Ensuring property transfers are fair for all heirs

The simplest way to stay evenhanded is to separate the two issues of occupying the house and ensuring that the ultimate value each child receives remains fair.

- Kenny Meiring

There are two options open to you.

Option 1: Sell now and 'be the bank'

This is often the cleanest option because you manage the transaction yourself. The key is to agree on a market-value price. Always get at least two independent valuations and settle on a fair midpoint.

Selling below market value may feel generous, but it creates a deemed donation equal to the discount, and that can trigger donations tax of 20%. It will also not be fair on your other children if one gets a valuable asset at a discount.

Once the price is agreed, a conveyancer draws up a sale agreement and registers a bond in your favour for the outstanding balance. You charge a reasonable interest rate and set a repayment schedule. I recommend that you charge interest at the repo rate +1%, as you do not want this to be considered a soft loan that triggers donations tax.