Joburg Deeds Office Closure Triggers Cash Flow Crisis for Property Sellers and Estate Agents

Johannesburg – The ongoing closure of Johannesburg’s Deeds Office has disrupted property transactions significantly.

As a result, sellers are unable to access their proceeds, and estate agents are facing delays of several months for commission payments that are usually processed within weeks.

Earlier this year, a notice on 25 February confirmed the indefinite shutdown of the Deeds Office after the Department of Labour deemed the building’s elevators to be unsafe.

This situation has left employees unwilling to climb the 26 flights of stairs, effectively stopping all property-related operations.

The disruption has created a serious cash flow issue for thousands of property sellers and estate agents.

What should generally be a standard registration process taking six to twelve weeks now faces additional delays of at least two to three months.

Jason Joffa from bridging finance company Lamna commented this week: “The closure affects the entire sales process – everything is at a standstill, and people need their money.”

Joffa further noted: “While the Deeds Office relocates to temporary premises, sellers are left waiting for critical proceeds.”

“Lamna Financial provides a bridging solution for those experiencing extended delays in property transactions.”

The situation for estate agents is similarly challenging. Commission payments are only processed after property transfers are registered, leading to prolonged waits for agents who have finalized sales.

According to Joffa, Lamna supports both sellers and agents in overcoming this crisis.

“For agents confronting the registration backlog, Lamna can advance up to 70% of their commission,” Joffa explained.

He emphasized that the process is designed for a fast turnaround – agents can contact Lamna directly or through their conveyancing attorney, who signs an undertaking, allowing payments within 24 hours.

“Estate agents face ongoing business costs and cannot afford to wait months for commission on completed sales,” Joffa remarked.

“Our bridge financing helps them manage cash flow while addressing the administrative backlog.”

For property sellers, Lamna offers advances up to 80% of sale proceeds, alleviating various financial pressures during this extended waiting time.

This financial support includes securing deposits for subsequent property purchases, covering emigration costs, or fulfilling other financial responsibilities.

Property bridging finance can accelerate the sales process, particularly when homeowners’ association levies haven’t been settled or municipal rates clearances are pending, issues that must be resolved before lodging properties at the Deeds Office.

“Property developers are especially affected,” Joffa observed.

“They incur construction costs on new units that cannot be delayed by administrative processes.”

Sellers can access Lamna’s services directly or through their transferring attorneys.

“This is a cash-intensive industry requiring significant funding,” Joffa noted.

“Lamna’s growth is supported by a robust capital base designed to meet demands arising from administrative delays that create urgent cash flow needs, allowing us to act quickly.”

As the Deeds Office sets up operations in a temporary venue, Lamna expects sustained demand for bridging finance while the backlog of delayed registrations is resolved.

“We cannot control the timeline for the Deeds Office’s reopening, but we can ensure that sellers and agents don’t have to put their lives and businesses on hold while awaiting a solution,” Joffa stated.