« How to choose Real Estate Agent when Private Property Buying is a bad idea | Main | Take next step to Invest on Property »
Residential Property, Comparing different types
By arlene | September 29, 2008
A buyer has a selection of residential property types to choose from. In South Africa we distinguish between two property types, namely freehold properties and sectional-title units.
Sectional-title properties
Sectional-title units are governed by a body corporate appointed by the present owners. Administration and maintenance of the complex and common property are the responsibility of the body corporate. Those members serving on this body corporate are called trustees and are appointed annually to the position to serve in the interests of the complex.
In a sectional title scheme you buy more than just your unit. While you are responsible for the maintenance of your unit, you share in the costs of maintaining the common property.
The body corporate charges a levy, mainly for:
- Insurance on the buildings,
- to pay the rates and taxes,
- The water consumption of the complex,
- the electricity consumption of all the services except the owner’s own electricity consumption,
- the maintenance of the buildings (on the outside of the units) and the gardens, as well as
- The security arrangements.
The following are examples of sectional-title properties
Flats - High rise units, popular in urban areas.
Townhouses - Townhouses, which became very popular in recent times, is the collective term for:
- Stacked Simplex — Stacked units (simplex units stacked on top of each other), with the entire unit on one level, usually with a communal garden.
- Simplex — One level only, usually with its own garden.
- Duplex — A double storey unit, normally with living areas on ground level and bedrooms and bathrooms on the first floor. In most instances these units will also have a small private garden.
Freehold, or full-title, properties
With a freehold or full-title property the entire stand (erf) and its improvements are normally registered in your own name. While you are responsible for maintenance, you are free to improve and change the property as you like (within the regulations of bylaws and legislation).
The following are examples of freehold properties:
Clusters - These are normally free standing units with an own garden where the unit and the stand (erf) is the sole property of the owner.
Usually an Article 21-company (a registered company without gain), controlled by the Home Owners Association, manages the complex. A levy is charged to cover the expense of the security arrangements (controlling the entrance gates and surrounding security walls), communal gardens (if any) and the upkeep of the roads of the complex.
The owners are responsible for paying their own water and electricity bills as well as rates and taxes.
Single family homes Usually one home per municipal stand. Houses and stands vary in size. The entire property with its improvements, belongs to the owner.
Vacant land –The owner is responsible for the rates and taxes payable to the city council (municipality).
You can decide to buy a vacant stand and have a home built for you. Some contractors offer a complete home building package including a stand, a house design of your own choice and construction as well as all the fees related to the project.
Vacant land within a security estate - Golf course, marina and waterfront security estates are very popular in South Africa.
These estates are registered Article 21-companies (a private company without gain) with their own rules of conduct. The owners are responsible for paying their own rates and taxes as well as the amounts levied by the Home Owners Association of the estate. All owners are to be members of the Home Owners Association.
Possibly related posts: (automatically generated)
Residential Property, Comparing different types
- Banks and Mortgage Finance (Residential Mortgage Loans) continue...
- The Sale of Company-owned or Close Corporation-owned Residential Property
- Combine Properties, Increase Value
- Home / Property Marketing plan seriously Homeowners part 1
- Sectional Title: The Pros and Cons part 1
- Lots of Parking Profit
- Sectional Title Re-sales
- The Sale of Company-owned or Close Corporation-owned Residential Property continue...
- Techniques for Building Value and Protecting Your Real Estate (5-12)
- Exchange control
Topics: Company, Course, Land, Property, Residential, South Africa |
September 29th, 2008 at 3:22 pm
That is that if you are buying a property from a registered VAT vendor (usually when you purchase property in a new development), no transfer duty is payable, as the purchase price includes VAT. … Buying Property
September 29th, 2008 at 3:43 pm
Roundabout Cars, a leading Cape Town Car Hire company offers car rentals throughout South Africa at rates that no one can beat! … Rental Cars