FNB and Khayelitsha-based housing support office partner to help township homeowners resolve title deed problems

Many lower-income homeowners in South Africa have problems with their title deed. Government’s extensive primary transfer backlog, coupled with an inaccessible and expensive formal property transfer system, have resulted in millions of South Africans owning homes for which they don’t possess clear legal title.  This undermines their security of tenure and compromises their ability to pass these homes on to their heirs, increasing the risk of conflict and disputes. Properties without clean, undisputed title, cannot be mortgaged either by buyers who need finance to afford the property or by homeowners who wish to build or improve their properties. This limits the economic potential of these property assets. Moreover, disputes over property ownership are common, creating uncertainty and instability in vulnerable neighbourhoods.

This is the challenge the Khayelitsha-based Tenure Support Centre (TSC) aims to resolve. The TSC is a housing support office which provides hands-on assistance to individuals with title deed problems. It opened its doors in mid-2018 and, with the support of FNB, now operates its walk-in support office from the FNB branch in Khayelitsha Mall.

“FNB has provided us with a professional, safe space to operate from and an easily accessible point of contact for our clients to seek assistance. Operating from a bank branch also reinforces our message to clients that their homes and properties are important financial assets. Sorting out any title deed issues is the first step in maximising the value of that asset”, says Lisa Hutsebaut, the TSC’s conveyancer

The TSC deals with a range of title deed issues, the most common being the transfer of properties from deceased owners to rightful heirs, regularising informal or off-register sales, and assisting clients who have never received their title deeds from the Government.

The TSC, which started out as a pilot, action-research initiative in 2018, has grown into a more permanent housing support office serving clients in Khayelitsha but also surrounding areas. It initially operated out of a community centre which was vandalised during COVID. The team tested a remote working model, but there was a clear need for a trusted, physical space for clients to deliver and sign the necessary legal paperwork.  “The face-to-face interaction with clients is also critical to building trust in the process. FNB really stepped in for us when we found ourselves at a crossroads, without a space to operate from and unsure if the project could continue,” says Illana Melzer from 71point4 Consulting, co-founder of the TSC project.

“We’re excited about the potential to replicate this model in our other branches and extend access to this critical service to more homeowners across the country. We are well aware that the title deed crisis in South Africa materially constrains wealth accumulation and economic development in so many low-income neighbourhoods. It also slows the growth of our future market for mortgages.” says Mfundo Mabaso, Growth Head at FNB.

To date the TSC has interacted with over 1 000 walk-in-clients, successfully resolving title deed problems for over 300 of these clients. At the same time as responding to individual walk-in client cases, the TSC runs projects to address underlying structural problems in the market. An example of this includes a large-scale enumeration and subsidy beneficiary validation project conducted with the City of Cape Town in 2019 involving 780 properties in Makhaza, Khayelitsha where title deeds had not yet been issued by Government. Almost 500 of these properties have now been formally transferred from Government to the rightful owners.

The TSC is currently a joint initiative of 71point4 Consulting and the Centre for Affordable Housing Finance in Africa, with funding provided by Oppenheimer Generations and the First Rand Empowerment Foundation Trust.

To find out more about the TSC project, visit: https://titledeed.org.za/ or follow the TSC on Linkedin, Facebook or Instagram.

For help with a title deed issue, clients can contact the TSC on Whatsapp (065 041 6832) or email (sona.nongqayi@titledeed.org.za).

The TSC currently serves clients with properties based in Cape Town but clients based elsewhere are welcome to contact the team who will do their best to try and assist.

Any questions related to the TSC project can be directed to:

  • Illana Melzer –  illana@71point4.com
  • Kecia Rust – kecia@housingfinanceafrica.org

Simphiwe’s deceased estate transfer: Case timelines and key milestones

A standard question we get at the TSC is: How long does it take you to resolve a case? Our standard answer is: “it depends on the case”. Various factors contribute to the duration of a case, including its complexity, the length of time required for administrative processes such as those managed by the Masters Office, and the responsiveness of our clients, including the speed at which they and other parties involved can sign necessary documents.  

To illustrate this, we’ve mapped out the timeline and key milestones for a deceased estate transfer case that the TSC has recently resolved. You can read the background to Simphiwe’s case here.

The case initially seems to be a straightforward deceased estate transfer of one property. It turned into a significantly more complicated case as the estate actually included two properties. 

Simphiwe, the client who approached the TSC for assistance, did not mention the second property. He did not consider it to be his – his niece was living in the property and he regarded the property as belonging to her. 

Once the conveyancers established that the deceased owned a second property, the TSC had to re-start the reporting process at the Masters Office. This property would be included in the estate and transferred to the client. He would then donate the second property to his niece. 

This particular case was on the TSC’s books for almost 21 months, with almost eight months of that waiting on information from the Masters Office in order to proceed. 

High-level illustrative summary of case

Ending a 20-year battle to get a title deed

Simphiwe is looking forward to building a formal subsidy house through the People’s Housing Process (PHP) after the Tenure Support Center (TSC) helped him get a title deed for his property in Site B, Khayelitsha.

“I’m waiting for the PHP chairperson to ask me to dismantle my shack to make way for an RDP house,” he said.

Simphiwe lives off his disability grant after a car accident in Langeberg near Koeberg left him unable to work. He stays with his wife in a dilapidated shack that is prone to leaking and becomes uncomfortably cold during the winter months. His property used to belong to his mother who was allocated a serviced site. She received the title deed for the land from Government in 1999, just a few months before she passed away.

“To register with the PHP, I was required to produce a title deed first. Housing officials said I could not apply for an RDP house while the property was still registered in my mother’s name. They advised me to consult lawyers,” Simphiwe described.

Simphiwe, being his mother’s only surviving heir, was entitled to take transfer of the property following her death, but he struggled to do so due to the costs involved. However, thanks to the help he received from the TSC, Simphiwe recently took transfer of the property.

“No one could help me until I met a PHP chairperson who introduced me to the TSC,” Simphiwe said.

He first went to lawyers in Plein Street in Cape Town to ask them to register his mother’s property in his name. They told him he must pay R3 000 first and then R5 000 at a later stage. Simphiwe simply could not afford that amount. 

“I could not give them my whole disability grant, otherwise I would be left without money for food. They said they could not help me if I could not afford to pay them,”  Simphiwe told us.

Another lawyer said he would have to pay R13 000 for the transfer. ”When I asked him if he didn’t give a discount to people with disabilities, he said no.”

Simphiwe did not have to pay to get his title deed through the TSC; the TSC provided access to free legal services through its partner STBB. Because Simphiwe is indigent, the TSC paid for out of pocket expenses of R1 300. 

Simphiwe described his joy when he eventually received transfer of the property through the TSC. “I went down on my knees and thanked God for what He did for me. I feel happy because my life will change. I will move out of my shack and stay in an RDP house in the near future.”

“I battled a lot to get the title deed. When I finally got it, it was like a weight had been lifted off my shoulders.”

He is pleased with the way TSC staff handled his title deed issue from start to finish, he said. “I’m already recommending TSC to other residents who are looking for title deeds.”

Persistently inefficient

Ms. D, a 54 year old domestic worker, first approached the Transaction Support Centre in August 2019 asking for assistance with correcting errors on her title deed – both her surname and date of birth were incorrect. The client received the property from Government in 1992, pre-democracy. It is unclear what identity document the conveyancer used at the time to prepare the transfer; the client would have likely only received a green bar-coded Identity document post-1994. Regardless, the title deed needed correction as, in its current format, the client would not be able to legally sell, transfer or leverage her property for finance due to the errors.

As per Section 4(1)(b) of the Deeds Registry Act, 47 of 1937, the Registrar “may correct an error in registration in any deed or document registered or filed in a deeds registry pertaining to: the name or the description of any person; the name or description of any property; conditions affecting such property.” [1] The application must be brought to the Deeds Office by a conveyancer acting on behalf of the client, and documentary proof of the “true state of affairs” must be provided. This is where Ms. D’s 18-month process with the Deeds Office and Home Affairs started.

The journey

The full process is outlined step-by-step in the illustration below. But, in summary, Ms. D’s application was rejected twice by the Deeds Office (DO), first because the DO wanted an unabridged birth certificate as means of proof of the client’s actual surname and date of birth. When this was received, after two separate trips to Home Affairs and a three-month wait, the conveyancer lodged a second application to the Deeds Office. This was rejected again, this time because the DO wanted to see a vault copy of the client’s birth certificate as means of proof that her personal details had changed. In July 2020, the client eventually managed to make the trip back to Home Affairs after the lockdown to apply for the vault copy. The application was submitted and she was told to wait another three months. By October 2020 when the client went to follow up on her application, she was told that vault copies still need to be requested from Pretoria. Probably in an attempt to ease the client’s distress, the Home Affairs clerk gave Ms. D another unabridged birth certificate and sent her on her way. Not one to back down, Ms. D made a fifth trip back to Home Affairs in December 2020 to follow up on the vault copy only to be told that she is in fact “too old to have a vault copy”, and that “the Deeds Office should not be looking to Home Affairs to remedy their mistakes”.

Finding resolution

At this point the TSC in consultation with our conveyancers decided that the only way to find resolution was for the conveyancer to meet with the Deeds Office examiner in-person to set out the client’s full case history and determine a way forward. Fortunately, this was successful and the Deeds Office agreed to accept the client’s unabridged birth certificate as means of proof.

After a long and convoluted 18-month process consisting of two S4(1)(b) applications by conveyancers, two Deeds Office rejections, and five separate trips to Home Affairs costing the client R22 each time in taxi fares, and one unnecessary vault copy application costing the client R75 (not an insignificant cost considering her total monthly income is R1,200), Ms. D received confirmation that her application was registered in March 2020. Finally, she would have a title deed with her correct details on it.

This case highlights the lack of synergies between Home Affairs and the Deeds Office, as well as the rather outstanding inefficiency of Home Affairs, and the resulting impact this has on indigent clients. Ms. D was ‘fortunate’ that she had the time and flexibility to do several trips to Home Affairs, but this is because she is only employed two days of the week. If she had full-time employment no doubt she would have had to take a day off work each time she needed to go back. Imagine how much more this process would have cost her then?

Going forward

While the TSC is grateful that it was able to resolve this particular case, there is clearly a need to drive systemic change within key administrative departments like the Deeds Office and Home Affairs. Improved digitisation and streamlining of processes and systems can help, but recognition of the weaknesses and flaws and a commitment to fixing them is also needed from the Departments’ leadership. As a start we hope to drive this by engaging directly with the Deeds Office for critically needed guidelines as to exactly what documentation would suffice in these circumstances. At present this is completely discretionary. Some clarity in this regard would go a long way in alleviating the evidentiary burden on indigent clients.

Authors: Lisa Hutsebaut & Jessica Breier

References

[1] LexisDigest. Involved intricacies. 25 August 2011. Available: https://www.ghostdigest.com/articles/involved-intricacies/53898