Blog | 10th August 2020

Hidden Costs 

Nerves are an understandable part of the process when buying a home. Not only is it a big commitment, but we’re also generally weary that there’s so much more to the deal: fine print, hidden costs, unlisted extras… Knowledge is power, so knowing how to approach your decision to buy property ultimately comes down to one thing: information.

Our second PodAcademy Podcast is packed full of information as Reeflords’ Sales and Marketing head, Dora Liu talks with host David Watts about many of the misconceptions, misunderstandings and so-called hidden costs involved when buying a home.

Click here to listen to their chat, but just in case you would like to keep track of the tips discussed, we’ve summarised their conversation under the key topics with the things you should be sure about when buying a home.


Levies are issued to property owners to cover the expenses associated with the running of the estate. These may include garden services, refuse removal (internally), electricity for the common property areas (such as the guard posts or clubhouse), and may also include specified line items such as effluent and sanitation, water and electricity or gas (where those are not prepaid).

Special Levies

From time to time, special levies may be incurred by property owners for costs related to renovations, paving upgrades or approved modifications that are required for the upkeep of the estate on the whole. These costs are divided across the total number of units in the development and are billed separately to your normal, monthly levies.


  • Both levies and special levies are the responsibility of the property owner (not rental tenants), and will be required whether you are buying an existing unit in an existing complex, or a new unit in a new complex.
  • It is a good idea to ask the seller for the latest bills in order to calculate an average of what you can expect to pay monthly. In the case of buying a new property in a new development, you can ask for an estimation of the line items’ bill in order to help you budget accordingly.
  • If you have bought into a development with prepaid electricity meters in each unit, be aware that there will still be additional electricity costs issued as levies by the body corporate. This s for electricity that is required in common areas (outside of your own unit) and range from things like the streetlights to the running of the guard house and more.

Rates and Taxes

Rates and taxes are the responsibility of the property owner (not rental tenants) and cover items such as electricity (based on the meterage within the complex), refuse removal (external council services), water and sanitation (sewerage).


  • All owners are liable for rates and taxes

Transfer Duties

Transfer duties apply to buying an existing home or a unit in a complex from a seller or developer. This is an upfront, once-off payment that covers the cost imposed by SARS and is based on the purchase price for properties over R1million only.


  • If you are purchasing directly from a developer, you pay VAT and therefore do not pay transfer duties. As a homeowner, you will pay either VAT or transfer duties, but not both.

Transfer Costs

Transfer costs are different to transfer duties in that these cover the administrative costs of transferring the title deed into the purchaser’s name. These costs are derived by the deeds office-fees and the attorney’s fees associated with the administration of all relevant paperwork.


  • If you are buying a previously-owned property, the buyer is liable for the transfer costs.
  • If you are buying from a developer, the transfer costs are (usually) covered by the developer.
  • Where Reeflords is concerned, these costs are covered by Reeflords Property Development, but this may not be the case with other developers. To be safe, the buyer should enquire about where the liability of these costs rest.

Bond Costs

Many purchasers don’t know that bond costs are a separate upfront fee that the buyer is liable for. Bond costs relate to the costs incurred for the registration of the bond of the property (that you are ultimately buying via a loan through your chosen financial institution), and also include attorneys and disbursement fees. To give you an idea, if you are looking at a property valued at R1million, then you can estimate your bond costs to be in the region of R12,000.00. This will vary between different attorneys and/or law firms, but should help you gage how this cost may impact your budget preparations.


  • If you are buying a previously-owned home, the buyer bears the Bond costs (it is not the seller’s liability).
  • If you are buying from a developer, while not all cover this cost, many do, so be sure to find out what applies with regards to the developer you are buying from, so that you aren’t surprised later in the process with costs you hadn’t budgeted for.
  • Reeflords cover bond costs at certain developments, while others are discounted.

We know that initiating the process to a commitment that spans decades can’t be made without resolute trust, which is why we at Reeflords pride ourselves on making the transaction of buying a home as transparent as possible.

For more insights that cover initiation fees, connection fees, life cover and household insurance , be sure to listen to the full PodAcademy Podcast and make sure your best approach is an informed one.

That’s what responsible property development and management is all about. That’s how we help you to start living your way.


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