Why your property needs a plan long before you sell

By Simon Andrew | rare erf seller advisory

About the author: Simon Andrew is the founder of Rare Erf, a seller advisory service for property owners in Hermanus and the Overstrand. A property consultant for Fine & Country, the international real estate agency network specialising in upper-bracket properties, Simon brings over three decades of international marketing experience and a background in psychology and negotiation to his work. He helps sellers prepare, position and market their properties, make informed decisions and achieve the best possible outcome.

Note: This article provides general information. Obtain advice suited to your circumstances from an attorney, tax practitioner or appropriately qualified financial adviser before acting on estate or tax matters.

Planning ahead puts you at an advantage

You may have no intention of selling your home. You like living there. The garden is finally doing what you hoped it would. Moving sounds like a great deal of effort for a result you are not sure you want.

That is a perfectly good reason to stay. It is also a good time to think about the property’s future, while you have the freedom to consider it without a deadline.

For owners in Hermanus, Vermont, Onrus, Sandbaai and Arabella, that conversation might involve downsizing, a future move closer to family, or deciding what should happen to a much-loved holiday home. It may also involve a question we tend to postpone: what happens to this property when I am no longer here?

Planning early gives you and your family more time to prepare, understand the choices and avoid preventable pressure. You can begin years before putting a property on the market.

Your plan should be made before listing

If you want to sell now, there is a clear job to do: assess the market, prepare the property, agree a marketing strategy and negotiate a suitable sale. Those decisions deserve care.

But a homeowner who may sell in three years needs a different conversation. Which repairs should happen now? Would a proposed renovation appeal to likely buyers, and could its cost be recovered? What would need to change for staying to become impractical?

Someone who hopes to leave the property to their children needs to explore different questions again. Do the children want it? Can they afford to keep it? Would one use it while the others would prefer their share in cash?

A useful property relationship has room for all of these situations. Asking for advice should leave you better informed, with time to decide what happens next.

The home you love may mean something different to your heirs

Imagine a family holiday home in Onrus. To its owner, it holds decades of December holidays and the hope of many more. One adult child lives overseas. Another would love to use it but cannot comfortably contribute to the upkeep. A third needs money for a home of their own.

This is an illustrative example, but the disagreement is easy to understand. Each person can love the family and have a different view of what should happen to the house.

Before assuming that keeping a property in the family is the best outcome, discuss who would use it, who would manage it and who would pay. If ownership is to be shared, ask an attorney how decisions, contributions and a future exit could be arranged.

Making these differences discussable while you are alive gives everyone a chance to understand your wishes and explain their circumstances. It can also spare your heirs the feeling that selling would somehow betray you.

A will needs practical planning alongside it

A valid, up-to-date will is the legal starting point. The Department of Justice explains that a will sets out what should happen to your estate and allows you to nominate an executor. Estate administration involves collecting assets, paying debts and distributing what remains to the beneficiaries.

A family conversation helps clarify intentions, but those intentions need to be reflected properly in the legal arrangements. Your attorney or estate-planning specialist should check that your will, ownership structure and any rights of occupation work together.

There is also the practical business of looking after a house. Who knows where the insurance policy is? Who will attend to a leak, arrange security or contact the managing agent? Where are the lease and tenant records if the property is rented?

These details belong in an accessible property file. Knowing your wishes is far more useful when the people carrying them out can also find the paperwork.

A valuable property still needs cash behind it

A house can account for much of a family’s wealth while leaving relatively little cash available for bills. Rates, insurance and maintenance continue while an estate is being administered, and there may be debts and administration costs to settle.

Estate duty may also apply, depending on the estate and the available deductions and abatement. SARS explains that the executor administers the estate and distributes the remaining assets after debts have been paid.

Death can also trigger capital gains tax consequences through a deemed disposal of assets, even without an actual sale. According to SARS, exceptions and relief may apply, including qualifying transfers to a resident surviving spouse. The calculation needs individual advice from a legal expert.

The practical question for your advisers is whether sufficient accessible funding will be available to meet the obligations while the intended property arrangements are carried out. An estate with substantial property wealth can still face pressure to sell if it lacks cash.

Reviewing this early can help identify a funding gap while there is time to address it. The appropriate solution will depend on your wider finances, family circumstances and legal arrangements.

Understand your market before testing it

“Let’s put it on the market and see what happens” can sound like an easy way to explore your options. Before doing that, it helps to know what you would do if a suitable offer arrived.

An advertised price tells buyers something about your expectations. If the property is poorly prepared, inconsistently presented or repeatedly repriced, buyers may question the asking price or your readiness to sell. A public listing is part of the marketing history of the home.

That does not mean the first figure mentioned fixes its value forever. Prices can change as the market, the property or the evidence changes. A private market appraisal can be updated and does not require you to launch a sale.

My marketing background makes me interested in the work that happens before a listing: understanding the likely buyer, identifying what makes the property appealing, and deciding which improvements are worth the expense. That preparation helps you make a more deliberate decision about when and how to go to market.

Good timing depends on your circumstances

Early planning does not automatically mean delaying a sale. Holding a property brings costs and exposure to market changes. Sometimes a prompt sale is exactly what an owner needs.

The useful comparison is between realistic outcomes: what you might receive after costs, how long each option could take, and what it would mean for your life. A higher eventual selling price may offer little benefit if the extra costs and inconvenience absorb the difference.

Discuss these priorities openly with your agent, along with fees, the marketing plan and the basis for any recommendation to accept an offer. A good recommendation should make sense in the context of your circumstances.

Give your family a property file they can use

A practical first step is to bring the information together. Depending on your property, that could include:

• Ownership and bond details, a copy of the title deed, and the relevant professional contacts.

• Approved building plans, records of alterations, known defects, warranties and available compliance certificates.

• Rates, levies, insurance and maintenance costs, with a realistic annual budget.

• Leases, managing-agent details and arrangements for routine care or an unexpected absence.

• A dated market appraisal, its supporting evidence and records of major improvements.

• The location of your original will, your executor’s contact details and a record of the property options you have discussed.

Store sensitive documents securely and let the appropriate people know how to access them. Review the file after a major change in your family, finances or property. Any informal statement of wishes should be checked against the legal documents; the file itself does not give someone authority to act.

Start the conversation while you have choices

My role is to help you understand the property and its market, think through preparation and timing, and identify questions to take to the relevant legal, tax and financial professionals.

That relationship can begin well before a sale is on the horizon. It gives me time to understand what matters to you, and gives you a familiar property contact if your circumstances change or your family later needs guidance.

If you are unsure where to begin, start with one question: if this property needed to be sold or managed by someone else next year, what would they need to know?

Get in touch if you’d like to discuss putting a plan in place.