Understanding
Sectional Title Properties
If
you’re house hunting, and you’re considering buying an apartment or unit in a
complex, chances are
you’ll be buying a sectional title, rather than a freehold
property.
“It’s
important to understand the obligations that come with a sectional title, so
that you factor these
in to your budget and planning,” says Fanie de Lange,
Non-Metro Sales Manager at ooba, South Africa’s
biggest bond
originator.
A
freehold is a free-standing property. The owner is entirely responsible for its
upkeep and can make
any decisions about what to do with it. A sectional title
scheme is governed by the Section Title Act,
and allows for a number of people
to own parts of a single property – like a block of flats.
“Obviously,
when you own an apartment, your responsibility for the property doesn’t begin
and end at
your front door,” says De Lange. “The parking garage, communal
gardens, walkways, security, building
exterior and many other elements are the
joint responsibility of all the owners.”
With
this responsibility naturally come obligations. The interests of the members of
the sectional title
scheme will be represented by a body corporate, which will
have an established list of rules and
regulations governing things from pet
ownership and noise levels to maintenance requirements and the
monthly
levy.
“Familiarise
yourself with the rules and regulations before making an offer to purchase,
because you
might find that some are in conflict with your lifestyle or that the
financial obligations are beyond your
budget as a new homeowner,” says De Lange.
“Remember that you are legally bound to honour the
requirements of the sectional
title.”
In
addition to budgeting for the monthly levy, you should also be aware that many
sectional titles’
regulations allow for a special levy to be charged if there is
a need for renovations to the building
that falls outside of normal
maintenance.
“Make
sure that if there is such an allowance, you would be able to afford it, and
it’s also worth
comparing the levy on the property you are interested in to
others of the same value and with similar
shared areas, so that you have a good
understanding of what you’re budgeting for,” says De Lange.
“You can also ask to
speak to the head of the body corporate to find out if there are any planned
special levies in the near future, and check the financials to make sure that
the body corporate is
being effectively managed.”
While
sectional title adds another level of complexity to property ownership, it also
adds a degree
of reassurance. While you will be paying your levy every month,
you will also benefit from the
maintenance of common areas and exteriors – all
of which would be your responsibility if you
purchased a freehold.
The
actual purchasing process is like any other. “Your bond will be registered as a
sectional title
bond, and the registration and transfer all take place in much
the same way,” explains De Lange.
“Once you’ve moved in, if you want to be
involved in the decisions that are made about your
property, it’s a good idea to
get involved in the body corporate.”
ooba has
experienced experts who will assist you in obtaining the best finance to
purchase your
property, whether it is a freehold or a sectional title, and will
help you to understand the obligations
and requirements.
OOBA
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