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Friday Feb 26, 2016

Joburg moves to protect unsuspecting property buyers

The City of Joburg says it has saved homebuyers a staggering R730 million in historical debt.

City revenue department spokesman Kgamanyane Maphologela said the debt had been recovered from about 25 033 properties, by ensuring it was settled with the seller.

"In an effort to ensure that the new homeowner (buyer) does not inherit the historic debt for rates and services from the previous owner (seller), the city is writing to transferring and conveyancing attorneys advising them of the legislative requirement," he said.

Maphologela said a specialised firm of attorneys had been appointed to ensure outstanding monies on properties were collected before the property was transferred.

In terms of section 96 of the Local Government: Municipal Systems Act, No 32 of 2000, municipalities are obliged to collect monies payable to them in respect of property rates, taxes and municipal services.

First, a clearance figure is provided. These figures include outstanding money on the account for the two years preceding the date of application as well as four months' projected consumption. Once this amount is paid, the city can issue a clearance certificate. "It is very important for transferring and conveyancing attorneys to advise clients about historic debt," said Maphologela.

Further, the buyer has the right to approach the city to obtain the municipal statement of the seller and property on condition that they can produce a valid offer-to-purchase document signed by the seller, buyer and estate agent.

The buyer also has the right to request a copy of the seller's municipal account from the estate agent.

Maphologela said although a decision by the Supreme Court of Appeal in a case involving the City of Tshwane and a property owner found the buyer could be held liable for old debt, the City of Joburg would apply its mandate to collect debt when a sale had taken place but prior to the transfer.

Metro Watch
The Star

 
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