What you need to know about buying property with someone


Cohabiting before marriage and even choosing not to go the legal marriage route is commonplace these days, and many cohabiting partners seek to purchase property together, often as first-time buyers.

Buying a property with your married spouse is quite simple as there is a legal relationship with consequences attached to it.

In the case of cohabitation, however, there is no legal relationship and South African law does not confer any legal status.

It therefore follows that there is a clear difference between buying and selling real estate with one’s legal spouse compared to a cohabiting partner.

The latter can be particularly difficult, and planning beforehand is essential to avoid conflicts later on.

Buying and selling real estate jointly with a legal spouse

When buying a property with your legal spouse, you usually take out a joint mortgage loan, the property is then owned equally and both parties are jointly and severally liable for the mortgage loan.

The written approval of the other spouse is required if either spouse wishes to mortgage or sell the property.

In the event of a divorce, the divorce agreement will specify how the property is to be treated.

If it has to be sold, the spouses will share the proceeds equally. If either spouse retains ownership, no formal transfer of ownership takes place, but title will need to be endorsed by way of application to the Registrar of Deeds.

In the case of a marriage outside community of property, each party has its own assets and therefore is co-owner of the property and also shares the proceeds of the sale.

If a party chooses to retain ownership in the event of a divorce, the transfer of the share must be effected by means of a formal deed of transfer and not simply an application to the Registrar of Deeds.

Buying and selling real estate in common with a partner

When you buy property with someone other than your legal spouse, whether in a cohabiting relationship or otherwise, the property as a whole is jointly owned and no particular part would be owned solely by one of the joint owners. , explains Tiaan Pretorius, director for Seeff Centurion.

While the consent of the other owners is required to sell, mortgage or lease the property, a co-owner can sell or rent his own undivided share in the property without the consent of the other co-owners.

Pretorius therefore recommends that you consult a lawyer and draft an agreement from the outset to guide the ownership and disposal of property.

Do it as soon as possible and before the property is even registered, he says.

What happens in the case of a leased property?

According to Rochelle Holland, the responsibility for paying rent is dictated by the lease agreement.

The person(s) whose name is listed in the lease will be responsible for paying the rent.

In the event of a legal marriage, both parties will be responsible regardless of who signed the lease, except in the event of a marriage outside community of property where the party who signed the lease will be responsible.

She adds that in the case of cohabitants, the parties will be jointly and severally liable, each for their part, but from a legal point of view, they will be jointly and severally liable for the full amount of the rent.

If the relationship ends before the lease expires, the lease will remain in effect.

They will therefore need to agree who stays and take care of the payments, but it is recommended that the party remaining in the property enters into a new rental agreement instead.

Gerhard van der Linde, managing director of Seeff Pretoria East.

This article has been republished with permission from Moneyweb. Read the original article here.


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