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Before looking at what makes these two types of ownership different, it’s important to understand the concept of ownership and property in the context of South African law.
Protected under our Constitution, no one may be arbitrarily deprived of their property. Though, property law is largely regulated and defined by common law principles which were inherited into our legal system.
Property law refers to the right a person has in or over a specific “thing.” When a person acquires ownership of property, they exercise a real right over that object and this right is enforceable against the world. They are entitled to the exclusive use, control, and benefits of their property.
Freehold or full title ownership refers to the holding of full ownership rights in a specific property. This includes the land itself and any building that is on it.
The owner will hold a Title Deed in their name which is registered at the Deeds Registry – this also serves as proof of ownership. The purchaser of this property is responsible for registration, transfer fees and other associated costs, rates, insurance, maintenance of the property and other incurred utility bills.
Sectional title ownership differs in that only a unit in a building or complex is purchased and full ownership rights may be exercised in relation to that unit only.
The Sectional Titles Act 95 of 1986 defines and regulates this scheme of property. Additionally, the purchaser acquires an undivided share in all communal property of the development. Similar costs are involved as in freehold purchases including registration, transfer fees, rates, and utility bills.
However, in the case of sectional title, a body corporate plays an administrative / managerial role and is made up of trustees duly elected by all owners. Trustees ensure rules are complied with and are responsible for the general upkeep of the communal property.
The owner must maintain their own property i.e., their unit. Levies are paid to the body corporate to give effect to their day-to-day duties. Structural alterations or additions on the unit may not be done without the consent of the body corporate, particularly where the exterior appearance of the building is changed.
As a result, sectional title ownership offers less freedom in terms of rules, but more security, convenience and is more cost-effective as the load of maintenance is managed and shared by all owners. Though, both are forms of property ownership and enforceable against anyone.
Do you want to buy a property and aren’t sure if you should buy go for sectional title or freehold?
Contact our law firm in Cape Town for expert legal advice and we’ll help you make the right decision.
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