What is a tittle deed and why it is so important?

The property market was brought to a standstill with the Deeds Office closure last year, but many might fail to understand why.
For clarity, one first needs to understand that the title deed is a document that proves legal ownership of a property in South Africa – and the Deeds Office is where copies of these documents are held.
When these offices close, Adrian Goslett, regional director and CEO of RE/MAX of Southern Africa, explained no properties can be bought or sold as the title deeds cannot be transferred into the new owner’s name.
“According to the Deeds Registries Act, 47 of 1937, anyone who purchases a home will need to have the title deed transferred into their name as proof that they own the property.
“This is why several Deeds Offices are found throughout the country, each tasked with handling a particular area of jurisdiction.

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“The office within the closest proximity to where the property is located will keep a copy of the home’s Title Deed in the form of the Deeds Registry.
“This registry is open to anyone who requires access to this information for a nominal cost,” he clarified.
In most cases, the original copy of the Title Deed will be held by the financial institution through whom the buyer has acquired his/her home finance.
“The owner of the property will only receive the original Title Deed once the home loan is paid back in full.”
Banks are legally entitled to keep the Title Deed because it is their money that bought the home and they have a vested interest in the property,” Goslett explained.
In addition to declaring legal ownership, the document also contains important information about the property, including a comprehensive description and exact size of the property as well as the rules and restrictions surrounding the property.
The document also shares some insight into a property’s history, including the name of the registered owner and previous owners and the purchase price paid by the current owner.

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“By reading the Title Deed on a property, a prospective buyer will know if there are any conditions applicable to the zoning, use or sale of the land, along with all real rights registered in respect of the property.
“This is why buyers should read through the Title Deed carefully to ensure that they are fully aware of all the details pertaining to the property before signing the OTP,” added Goslett.
Even if the bank that holds the bond over the property has the original Title Deed in their possession, Goslett noted that the homeowner or agent marketing the home should have a copy that the buyer can read through.
Alternatively, buyers can access the information directly by obtaining a copy from the Deeds Office.
Considering how important the Title Deed and consequently the Deeds Office is, it is incredible how quickly the real estate industry has been able to bounce back after the hard lockdown.
“After months of not being able to generate any income, our agents hit the ground running when the Deeds Offices finally re-opened, recording record-high sales volumes month after month in the latter half of 2020.
“While we do not know what lies ahead in the year to come, we remain hopeful that we shall not see another nation-wide Deeds Office closure and are incredibly grateful for the months of excellent sales we are continuing to see,” Goslett concluded.

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