Mail & Guardian
Mail & Guardian

Buying bank-repossessed property

1 min read

Is that bank-repossessed property really a bargain?

Yes, you don’t have to pay transfer fees when you buy a Property In Possession (PIP), but make sure that the purchase doesn’t cost you more than you think it will. Banks like to get rid of repossessed properties quickly, so be sure to do your homework before snapping up a “bargain”.

  • You may get the property cheaply, but will you have to make extensive repairs to a neglected or vandalised property? If so, what are they likely to cost? You buy the property “voetstoots” (as is), so you need to be satisfied that you won’t have to do extensive repair work later on.

  • Is the property vacant? If it is tenanted, you may face great difficulties having the occupants evicted. You don’t want to pay a bond on a property you can’t take possession of.

  • Establish the resale value of the property — is it in a good area with a low crime rate, close to amenities and so on? Even if you have no children, buying near a good school may be a great advantage if or when you want to sell later.

    • Read more news, blogs, tips and Q&As in our href=”http://www.mg.co.za/section/smart-money” rel=”external”>Smart
    Money section. Post questions on the site for independent and
    researched information