Neighbourhood 3 FEBRUARY 2019
PROPERTY & LIFESTYLE
Sectional sensation Security, affordability, convenience, amenities, lifestyle... what’s not to like about investing in a sectional title property, page 2
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PROPERTY FOCUS: SECTIONAL TITLE
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PROPERTY NEWS
3 FEBRUARY 2019
Neighbourhood
Property focus
BUH-REIN ESTATE, CAPE TOWN
SANDTON GATE, JOBURG
On the rise
The appetite for sectional title property in SA is growing faster than the demand for freestanding homes. This is driven by a quest for security, lifestyle, convenience and affordability. WORDS: KIT HEATHCOCK & MIRIAM MANNAK IMAGES: SUPPLIED & SHUTTERSTOCK
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ith the rising popularity of estate living in South Africa, sectional title property purchases are becoming increasingly popular. In fact, sectional title purchases in South Africa have grown by up to 5% per year since 2003, according to a recent Lightstone Property report. Kent Gush, MD, Kent Gush Properties, says “South African buyers are becoming more accustomed to apartment living and we have definitely seen a trend towards this and away from the traditional free-standing home.”
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David Britz, sales and marketing director, Multi Spectrum Property, is not surprised. Firstly, it’s easier to source finance for a sectional title property. “New developments give the potential buyer the opportunity to acquire a property with a 100% loan facility from the financial institutions as developers arrange these packages with the financial institutions when they go to the market. Very often a potential buyer can afford the monthly bond instalment on a property, but doesn’t have that 10% deposit, but with 100% financing, entry into the property market is just so much easier as you don’t need any deposit or sometimes only a small securing deposit.”
Craft Homes marketing manager Jessica Cabanita agrees. “Sectional title homes are usually less expensive and provide less hassle because one typically buys off plan,” she explains.
What is sectional title? Examples of sectional title schemes are apartment buildings, secure estates and other developments which include shared communal areas and facilities. When you buy into such a complex, you purchase full ownership of a section plus an undivided share of the common property. As owner of a section you automatically become a member of the body corporate of the sectional title scheme, which owns and manages the common property. Monthly levies cover maintenance, security, building insurance and other related costs.
What to consider “The first thing to do is make sure you understand the obligations of an
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3 FEBRUARY 2019
Neighbourhood
PROPERTY NEWS
WHAT IS THE BODY CORPORATE?
SOME SECTIONAL TITLE DEVELOPMENTS ACROSS SA
According to Just Property CEO Paul Stevens, “The body corporate is made up of all the owners and governed by a board of trustees. All the relevant information is in the Management and Conduct Rules for each scheme which every estate agent should make available to buyers in the scheme.”
Gauteng • Sandton Gate Precinct • Steyn City • The Houghton • The Saxony Sandton • Kikuyu at Waterfall • The Polofields at Waterfall • Ellipse at Waterfall • The Blyde
The body corporate of a scheme comes into existence as soon as the sectional title register is opened and continues to exist as long as the scheme continues.
Western Cape • The Aster • Val de Vie • Buh-Rein Estate • Clara Anna Fontein • Sitari Country Estate • Paardevlei Square
Stevens suggests, “It’s to the advantage of owners if the body corporate includes an estate agent who is well versed in the relevant legislation – there can often be a conflict between owners in sectional title schemes and the body corporate (whose function is to manage and maintain the property) e.g. who pays for what.” POLOFIELDS, WATERFALL ESTATE, JOBURG
owner of property under the Sectional Title Act 95 of 1986, which prescribes management and conduct rules that apply to all sectional title schemes and covers the framework for running such a scheme,” advises Jarryd Phillips, Berman Brothers Properties. Next is to look at the rules established by the body corporate for the scheme. These may vary, but common things to check are whether pets are allowed, is short-term letting – for example AirBnB – permitted, and what restrictions there may be to home alterations or improvements.
Checks to do According to David, it’s essential to check the financials of the body corporate. Establish which ordinary and special levies are payable in respect of the unit you are considering buying, and find out whether there’s a chance that a special levy will have to be called for in the near future. Special levies can be voted in by the trustees to cover additional or unforeseen expenses not included in the monthly levy, such as installation of a new security system or major renovations to common property. When looking at the financials, make sure the sectional title scheme is solvent: are there excessive outstanding levies which might compromise the upkeep of the property? Look to see if the body corporate runs things themselves or whether a third-party
managing agent is responsible for everyday matters. Speak to current residents to see if they’re happy with the management of the scheme. “Sectional title homebuyers should look out for a ‘right of extension’ clause in their sale agreement,” adds Phillips. “It could make a big difference to your property’s future value.” This clause reserves the right of the developer or body corporate to extend the scheme by adding further buildings at a later date. A right of extension must be registered with exact details of how many further sections will be built, and where, how they will affect existing sections, and also specify a time frame.
Advantages and disadvantages Sectional title units usually have the advantage over freehold properties of the additional security from the shared systems in place. “We’re definitely seeing buyers opt for sectional title units with good security over freehold homes,” says Chris Tyson, CEO, Tyson Properties. There’s also the added bonus of having a community of neighbours who look out for each other and the common areas. They may include
People want more than just a place to stay. They’re looking for a lifestyle. LEON COHEN, CEO, RABIE PROPERTY GROUP
additional amenities such as swimming pools, gyms, clubhouses or other attractions, and typically are popular with those who enjoy a lock-up-and-go lifestyle. Maintenance costs are shared and generally the initial purchase price is lower than a comparable freehold property. A possible downside is that you’re buying into a community with its own rules, which can restrict your freedom to do whatever you want to your property. Decisions about any major changes are made by vote within the body corporate, so you have to be comfortable with community decision-making processes. Because a scheme that is badly run will affect the value and saleability of your investment, it is in the interest of owners to play an active role in the body corporate, both to protect their investment and to get the most from the community lifestyle.
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KwaZulu-Natal • Zimbali • Sibaya Coastal Precinct • Ridge Town Central Port Elizabeth • River Dale at Westbrook
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PROPERTY NEWS
3 FEBRUARY 2019
Everybody needs good neighbours In an ideal world, neighbours co-exist in peaceful harmony, but in reality problems quite frequently arise when the lines blur between who is responsible for which issues WORDS: NICOLA JENVEY
IMAGES: SHUTTERSTOCK
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here are no laws stating you have to be best friends with your neighbours, but living in close proximity with other people inevitably triggers interaction – and when resolving disputes, knowledge about who is responsible for what can limit the stress levels. Building renovations Stavros Anthias, partner, Smith Tabata Buchanan Boyes Attorneys, says building renovations must be conducted in accordance with approved plans and bylaws. However, the view that may have cemented the sale for you is not legally deemed a right and most residential properties can be constructed as double-storey buildings. “Should your neighbour’s extension block your view, there’s nothing you can do about it providing the plans comply with the municipal requirements. However, when bylaws are not followed, neighbours can end up facing off in court to resolve the issues,” he says. Meumann White Attorneys partner Maria Davey says neighbours
also have the right to object to construction projects over the weekends with municipal bylaws stipulating the times during which bashing and hammering can occur.
“This means respecting the neighbours’ privacy, adhering to noise level bylaws, and taking into consideration the impact parking has on those around you,” Anthias says.
Boundaries She adds that disputes over boundary wall demarcations, particularly when the structures were erected before the current owners moved into the property, are best resolved by consulting the original building plans.
Davey explains that where the business impacts on the neighbours’ rights like overpowering cooking smells from a home-based catering company, their recourse is reporting the issue to the local municipality’s planning department.
In terms of trees on the boundary fence, neighbours can legally cut down overhanging branches, but should inform the owner when the roots are damaging the walls or causing other safety and erosion problems. Working from home Municipal zoning make allowances for working from home or running a home-based business. Typically properties have special consents allowing this to happen, but the basic test is common courtesy and communication.
Noise pollution Anthias says this is when the common law principle – specifically that each owner is entitled to “the peaceful and undisturbed enjoyment of their property”, tested against “a reasonable man” premise – and the municipal bylaws play their part in creating a harmonious co-existence. “When neighbours inform each other about upcoming celebrations, it’s unreasonable to expect parties to end at 10pm in line with municipal bylaws. No-one can really object before midnight unless these are frequent disturbances to the peace,” he says.
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