First-Time Buyer's Guide to Property Transfer Costs
A first-time home buyer's guide to transfer costs in South Africa — what you'll pay, how to budget, the R1.21 million transfer duty threshold, and costs you might not expect.
Written by admitted attorneys — plain language, no legalese
What First-Time Buyers Need to Know
Transfer costs are the once-off expenses you must pay in cash before the property can be registered in your name at the Deeds Office. They are separate from the purchase price and generally cannot be financed as part of your home loan. This catches many first-time buyers off guard — you sign an offer to purchase at a certain price, and then discover there is a significant cash amount needed on top of that figure before the property is legally yours.
As a rough guide, budget 3–8% of the purchase price for transfer costs alone. The percentage is higher for cheaper properties because attorney fees make up a larger proportion relative to the price, and lower for more expensive properties where transfer duty dominates. On a R1 million property, transfer costs are roughly R19,000–R20,000. On a R2.5 million property, they climb to around R89,000. These are transfer costs only — if you are taking a home loan, bond registration costs are additional.
If this is your first home purchase, know that you are far from alone. First-time buyers represent nearly half the residential property market in South Africa. The process can feel overwhelming, but the costs are predictable and well-documented. This guide walks you through every component so you can budget with confidence.
The R1.21 Million Transfer Duty Threshold
Properties purchased for R1.21 million or less are completely exempt from transfer duty — the largest single component of transfer costs. This is not a special first-time buyer benefit; it applies to all buyers regardless of whether they have purchased property before. However, it particularly helps first-time buyers because they are typically purchasing in this lower price range. If your purchase price is at or below this threshold, the only transfer costs you will pay are the conveyancing attorney's fees, Deeds Office levies, and disbursements.
Above R1.21 million, transfer duty is calculated on a sliding scale. You pay 3% on the portion between R1.21 million and R1.664 million, 6% on the portion between R1.664 million and R2.329 million, and progressively higher rates beyond that. The key point is that transfer duty is marginal — each rate applies only to the portion of the value within that bracket, not to the full purchase price. This threshold was adjusted upward from R1.1 million effective 1 April 2025.
Not a first-time buyer benefit
A common misconception is that the R1.21 million transfer duty exemption is specifically for first-time buyers. It is not — it applies equally to all buyers. There is no additional or separate transfer duty discount for first-time buyers in South Africa. The only government programme specifically targeting first-time buyers is the FLISP subsidy (discussed below), which is income-based, not transfer duty-based.
Three Price Points Compared
To give you a concrete sense of what you will pay, here are estimated transfer costs at three price points commonly relevant to first-time buyers. These figures include transfer duty, attorney fees (with VAT), Deeds Office levies, and disbursements. They do not include bond registration costs.
Approximately ~2% of purchase price
Approximately ~2.2% of purchase price
Approximately ~3.6% of purchase price
These are estimates based on Law Society tariff guidelines and current Deeds Office levies. Your actual figures may vary slightly depending on the specific conveyancer. Use our transfer cost calculator to get an estimate for your exact purchase price.
Transfer Costs Breakdown
Transfer costs consist of four components. Transfer duty is a government tax paid to SARS — it is calculated on a sliding scale and is exempt for properties at or below R1.21 million. Conveyancing attorney fees cover the legal work involved in preparing and lodging the transfer documents at the Deeds Office, and are subject to VAT at 15%. Deeds Office levies are a government registration charge, fixed in steps based on the purchase price. Finally, disbursements cover the smaller costs your attorney incurs on your behalf: FICA verification, electronic lodgement fees, postage, and petties.
For properties below the transfer duty threshold, attorney fees become the dominant cost component. For properties well above the threshold, transfer duty is by far the largest line item. Understanding this breakdown helps you assess whether the estimate your conveyancer provides is reasonable.
What Makes Up Transfer Costs
Transfer Duty
A government tax paid to SARS on the acquisition of property. Properties at or below R1.21 million are exempt. Above that, the rate increases on a sliding scale up to 13%.
Conveyancing Attorney Fees
Professional fees charged by the transfer attorney for managing the transfer process — FICA verification, document preparation, and Deeds Office lodgement. Subject to VAT at 15%.
Deeds Office Levies
A government registration charge for recording the transfer at the Deeds Office. A fixed amount based on the purchase price — relatively small but unavoidable.
Disbursements
Smaller costs that add up: FICA verification fees, postage, electronic lodgement fees, and general petties. Typically R1,000–R2,000 combined.
Bond Registration Costs
If you are taking a home loan to finance your purchase — as most first-time buyers do — there is a second set of costs that are entirely separate from transfer costs. When the bank grants your bond, it must register a mortgage bond over the property at the Deeds Office as security for the loan. The bank appoints its own attorney (the bond attorney) to handle this registration, and you, the borrower, pay their fees.
Bond registration costs include the bond attorney's fees (calculated on a Law Society tariff based on the bond amount, plus VAT at 15%), a Deeds Office levy for bond registration, and disbursements. On top of these, the bank typically charges a once-off initiation fee of around R6,000–R7,000 for processing the home loan application. The initiation fee can sometimes be added to the loan amount, but the bond attorney's fees must be paid in cash.
A common and costly mistake among first-time buyers is budgeting only for transfer costs and being caught off guard when the bond attorney sends a separate account. Budget for both from the start. Use the bond cost calculator to estimate your bond registration costs.
This does not include moving costs, home insurance, or occupational rent. Budget separately for those.
Costs You Might Not Expect
Beyond the formal transfer and bond costs, first-time buyers often encounter expenses they did not anticipate. None of these are hidden — they are standard parts of any property transaction — but if you have never bought property before, they can come as an unwelcome surprise. Factor them into your overall budget from the outset.
Costs You Might Not Expect
Occupational rent
A monthly payment to the seller if you move in before registration is complete. Typically set at the bond repayment amount or market rental and agreed in the OTP.
Pro-rata rates adjustment
The seller may have paid municipal rates in advance. You reimburse the seller from the registration date to the end of the period already paid for.
HOA / body corporate fees
Joining fees for the homeowners' association, levy clearance fees, and the first month's levy — particularly relevant in estates and sectional title schemes.
Home insurance
Your bank will require building insurance from the date of registration. Budget for at least the first month's premium, which must typically be in place before the bond can be registered.
Moving, locks, and alarm
Moving costs, changing the locks, and setting up or transferring the alarm system. These are not legal costs, but first-time buyers often forget to budget for them.
Occupational rent deserves special attention for first-time buyers. If the OTP stipulates that you take occupation before registration (which is common, especially on new developments), you will pay the seller a monthly amount — typically equivalent to the bond repayment — from the date you move in until the date of registration. This period can be two to four months, so the total cost is significant and must be planned for.
How to Budget
As a practical rule of thumb, budget 8–10% of the purchase price for all costs combined — transfer costs, bond registration costs, moving expenses, insurance, and incidentals. On a R1.5 million property, that means having R120,000–R150,000 available in cash beyond the purchase price. On a R2 million property, budget R160,000–R200,000.
This applies even if the bank grants you a 100% bond (financing the full purchase price with no deposit required). A 100% bond covers only the purchase price — it does not cover transfer costs, bond registration costs, or any of the additional expenses listed above. The only scenario in which you might finance some of these costs is if the bank grants a bond exceeding 100% of the purchase price, which requires an exceptionally strong financial profile and is not guaranteed.
Start saving for costs as early as possible. If you are six months from purchasing, set aside a fixed amount each month specifically earmarked for transfer and bond costs. Having a clear budget prevents the stress and delay that arises when buyers cannot fund the attorney's account and the entire transaction stalls.
FLISP Subsidy
The Finance Linked Individual Subsidy Programme (FLISP) is a government grant specifically designed for qualifying first-time home buyers who earn between R3,501 and R22,000 per month. The subsidy amount — up to approximately R130,000 depending on your income bracket — is paid towards the purchase price of the property, which reduces the bond amount you need from the bank. This means lower monthly repayments and less interest paid over the life of the loan.
FLISP is not a loan — it is a once-off grant that does not need to be repaid, provided you meet the conditions (including that you must live in the property and not already own other residential property). You apply for FLISP through your bank or directly through the National Housing Finance Corporation. The application process runs alongside your home loan application, and the subsidy is paid directly to the conveyancer handling the transfer.
If your household income falls within the qualifying range, FLISP can make a meaningful difference to affordability. Speak to your bank about whether you qualify before signing the offer to purchase, so that the subsidy can be factored into the transaction from the start.
FLISP eligibility snapshot
Who qualifies: First-time home buyers (no current or previous property ownership), South African citizens or permanent residents, earning R3,501–R22,000 per month gross household income. You must be approved for a home loan by a registered bank. The property must be used as your primary residence.
Tip
Before you sign the offer to purchase, get a written cost estimate from the conveyancer and ask the bank about bond registration costs and initiation fees. Add them together — that is your total cash requirement. Knowing this figure upfront prevents the single most common source of stress for first-time buyers: running short of cash when the attorney's account arrives.
Lower Your Attorney Fees With a Fixed Fee
One of the most effective ways to reduce your upfront costs as a first-time buyer is to choose a conveyancer that charges a fixed fee instead of the sliding-scale LSSA guideline tariff. MJ Kotze Inc charges a R20,000 fixed conveyancing fee, inclusive of VAT, for standard residential transfers — regardless of the purchase price. On a R1.5 million property, the LSSA guideline fee plus VAT is approximately R25,000. On a R2 million property, it is over R40,000. The fixed fee saves you real cash at a time when every rand counts.
Written by
Pretoria Transfer Guide
MJ Kotze Inc
Common questions
Frequently asked questions
R20,000 fixed fee conveyancing — no surprises
Most attorneys charge R35,000+ for a R2 million transfer. We charge R20,000, inclusive of VAT, no matter the purchase price.