Strike hits home buyers

The Argus

Closed: Abdullah Goolam, centre, a clerk at the Deeds Office in Cape Town, holds up a notice stating that the office will be closed because of the strike. Photo: Sophia Stander

By Andisiwe Makinana and Mzolisi Witbooi

The public sector strike has halted the buying and selling of properties involving hundreds of thousands of rands by leaving the Cape Town Deeds Office with a skeleton staff.

This comes on top of havoc at schools and hospitals, with Cosatu-affiliated unions threatening a complete shutdown of public services by tomorrow.

Home buyers and sellers, conveyancers, estate agents and the Deeds Office itself have been affected since the office has been all but shut down since Friday, when the strike began.

When the Cape Argus visited the office in Plein Street on Thursday, a security guard said it was shut as workers had been away since Friday.

On Thursday morning there was a notice outside the building which read: "To all Deeds Office clients. Due to industrial action the Deeds Office will be closed on Thursday 7 June 2007 to the public and conveyancers. Clients will be informed about the situation on Friday 8 June 2007".

Numerous phone calls to the office on Wednesday and on Thursday morning were unanswered.

Buyers and sellers, who were already facing lengthy delays in the transfer process because of backlogs, now face an even longer wait.

The Deeds Office is losing thousands of rands in levies on purchase prices and mortgage bonds.

Conveyancing attorney Malcolm Roup of Roup Attorneys painted a bleak picture of the situation.

"Firstly, the Deeds Office cannot operate on a skeleton staff. There are many departments that are interdependent, effectively it's closed," said Roup.

The strike meant no property could be sold or bought at present.

It was resulting in financial losses and great inconvenience, especially to ordinary buyers and sellers whose finances would "go haywire" as they waited for properties to be registered.

"It's got prejudicial results for a person who is buying or selling a property. For example, if the property transfer was to be finalised last Friday and a buyer was packed and had organised moving, that person is stuck and is probably paying occupational interest."

Getting bridging finance was very expensive and the delay meant people would have to pay occupational interest instead of starting to pay their bonds, Roup said.

"A home owner who sold a property hoping to settle his bond and pocket the proceeds of the sale is stuffed."

The crisis also means no income for estate agents, developers and conveyancing attorneys.

"Estate agents can't be paid until a property is transferred and attorneys can't get their money unless the property is registered," Roup said.

Richard Day, general manager of Pam Golding Properties, said the impact of the delays was yet to be determined. "If the strike goes beyond a week, there's going to be bigger problems," he warned.

Bill Rawson, chairman of Rawson Properties and co-director of the National Institute of Estate Agents, said the consequences of the strike and the backlog at the Deeds Office could be severe, especially to the buyer or seller.

"For example, sellers who sold their homes in order to venture into other businesses with the capital may lose huge profits.

"And with the new Credit Act coming into effect, it is going to be more difficult to remedy the situation, because it has become more difficult to borrow from banks."

Meanwhile, pickets were held at government premises today, including the provincial legislature and the Khayelitsha day hospital.

Provincial Health Department spokeswoman Faiza Steyn said Khayelitsha, Tygerberg Hospital and Groote Schuur had the largest proportion of staff out on strike.

But only 646 of 26 000 staff around the province were taking part in strike action. - Additional reporting by Leila Samodien and Zara Nicholson