WHAT IS AN INSTALMENT SALE IN SOUTH AFRICA:
An instalment sale in South Africa is a method of purchasing property where the buyer pays the purchase price in multiple instalments over a period of time, rather than paying the full amount upfront.
Here are some key aspects:
- Payment Structure: The purchase price is paid in two or more instalments over a period exceeding one year.
- Legal Framework: These agreements are governed by the Alienation of Land Act 68 of 1981, which ensures that the contract is legally binding and protects both parties.
- Ownership and Occupation: The seller retains ownership of the property until the full purchase price is paid, but the buyer can take occupation and is responsible for rates and taxes from the date of occupation.
- Flexibility: This method is often used when buyers cannot secure sufficient financial institution financing but have the means to pay the purchase price over a period of time.
INFO added by: Meryl Muller
Real Estate Partners: October 2024