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Sectional Title Re-sales continue…
By arlene | April 1, 2008
Marketing is then undertaken on a similar basis to that of any other residential property but aimed at the appropriate target market. Try to avoid pitfalls. A common one is that owners expect to be paid an occupational rental when the buyer moves in, if transfer of ownership has not yet occurred. In the excitement of selling, however, they sometimes forget about the monthly levy. Be sure to discuss this and make it clear in the sale agreement which of the parties is to pay this. Another relates to disclosure by the seller of any special levy likely to be imposed. Occasionally, this will be a reason for selling but is often not divulged. The keeping of pets and animals is another problem area. Just because an agent has seen a dog or cat in the complex, it does not give them the right to assume that this is permitted. Ask! Get a copy of the rules, study them. There may be a rule that a one-bedroom unit may have only one occupant and therefore could not be sold to a married couple!
Get a list of exactly what is covered by the monthly levy to avoid any surprises. If any services such as gardening are included, get all the details, down to the number of hours or even minutes which will be provided. Get to know the chairperson and trustees or managing agent, even the caretaker, if there is one, so that if a question comes up which requires an answer but has you stumped, then at least the right person can be contacted quickly and the correct response will be forthcoming. A list of frequently asked questions follows. Answers will vary. Each complex has different answers to the same questions. Make an appropriate check list to ensure quality professional service.
When selling flats or apartments, particularly in a high rise development, certain provisions apply to rent-protected tenants who are 65 years old or older. Note that:
- The seller must notify the body corporate immediately of any change of ownership of the section now sold.
- Transfer can only be effected if the seller has paid all monies owing to the body corporate; or
- Has made the necessary arrangements to do so to the complete satisfaction of the body corporate.
If however the unit is rent-controlled and is occupied by a lessee:
- Who has concluded a lease agreement with the developer; and
- Who is 65 years old or older; and
- Who was in occupation of the unit at the time when the developer applied to the local authority for approval of the scheme; and
- Whose income does not exceed the maximum amount prescribed for rent-protected tenants.
Then it may only be sold subject to the Lessee’s right to remain in occupation of the unit for so long as his/her income does not exceed the maximum in Paragraph 4 above.
There are other provisions which may apply if the building is rent controlled—get legal advice in such cases.
According to the Sectional Titles Act, certain information must be disclosed to every prospective purchaser. Purchasers would fall into this category if they were contemplating making an offer.
The mandatory information to be provided is:
- The rules governing the scheme. Usually available from the seller or trustees.
- The names of the trustees.
- The name of the managing agent—if applicable.
- The amount of levy payable for the unit.
- Amount of any increase contemplated.
- The extent of provision for maintenance, etc.
- Any extensions to the scheme which may be contemplated must be recorded in the agreement of sale.
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Sectional Title Re-sales continue…
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- Sectional Title: The Pros and Cons part 3
- The Completion of Mortgage Loan Application Forms
- Housing Development Schemes for Retired Persons Part 3
- Sectional Title: The Pros and Cons Part 4
- Housing Development Schemes for Retired Persons Part 2
- Housing Development Schemes for Retired Persons Part 1
- Market Valuations continue...
- Sectional Title: The Pros and Cons part 1
- Selling Sectional Title Off Plan
Topics: Agent, Development, Market, Property, Rental, Residential, Sale |
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