The legal aspects of living in an estate

Private Property South Africa
Private Property Reporter

Lisa Boniface talks about the legal aspects of living in an estate, including which bodies are responsible for running the property.

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Presenter: So, with Win a Home now in full swing here on Afternoon Express, we are transforming ourselves into experts in all things estate living. We're exploring various aspects related to buying and living on estates. And today, we discuss legal aspects related to living in an estate. Joining us today is Lisa Boniface. Welcome.

Lisa Boniface: Yeah, thanks for having me. It's nice to be back here.

Presenter: So lovely to see you again. Yeah, great. Now, I want to know,

Q: In terms of running the properties, what is the main body responsible for, either the freestanding or the sectional title within an estate?

Lisa Boniface: Okay, so Jeannie, let's start with the freehold. That's run by the homeowner's association. So, the developer forms a non-profit company under the company's act. And that's governed by a memorandum of incorporation. And that authorizes a set of rules. So generally, those rules are governed and controlled by your homeowner's association. And in your sectional title, you deal with the body corporate. And the body corporate is formed as soon as one of the units is transferred from the developer's name into a new owner's name, the body corporate comes into existence. And every person that buys into a sectional scheme becomes a member of a body corporate.

Presenter: Automatically?

Lisa Boniface: Yes.

Presenter: Okay. Now, I want to know a little bit more detail, so let's break it down. Let's go to the homeowner's association. So I assume that's just homeowners?

Lisa Boniface: Yes.

Q: What are their roles, their obligations, their responsibilities? And what exactly does it mean to be part of the homeowner's association?

Lisa Boniface: Okay. So what the homeowner's association controls and administers is the communal property in an estate. So for instance, your clubhouses, your golf courses, the streets, all the communal areas that everybody utilizes in that particular estate. They ensure the governance of those. They ensure that a levee is provided for and money is collected, and the upkeep of all of those items are controlled by them. And what you find as well is the homeowner's association becomes the owner of those communal areas.

Presenter: All right.

Q: But a homeowner's association wouldn't then be involved in a neighbor's developments or renovations or anything, or do they also have a say?

Lisa Boniface: Well, remember like I said to you before, Jeannie, there is architectural guidelines. And when you buy into an estate, you buy into their rules. And they would then control those rules through their memorandum of incorporation, which authorizes things like house rules and estate rules and architectural guidelines. So they would ensure good governance of those items.

Presenter: So, for example, if everybody's house in the estate has to be white, you can't go and paint yours pink.

Lisa Boniface: No, definitely [laughter]. Exactly. They want us to live in harmony.

Presenter: Yeah. I think I love when it's like that. Now, let's look at the body corporate.

Q: How does that differ, and what exactly are then the roles, the obligations, and the responsibilities of the body corporate?

Lisa Boniface: So, the body corporate is really responsible for ensuring that the rules, managements, and conduct rules are complied with, that they establish a fund, and that the money's collected in that fund. And this then goes to the upkeep of the property and running the body corporate essentially. So that's exactly what they're involved with is just running the common property, the day-to-day running of a scheme, as well as establishing a fund, controlling that fund, and then ensuring things are looked after.

Presenter: Okay. So, let's have a look at an estate like Eye of Africa, for example, where there's sectional title and there's free-standing homes.

Q: Who is then the body, and what is the difference? How can they work in harmony together?

Lisa Boniface: Okay. So, generally, when you buy into an estate, and you purchase a sectional title unit in that estate, you automatically become an owner, or you have to acknowledge and consent to becoming an owner of the homeowner's association. So the homeowner association is the controlling body. And that would mean then that you would need to comply with their rules, with their memorandum of incorporation. So they're definitely the controlling body, and you would need to comply with their rules, as well as your own management and conduct rules within your scheme. And there can also be two levees payable in that regard. So that's something that a buyer must definitely look into when buying into an estate. If you are buying into a sectional scheme, you'll have levees for the body corporate within your scheme, as well as for the homeowner's association to look after those communal areas as well.

Presenter: Brilliant. Thank you so much for talking to us.

Lisa Boniface: No, it's a pleasure. Thanks for having me [laughter].

Presenter: I'm definitely very clued up now on property. Now, the grand prize in Win a Home is your choice of one of three fully-designed cluster homes at the Eye of Africa Golf and Residential Estate.

To enter the grand prize competition, visit privateproperty.co.za today, and click on the Win a Home icon to answer an easy question and vote for your favorite design duo.

Click here to enter the Win a Home competition

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