South Africa

Property transactions

Cape Town deeds office reopens for business

Cape Town deeds office reopens for business
The Cape Town Deeds Office backlog is causing chaos in the city's property market. (Photo: Flickr / Vicki)

The Cape Town deeds office will again accept lodgements from Friday onwards. This comes after conveyancers threatened to approach the high court for urgent relief on the matter.

Deeds offices, which are responsible for the registration, management and maintenance of the property registry of South Africa, were to be allowed to open from 13 May across the country, as they were listed as an essential government and administrative service allowed to commence operations under Level 4.

And while deeds offices in the rest of the country seem to be operating smoothly, the Western Cape hit a speed bump in attempting to open.

On 19 May, the Cape Town deeds office addressed an email to all conveyancers that lodgements were suspended “with immediate effect and until further notice”. This was because of a lack of staff at the office.

The office also sent an email to staff, asking them to return to work.

In the email, the office noted it would be applying a “no work, no pay” principle from Wednesday 20 May.

“Staff who have been instructed to return to work have not yet reported working in sufficient numbers,” law company The Big Small Firm said in a statement on 19 May.  

“There simply are not enough staff members at work to attend to the deeds that were lodged since last week’s opening and they will process these for uptake into their system first, before accepting further new lodgements.”

The Cape Town Attorneys Association (CTAA), which represents a large number of conveyancers who use the deeds offices on a daily basis, wrote to the Chief Registrar of Deeds, Carlize Knoesen, that all health protocols had been put in place.

“It is our understanding that all protocols pertaining to the provision of PPE, sanitising of the premises, health protocols and the plan facilitating the phased-in return of employees were in place before the opening of the Deeds Office on 13 May 2020,” said Clive Hendricks, chairperson of CTAA.

The CTAA added that the chief registrar should take further action to deploy a suitable workforce within 24 hours, “failing which we shall have no alternative but to approach the Cape Town High Court for urgent relief”.

Daily Maverick asked Knoesen for comment on the matter, but by the time of publishing had not received one.

“The members we represent were upset because it impacts on their conveyancing practices because they are unable to lodge deeds,” Hendricks said. “If lodgements are being suspended, then conveyancers can’t do their work.”

The role of a conveyancer is to aid with the settlement and title transfer process by ensuring that their client meets all legal obligations and that their clients’ rights are protected during this transaction.

Jawitz told Daily Maverick that due to the fact that real estate agents and agencies work on commission, the closing of deeds offices and the failure to do work would have had a significant knock-on effect. Agencies would not be able to generate cash flow from historic deals.

Francois Viruly, property economist and associate professor at the University of Cape Town, told Daily Maverick it is of  “critical importance” that deeds offices open and function properly.

“There are transactions that took place during the lockdown and before which need to get through,” Viruly said. “These are sums of money that are now locked.”

However, The Big Small Firm released another statement on Wednesday confirming that the offices will once again accept lodgments from Thursday 21 May, onwards.

The media liaison officer for the Department of Agriculture, Land Reform and Rural Development, Reggie Ngcobo, said everything had resumed as per normal.

“There were some glitches as there was a misunderstanding between management and the unions, but it has been resolved,” Ngcobo said. “Because the issue was around lodgements, but the office in Cape Town is operational.” 

Beyond the conveyancers, real estate agencies would also suffer if lodgements were to continue being suspended since agencies can only function at Level 2 of the lockdown, says the CEO of Jawitz Properties, Herschel Jawitz.

Jawitz told Daily Maverick that due to the fact that real estate agents and agencies work on commission, the closing of deeds offices and the failure to do work would have had a significant knock-on effect. Agencies would not be able to generate cash flow from historic deals.

“And that’s obviously put a massive strain on the industry to estate agencies and the agents,” Jawitz said. 

“And so, the opening of the deeds office, even if on a partial basis, was going to be a significant step forward in just releasing some short-term pressure in terms of commissions, because we only get paid when actual registration of transfer goes through.”

Kevin Jacobs, an estate agent at RE/MAX, said many agents have not earned any income since the end of March when the nationwide lockdown was imposed.

Jacobs said it was vital for the deeds offices to start working again and for lodgements to continue, as the consequences of the delay could be severe.

“If registrations aren’t happening, doors will be closed and the agents will be the ones to suffer,” Jacobs told Daily Maverick.

Viruly added that if the deeds office did not open, this would affect many people in South Africa who are looking to sell or buy homes. 

“We have a lot of households that need to readjust their family finances and even business finances. And for a number of people it is absolutely critical that they are able to sell the properties,” Viruly said. DM

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