Is sectional title the right choice for you?

First-time homebuyers love sectional title apartments and townhouses for several good reasons, and the percentage of home sales attributable to this type of property has more than doubled in the past few years to around 30%. But it isn't the right choice for everyone. 

The main attractions of sectional title, says Gerhard Kotzé, MD of the RealNet national estate agency group, are higher levels of security, lower maintenance requirements and mostly, greater affordability due to there being no transfer duty payable on units bought directly from a developer.

"This last factor is an especially big draw card for first-time buyers, because it substantially reduces the amount of cash they need to cover transaction costs - which can be a huge barrier to home ownership even when interest rates are as low as they were in 2020 and 2021.

"Living in a sectional title complex of course also means that owners are able to share the costs of top-notch security and that they can outsource time-consuming tasks like cleaning and gardening. In addition, buying a newly-built sectional title home should mean that they won't have to worry about major home maintenance issues for several years."

However, he notes, those buying sectional title homes do need to be aware that there is a trade-off for the additional security and convenience of complex living - which is not only that they will have to pay a monthly levy, but that they will very likely have less privacy and less autonomy when it comes to the use of their homes than those who buy freehold properties.

"For example, if you buy a freehold house there is little to stop you adding on a room if and when you feel like it. In a sectional title apartment, you only own your interior floor space and, to a certain extent, the ceiling and walls. But you share those walls with your fellow-owners and can't just knock them down or move them without permission from the body corporate.

"Similarly, even if you own a free-standing townhouse in a sectional title complex, you will usually have to conform to certain appearance rules for the exterior of your home. These may prevent you from planting a private garden, for example, or from putting up an extra carport, or even from installing security gates or additional outside lights."

Depending on the complex and the trustees, Kotzé says, individual homeowners in sectional title complexes may find it hard to get things done or changed. "Collective decision-making by the body corporate is a fact of life in sectional title, which means that even if you and several others see an urgent need for additional security measures, perhaps, or better parking management, your proposal will have to go through the proper process to be approved.

"And while there are some things that the trustees can decide on fairly quickly, others can only be decided on at a meeting of all the owners, which can take a considerable time to organise."

It is also worth mentioning, he says, that sectional title trustees are usually volunteers who are generously giving up their time to run the complex but may not have much experience in building management or legal or financial expertise. "And unless they agree to appoint a professional managing agent to assist them, this can easily lead to conflicts over the way levies are calculated, administered and spent and whether the development is being maintained in a way that will protect the value of each owners' home."

In short, prospective buyers considering a sectional title purchase must be sure, Kotzé says, that they can deal with living and sharing ownership of their complex with other owners - some of whom may not be as friendly, considerate or co-operative as they would wish - and that they are prepared to abide by the decisions and rules made by their body corporate, even if they don't always agree with them.

"That is a reality of sectional title, and while it provides a wonderful gateway to home ownership for a great many people, it doesn't suit everyone. Some people want much more privacy in their home environment, while others really look forward, after being tenants for many years, to being able to make their own decisions about the appearance of their home and garden. Freehold homes are thus the better option for these buyers."