The Hidden Costs of Buying a House in South Africa

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Written by Team Hot Property
Published in: Insights
November 9, 2022

Picture this: You’ve just decided to purchase your first home. You’ve checked your credit score, calculated your affordability and have run the numbers for calculating a bond and the monthly repayment cost. But before you dive in and start looking for your dream property, there are several other costs that you need to take into account—the hidden costs of home ownership, often referred to as hidden fees when buying a house.

If these extra costs when buying a house are not taken into account, your affordability calculations could be way off, and you may have to review your plans.

In this post, we’ll break down all of the ‘hidden’ costs of buying a home. We’ll cover all of the fees associated with buying a house, including the once-off additional costs related to securing the property and monthly on-going home-owning expenses.

How Much Does it Cost to Buy a House?

When looking for a property, you’ll generally take the selling price into account and use it to calculate a monthly bond repayment value. In most cases, you will have saved up for a deposit, which will reduce the bond amount required.

Beyond the monthly bond payment and the potential deposit, there are additional fees and costs involved. These additional costs are sometimes referred to as ‘hidden costs’ as they’re not directly related to the total price of the property and the monthly bond repayments.

Although not exactly hidden or secret, these costs are well known in the property industry and amongst seasoned property buyers, however new buyers who are not fully clued up on the processes related to buying a home, may find the amounts come as a shock, as they’re not widely discussed.

Purchasing a property is not only a dream of many but it is also a huge achievement and investment. It comes with great responsibility and the finances involved should not be taken lightly. We hope to equip you with as much knowledge and information as possible so that you can make well-informed decisions, budget accordingly and set yourself up for success from the beginning.

Once-Off Costs Involved When Buying a House

The highest cost when purchasing a property is the price of the property itself. Beyond this, the additional costs are:

Transfer Costs

In order to register the property in your name, there are several costs relating to the transfer of the property.

  • First, there is a cost for conveyancing. Here, the buyer pays a fee to the conveyancer, also known as the transferring attorney and the transfer fees, to register the property in the buyer’s name. These fees are calculated based on the purchase price of the property, on a sliding scale. eg transfer costs on a property with a purchase price of R1 000 000, amounts to R28 423. Although the transferring attorney is normally appointed by the seller, conveyancing fees can sometimes be negotiated and it is worthwhile discussing this item with the attorney.
  • Next, there is transfer duty, a tax levied by SARS on each sale of immovable property. This fee is usually one of the highest additional costs that buyers need to prepare for. If your property is below R1 million, there will not be a transfer duty; however, if the property is over R1 million, you’ll incur this cost. You can calculate the transfer duty either using an online transfer cost calculator or via the SARS Transfer Duty table.
  • Finally, the Deeds Office charges an administrative fee for processing documentation received from your conveyancer and for registering the transfer of ownership of the property and for registering the bond over the property. This process is handled by your conveyancer, who will bill you and transfer it to the Deeds Office. The Deeds Office Fee is calculated in relation to the value of the property and can be referenced here.

Bond costs

Next, there are several costs associated with the bond.

  • First, there is a bond initiation fee, also called a bond registration cost. This is an administrative fee for initiating the bond and opening a bond account in your name and is charged by the bank. This fee varies based on the funder or lender. Some banks may charge a set fee of roughly R6000; others may set the fee based on a percentage of the loan amount. A good idea is to find out this cost and pay it upfront to avoid accumulating interest on it. If this isn’t possible, this amount will included within the loan amount.
  • Next, there is a fee paid to the attorney responsible for registering your bond, also known as the bond registration fee or bond costs. This fee, based on guidelines set out by the Law Society of South Africa. The bond cost is calculated on a sliding scale, based on the amount of your bond. As an example,, budget roughly ZAR27 000 for the bond costs on a bond of R1 000 000.


Another cost to keep in mind is the deposit. If you have savings you are prepared to invest in the property, you could use these funds as a deposit. Most sales of properties are closed with a minimum of a 10% deposit.

Including a deposit has both pros and cons:

  • A pro is that it may make your application more attractive to the bank or even get your offer to purchase accepted above another, as the bank will be satisfied that you are a responsible client and the seller will see that you are serious about purchasing the property.
  • Another pro is that it will decrease your monthly bond repayment costs.
  • A con is that you will have less funds available to upgrade or beautify the property and your security cushion for a rainy day will have to be rebuilt.

It’s important to note that as the economy goes through cycles, there are times where banks do not offer 100% bonds, or they may not extend a 100% bond to you due to your financial health, in which case you will be required to pay a deposit in order to secure the property.

Furnishing & Moving Costs

Once you have secured the property, you’ll need to make the property liveable. Depending on your situation, you may already have furniture and appliances, or you could have purchased a fully furnished property. If not, you’ll need to kit out your new home, and this can be costly too.

Then, you’ll need to move your furnishings into your new home. If you have friends and family that can assist your move for free, great, but if not, you’ll need to enlist the services of a moving company. This can be a costly item and it is recommended to do your research in advance, as there is a wide range of options and costs for moving house.

Repairs & Renovations

Next on the list of expenses when buying a house are home improvements, repairs and renovations.

If your new home is exactly to your liking, great. If not, you’ll need to allocate funds to renovations and to redecorate. This could be major renovations such as changing the internal structure of the property or minor improvements such as painting the property, replacing old and worn fixtures with new ones, and generally updating the atheistic to suit your taste. Sometimes, homes are sold in perfect condition. Other times, they may need a bit of fixing up. Remember to set aside some money for any unforeseen repairs, just in case.

One thing to keep in mind regarding items like blinds, shutters, window treatments and light fittings, is that you address them in the offer to purchase. It is essential that the fixtures and fittings which the seller will be removing from the property are noted in the contract. Discuss this with your estate agent to be sure that you are covered on this item as having to replace items one thought were already included in the sale, could turn into a costly business.

Setting Up Your Utilities

A final cost of owning a home to take into account, are the utilities. If you’re buying a freestanding property, you’ll need to register for your telephone line, internet connection and water and in some cases, your electricity connection. If you are buying a new free standing house, you will have to order a refuse bin from the municipality. These costs will vary depending on the area, but you can budget roughly around R3000 – R5 000. Should you wish to install a pre-paid electricity meter in your new home, this would cost around R4-5000. Once set up, these utility expenses will become monthly costs.

Monthly Costs of Owning a Home

Once you have secured the property and it’s officially in your name, you’ll then incur monthly expenses. These on-going home ownership costs, often billed on a monthly basis, are over and above the bond repayment cost and need to be calculated as a whole. The monthly expenses of owning a home include:

Rates and Taxes and Levies

Each month, your property will incur monthly costs for rates and taxes and possibly levies too. These are payable in addition to your bond repayment cost and should be taken into account when you are considering your property type and affordability. You may be able to afford a certain property’s bond; however, the rates and levies end up pushing the total property expense outside of your affordability bracket.

  • If you have purchased a freestanding property, depending on the size of your property and the area that it is in, your rates and taxes can be anywhere from a few hundred to many thousands of rands per month. In addition to the rates and taxes, you will also have to cover refuse removal, water consumption and sewerage usage. The costs are calculated on the value of the property and on the consumption of the household and you should request your estate agent to send you a recent bill so you can easily work them into your affordability calculations.
  • If you have purchased an apartment or sectional title, the block’s body corporate will set a fee that needs to be paid each month for general maintenance and upkeep. Keep in mind that a special levy could be raised by the trustees at any time should the need arise for urgent repairs, for example, so always make provision for un-foreseen increases.


Almost all home loan lenders will require the property owner to take out insurance policies. Bond Protector Insurance and Homeowner/Building Insurance policies are required for the loan, in order to cover the replacement costs, ie the “bricks and mortar” of the property. Most property buyers will in addition, take out household insurance to cover replacement costs of all items within the property in the event of theft, disaster, fire etc. These insurance costs are difficult to estimate as there are many factors involved.


It’s vital to keep your property, your belongings and your loved ones safe. Generally, existing freestanding properties will have an armed response security alarm system fitted but this is probably not so, for new properties. Installing your alarm is a once-off setup fee that includes an ongoing monthly subscription.

If you are purchasing a freestanding house, remember to calculate this within your monthly cost estimates. Before purchasing the property, discuss the general safety of the area with your estate agent and take note of the security installations in the proximity of the property you are buying.

Property Maintenance Costs

Once you have acquired the property and taken occupation and furnished it and set yourself up in your new home, you’ll be met with ongoing costs on top of the bond repayment and the ongoing monthly costs. These will include costs for ongoing maintenance, which is paramount should you be purchasing a freehold property and also relatively important, in sectional title properties.

Prepare Yourself for the Additional Costs of Buying a House

Purchasing your first home is a big and very exciting step, and the financial commitment can feel totally overwhelming. With the right planning in place and understanding of the fees for buying a house, you’ll be able to budget for all costs involved, leading to clarity and confidence.

Even though there aren’t actually any hidden costs in buying a home, the additional charges can take one by surprise, so prepare yourself as much as possible by educating yourself and planning finances accordingly.

If you would like a clear idea of the total costs for your situation, work with your estate agent, TEAM HOT PROP who will be able to provide most of this information.

Do you have any questions about the hidden costs of buying property? Post them below!


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