Vincent is a journalist who we’ve worked with recently to document some of our client case studies. In a recent conversation he mentioned his own experience of buying and selling a property informally which we asked him to write about. Vincent’s story echoes that of many of our TSC clients and demonstrates how and why informal transactions of RDP properties took place in the past, and continue to take place to this day. Perhaps most importantly his story reflects the risks buyers carry when engaging in informal transactions as evidenced by the length of time it took him to resell the house and the fact that many potential buyers became uninterested as soon as they found out he didn’t have the title deed. Here is his story from his own perspective.
I worked as a Senior Communications Officer on a contractual basis at the Western Cape Department of Transport and Public Works until November 2008. After my contract expired, I feared that I would not be able to continue to stay at Hibiscus in Brackenfell, where I rented a flat. Accordingly, I put up notices on spaza shops that said I wanted to buy an RDP house in Wallacedene. An RDP house owner saw the notice and phoned me to say he was selling his house for R24 000.00.
When we met, he showed me an RDP house which was still under construction but about to be completed. I moved into the house on May 26, 2009 and paid him his money in the presence of his wife, an area committee and a local businessman, who had transported me to the Bank in Tygervalley to withdraw the money.
I took down the names of the committee members and gave them money to buy a ‘cool drink’, witness and approve the sale. It was a standard practice to ask community leaders to witness such house sales.
Buying an RDP house without involving community leaders meant that no one would stand up for the buyer when the owner returns to claim his or her house. The community leaders asked him to confirm to them that he was indeed selling the house to me, and he did so. The committee counted the money and handed it to him.
The house owner gave me his ID, his wife’s ID and a letter that confirmed that the house belonged to him and his wife. I believed that these documents served the same purpose as a title deed and a proof that I got the house from its owner.
I was happy that I had my own place, and that I would no longer have to pay rent because I was unemployed.
The inside of the house and windows still needed to be painted and varnished. Construction workers, painters and other workers often came into the house to put final touches here and there.
I paid a professional electrician to wire the house, a welder to fit the house with burglar doors and burglar windows and a handyman to tile the floor. I also hired a local plumber to link my water pipes to underground municipal water pipes so I could get water inside the house.
I always feared that the owner might come back, reclaim the house and refund me. However, I drew comfort from the fact that he was unemployed and as such would battle to raise R24 000 and repay me.
There were rumours that the government might evict me because I moved in before the house was officially handed over to the owner. Some residents said government officials would visit each new RDP house just before the official handover to check if its occupants were legitimate owners. These rumours worried me.
I asked two lawyers how I could transfer the house to my name, and they both said I could only do so after five years or so. Even after such a period, I would have battled to register the house in my name because the owner was no longer staying in the Western Cape.
I ran out of my savings and started to do freelance work for newspapers such as the Daily Sun, Daily Voice and The Cape Argus. I battled to get stories to sell to newspapers in Wallacedene.
Consequently, I made a decision in 2011 to sell the house and relocate to Khayelitsha. I put up notices that said I was selling the house on local taverns and spaza shops, and people came to view it.
Most of them wanted to buy the house but changed their minds as soon as I said I didn’t have a title deed.
One potential buyer said: “Buying a house without getting a title deed is like throwing your money into the sea because the owner may return and reclaim the house.”
Since I had no title deed, I battled to find a buyer until 2014, when I told a local restaurant owner that I was selling the house. He knew me very well because I frequented his Tshisanyama to listen to music, eat and have fun. Also, he trusted me because I published some stories about his skirmishes with the police who initially deemed his restaurant illegal.
The restaurant owner said he wanted to relocate his neighbour to my house because he needed more space as he was expanding his business place. Also, he wanted to move his neighbour elsewhere because she often complained about the noise from his restaurant.
I sold the RDP house to him for R75 000, which was the standard price for RDP houses in Wallacedene then. On 26 May 2014 he initially deposited R50 000 into my bank account and subsequently paid the remainder in June. He personally organised a truck and youths to load my belongings and drove me to Khayelitsha, where I rented an RDP house. We never bothered to get people to act as witnesses because we knew and trusted each other. We continued to meet and chat after the sale until he unfortunately passed away due to Covid in 2020.
Vincent does not know who is currently living in the house. However, based on records the TSC could access, it appears that the house was formally registered in the original beneficiary’s name in 2010, after Vincent had already purchased the property informally. It is not clear what, if any, validation process the City followed to validate ownership prior to transfer.
The current off-register owner faces the risk that the registered owner/s could try to claim the property. As evidenced in other cases, local community structures can be effective in discouraging this. But it is by no means that case that off-register owners face no risks. In addition, like Vincent they might find it difficult to sell the house without a title deed. They also cannot use their property to access finance and may not be able to engage with the City as recognised property owners.
Where the off-register owner wants to formalise ownership, he or she can attempt to contact the registered owner(s) and regularise the sale retrospectively. The TSC has helped several clients formalise past informal cash sales. There are two critical success factors: (1) the registered owner needs to be contactable and (2) the registered owner needs to agree to participate in the process.
In some cases where the registered owner is contactable and agrees to participate, he or she will request more money from the buyer. The latter scenario is the risk buyers face when approaching sellers to regularise a past sale. However, when this happens, the two parties reach an agreement and the sale proceeds, often with the off-register owner paying over additional funds.
Some researchers maintain that poor households do not care whether they have a title deed. No doubt in some cases they are right. But the clients who approach the TSC are acutely aware of the importance of a title deed and make a real effort to secure it. Many succeed only because of the assistance of the TSC and its conveyancing partner STBB, who does the conveyancing work on a pro bono basis.