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.