Buying your first home is exciting until the figures start arriving from people you did not realise you would need to pay. The purchase price is only the beginning. In South Africa, the costs of buying a home can include transfer fees, transfer duty, bond registration, bank charges, insurance and expenses that begin before you have unpacked a single box.
A monthly bond repayment that fits your salary does not necessarily mean the purchase is affordable. You also need enough money to complete the transaction, move in and manage the ordinary expenses of ownership.
The best time to identify those costs is before signing an offer to purchase. Once the agreement is binding, discovering that you cannot afford the additional expenses can become a contractual problem as well as a financial one.
1. The deposit does not cover the whole transaction
A deposit is your contribution towards the purchase price. It should not be confused with the separate money needed for legal fees, taxes and moving expenses.
For example, if you have saved R100 000 and intend to use all of it as a deposit, you still need to establish how the remaining costs will be paid. Having savings is helpful, but allocating the same savings to several different expenses creates an immediate shortfall.
Some home loan products may provide finance beyond the purchase price to help with qualifying costs. That depends on the lender’s product, assessment and approval. It should never be assumed from a general advertisement.
Ask what the bank has actually approved
A loan covering the full purchase price does not automatically cover every expense associated with buying the property.
Ask the bank to confirm:
- The approved loan amount.
- Any deposit or shortfall you must provide.
- Which additional costs, if any, can be financed.
- Which amounts must be paid from your own funds.
- When those payments become due.
If fees are added to the loan, they still have to be repaid and may attract interest. Financing them changes the timing of the expense rather than making it disappear.
2. Transfer fees and transfer duty are different costs
These terms sound similar, which is why buyers often believe they describe one payment.
Transfer fees are the legal charges for registering the property in your name. Transfer duty is a tax administered by SARS. Bond registration fees are another separate expense where a mortgage bond is registered.
The transferring conveyancer’s account may also include Deeds Office charges and other expenses incurred during the transaction.
Ask for an itemised quotation showing professional fees, VAT where applicable, disbursements and tax. A single figure described as “transfer costs” may be useful for planning, but you should understand what it includes.
A property below the tax threshold still has transfer costs
Under the SARS transfer duty table applicable from 1 April 2026, the rate is zero for property values up to R1 210 000. Higher values attract duty according to a sliding scale.
For an ordinary transaction with a taxable property value of R1 500 000, the duty is R8 700. This is calculated at 3% of the amount above R1 210 000.
That figure covers the tax alone. It does not include the conveyancer’s fees or bond registration expenses.
Being a first time buyer does not itself create a general exemption from transfer duty. The applicable value and any statutory exemption determine the tax treatment.
3. VAT can change the tax position
Some property transactions, including qualifying sales by developers, are subject to VAT and exempt from transfer duty. The important question is whether the particular transaction is subject to VAT. The seller’s VAT registration alone does not answer every question.
Ask whether the advertised price includes VAT and have the conveyancer confirm the treatment before you commit.
A development advertised as having “no transfer duty” may still involve legal fees, bond registration expenses or other charges. If the developer offers to pay certain costs, obtain a written breakdown of the costs covered and any exclusions.
This prevents an attractive sales phrase from becoming an assumption that the entire transaction is free of additional expenses.
4. Registering the bond brings a separate account
Where a bank finances the purchase, attorneys register the mortgage bond over the property. This creates a separate legal account from the account for transferring ownership.
First time buyers sometimes receive the transfer quotation, budget for it and then discover that the bond attorneys also require payment.
Ask for both quotations early. Check whether any fee discount has been confirmed and exactly which charges it covers.
The bank may also charge an initiation fee and an ongoing service or administration fee. FNB’s buying guidance identifies bank charges and legal expenses among the costs buyers need to consider.
Compare the complete loan offer
The interest rate deserves attention, but it should be considered alongside the repayment term, fees, insurance requirements and conditions attached to any discount.
A lower monthly instalment achieved through a longer repayment term may mean paying more interest overall.
Ask for the written quotation and credit agreement. Make sure you can identify which payments are required before registration and which will appear on the loan account afterwards.
5. Taking occupation early can mean paying occupational rent
Moving in before registration may be convenient, particularly when your existing lease is ending. However, early occupation can create a separate payment obligation.
Occupational rent is usually dealt with in the offer to purchase. Absa’s guidance recommends agreeing the amount in writing before occupation where it has not already been settled.
Check the amount, when it becomes payable and how it will be calculated if registration occurs during a month.
You should also clarify responsibility for utilities and other expenses during occupation.
Budget for dates that do not line up
Your current lease, moving date and registration date may not fit neatly together.
You could face a period of overlapping accommodation expenses, storage charges or temporary accommodation. A delayed transfer may also require changes to removal bookings.
Avoid committing to arrangements that depend on registration happening on one exact date without understanding the cancellation or postponement costs.
6. Insurance needs to be ready at the right time
Buildings insurance is commonly required for a bonded home. Life cover may also be required under the lender’s conditions or considered as part of your own financial planning. Absa distinguishes these insurance needs in its home buying guidance.
Buildings insurance and household contents insurance cover different risks. Insuring the structure does not automatically insure your furniture, electronics and other possessions.
Obtain quotations before finalising your budget. Ask when cover must begin, what excesses apply and whether an existing policy can satisfy the lender’s requirements.
For a sectional title property, ask for the body corporate’s insurance information and establish what additional cover you need personally. Do not assume the scheme’s policy covers everything inside your unit.
7. Rates, services and levies become monthly commitments
Once you own the property, the bond is only one part of the monthly account.
Depending on the property and municipality, your budget may need to accommodate:
- Municipal property rates.
- Electricity and water.
- Sewerage and refuse charges.
- Sectional title or homeowners association levies.
- Insurance.
- Security, gardening or other services.
Municipal account deposits may also be required. Ask the municipality about its current account opening requirements and charges rather than relying on the seller’s experience from years ago.
Request recent accounts to understand the property’s existing costs, then consider how your household’s usage may differ.
Clearance amounts and adjustments need explanation
Transfer arrangements can involve municipal or levy clearance payments and adjustments between the parties.
Ask the conveyancer to explain who must fund each amount, what period it covers and whether any prepaid expense will be apportioned between buyer and seller.
The sale agreement matters. Do not assume that every amount appearing on an account belongs to you simply because you are buying the property.
8. A sectional title levy tells only part of the story
A manageable monthly levy does not necessarily mean a scheme has adequate money for future repairs.
Bodies corporate have responsibilities concerning reserve funding for maintenance and repair of common property. CSOS materials also identify the reserve budget and maintenance planning as important matters for scheme governance.
Before buying, request the current levy schedule, approved budgets, recent financial statements and meeting records.
Ask about approved special levies and major work being considered. A roof replacement, lift repair or substantial maintenance project can materially affect your ownership budget.
Establish how any existing special levy will be dealt with in the sale. Its payment schedule and the agreement between buyer and seller deserve attention before signature.
9. An inspection can prevent a much larger expense
The bank’s valuation assesses the property as security for lending. It should not be treated as confirmation that every part of the home is in good condition. Standard Bank explains the valuation’s lending purpose and separately recommends considering a professional inspection.
An inspection can help you identify concerns requiring further investigation, such as damp, roof damage, drainage problems or deteriorating plumbing.
Ask what the inspection includes and excludes. Some issues may require a specialist rather than a general inspection.
Disclosure forms do not replace investigation
Where applicable, obtain and read the seller’s mandatory property disclosure form. The Property Practitioners Regulatory Authority publishes the prescribed disclosure material.
Follow up on disclosed defects and unanswered questions. If alterations, extensions or converted spaces concern you, ask for the relevant plans and approvals.
Arrange inspections before committing, or obtain advice on an appropriate inspection condition in the offer. Discovering a problem after signing does not necessarily give you an unrestricted right to cancel.
10. Moving and immediate repairs need their own budget
Removal costs are easy to underestimate. Obtain quotations that account for the volume of belongings, travel distance, stairs, access restrictions and any storage required.
Then consider what the house needs immediately.
Locks may need changing. An alarm may need servicing. Curtains, blinds, cleaning materials and basic tools can create a sizeable combined expense even when each purchase seems modest.
Separate essential work from improvements that can wait. A leaking pipe deserves priority over replacing tiles because you dislike the colour.
Keep some money available after moving day. Using every remaining rand on furniture can leave you unable to deal with the first urgent repair.
The honest affordability test
Before signing, prepare three figures: the cash required to complete the purchase, the cost of moving and settling in, and the full monthly cost of ownership.
Ask for written quotations and make room for uncertainty. Test whether the budget still works if a variable bond repayment increases or an unexpected repair arrives.
The right question is broader than whether the bank will lend you the money. It is whether you can complete the purchase, live in the property and maintain it without turning an exciting milestone into a financial emergency.
