select
|

SOUND ADVICE WHEN BUYING SECTIONAL TITLE HOMES

Currently a wide variety of buyers are looking to sectional title units to meet their accommodation needs, says Carol Reynolds, Pam Golding Properties manager for the Durban area.
 
"Sectional title units appeal to a broad range of home buyers including both owner-occupiers and investors, and at present we see a demand from a mix of first time buyers, pensioners, retirees, young couples and families, single parent families and of course, investors as a buy-to-let investment.  We also find parents standing surety for their children – young people investing jointly in sectional title apartments and professionals pooling their incomes to buy in more than one person's name," says Reynolds.
 
She says buyers are attracted to sectional title complexes for numerous reasons. They offer good security, which is high on the priority list of most home purchasers, while external maintenance is taken care of by the body corporate and pools and gardens kept in good condition all year round.
 
"The sectional title sector of the market presents good buying opportunities right now. Interest rates are low, and from a buy to let perspective the tenant pool has grown – as many would-be purchasers are compelled to rent due to the banks' stricter lending criteria. Sectional title units are very suitable for letting and in fact are usually easier to let than freestanding homes.
 
"From a location point of view, here in Durban we find Glenwood has broad appeal because of its proximity to the university and hospitals, making it ideal for doctors, nurses, students and lecturers. On the Berea and in Morningside, sectional title units are popular among those wanting convenient access to highways and the CBD for easy travel to work, as well as those drawn by the number of good schools in the area. We are also starting to see renewed interest in the CBD from investors. For example, the Royal Hotel has been sectionalised and we are selling off units there with the advantage of excellent returns via the rental pool."
 
Reynolds offers some sound advice for those buying into sectional title schemes: Ask to see the financial report, which should be audited, and check that the body corporate is liquid. The body corporate should also have funds in reserve – if not, this is a concern as there will be no contingency budget for emergencies. Also ascertain if there is any talk of pending special levies – this would be recorded in minutes of meetings – if so, for what purpose. And look at the outstanding levies noted in the financials – at any given time there shouldn't be more than 5-10 percent outstanding; any more than this is a concern. Finally, take note of the general exterior maintenance of the buildings – a good body corporate maintains its block/s well and this is usually a good indication of a healthy bank balance.
 
She says first time buyers who have no experience of a body corporate need to familiarise themselves with the body corporate rules. "It's a good idea to investigate the profile of the other owners, for example, senior citizens may prefer not to move into a block that is predominantly owned by young families with children. It's always important to establish what percentage of the units is owner-occupied and what percentage tenanted. From an investment perspective, always ask your estate agent what rental return you can expect in a block and what the monthly levies are, to see whether the purchase makes financial sense. And in the current lending climate it's critical to ask your agent whether the banks are finding value in the block, and whether they are financing property in the building," adds Reynolds.
 
PGP Durban is currently marketing a range of conveniently located sectional title homes priced from an entry level figure of R250 000 in the CBD, to a range of well priced units on the beachfront starting at R330 000 and ranging into the millions. In Somerset Country Estate in the Glenwood surrounds is a recently listed, appealing two bedroom simplex in excellent condition with a garden and two parking bays priced at R795 000.
 
Issued by Gaye de Villiers


  Comment on this Article

  Please login to post comments

Post to my facebook wall
  
2000
Characters remaining


    Latest Property News
    • 22 Nov 2017
      Most people know of the Community Schemes Ombud Service (CSOS) and that levies must to paid to fund its operations. In this article the experts at Paddocks will address some of the issues that are causing confusion.
    • 22 Nov 2017
      While sales have noticeably slowed in most sectors in most Cape town suburbs, the security estate sector in Constantiaberg has bucked the trend by remaining buoyant, with sales by August this year already surpassing total sales in 2016.
    • 22 Nov 2017
      The end of the year is fast approaching, and so are all the travellers, tourists and holidaymakers. For those who live near or own a property in a holiday-hotspot, the festive season also brings with it an abundance of short-term rental opportunities. Its a great way for property owners to make a few extra rand for their own holidays or to put towards their savings.
    • 21 Nov 2017
      The buying process is over, and the moving truck has delivered your household goods to your new property. Now it’s time to unpack and turn your new house into a home.
    • 21 Nov 2017
      When an offer to purchase a property is signed by both buyer and seller, this constitutes a binding agreement or “Deed of Sale” between the two parties. However, in most cases the “standard contract” might not be enough to cover all the specifics pertaining to the sale. The agreement may require some additions or alterations to clauses, which needs an expert hand in the drafting of such
    • 21 Nov 2017
      As more and more South Africans look to invest in property abroad, Spain is offering them one of the best deals in global real estate.
    • 20 Nov 2017
      Since 2012, sectional title complexes have been leading the South African property market, not only in terms of price growth, but sales volumes as well. Remaining relatively strong, even in the face of 2017’s political and economic turmoil, experts say this market segment could offer valuable insight into South Africans’ property purchase priorities.
    • 20 Nov 2017
      Regardless of whether you are purchasing your first start-up home, downsizing or moving in with roommates, finding ways to maximise small spaces can be a big advantage, says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa.
        
    X
    Subscribe to the MyProperty Newsletter

    Name  
    Last Name  
    Email Address  
    Email Frequency
    select
    X
    Share this Page

       
    For Sale Property
    Rental Property
    More Options
    About
    Connect with us
    FEEDBACK