Industry participants working in the distressed property sector have observed a noticeable shift in bank behaviour over the past year. While sales in execution remain an important recovery tool, there are growing indications that banks are increasingly viewing them as a last resort rather than a preferred outcome.

One reason may be the increasing complexity surrounding reserve prices and property valuations. In execution matters, Rule 46A(9) requires courts to consider an appropriate reserve price, often linked to the property’s market value. Yet market value itself is not always easy to define. Listing prices, historic sales, and actual buyer demand can vary significantly, particularly in a changing property market.

At the same time, many distressed properties carry substantial outstanding debt. By the time arrears, legal fees, recovery costs, and execution expenses have been added, the amount owed can exceed what the property is capable of achieving in the market. Where this occurs, any shortfall generally remains the responsibility of the homeowner.

This reality appears to be encouraging a more practical approach. Rather than relying solely on auctions, banks are increasingly willing to consider structured alternatives that offer greater certainty around pricing, occupation, and timelines. A well-managed private sale can often reduce risk while improving the overall recovery outcome.

For homeowners, this highlights an important reality: the earlier a problem is addressed, the more options are usually available. Once legal proceedings begin, costs escalate rapidly and opportunities to negotiate become increasingly limited.

While sales in execution remain an essential part of South Africa’s legal framework, current trends suggest that cooperation, structured negotiations, and private sales are increasingly being viewed as viable alternatives where they can deliver a better result for all parties involved.

RRA Positioning

Resolve Realty & Assist works with homeowners, banks, attorneys, and investors to structure practical solutions before legal costs and execution proceedings erode available equity. The focus is always on reducing risk, protecting value, and achieving the best possible outcome for all stakeholders.