pests, making a note of how easy the apartment was to find, looking at the upkeep of communal areas etc. Considering these factors when viewing potential apartments can help you find the right apartment and ensure that you aren’t caught off-guard later.

Once the lease is signed, you’re in it for the long haul so make sure that the apartment you choose doesn’t have any major issues that will make lead to renter’s regret.

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