Are body corporate financials required when buying a unit?
Financials are only required once a year from the body corporate or managing agent for us to determine the state of affairs of the complex. As the bank has a financial interest in the complex they need to ensure that the funds are well managed.
What sectional title units are not considered?
Commercial or mixed tenancy, that is, shops and flats in the same unit. This however varies depending on the banks policy. Share block schemes, that is, where shares are purchased and not the property itself.
Timeshare, that is, where the right to occupy the property is purchased.
What is exposure of a complex?
Exposure is the number of units bonded to a particular bank as a percentage of the total number of units in the complex. The level of exposure may differ from complex to complex.
Do you own the entire property if you buy under sectional title?
No. In a sectional title deal you own the structure but not the land.
What part of the property do you own if you buy into sectional title?
You will buy a section, plus an undivided share of the common property. Taken together, this property is called your unit.
What part of the building makes up a section?
A section extends to the mid-point of outer or dividing walls, the lower part of the ceiling and upper part of the floor.
What is common property?
The common property is that part of a development which does not form part of any section. Structures and areas in this category include:
Driveway, Garden, Swimming pool, Corridors, Lift, Entrance foyer, Parking bay, Outer walls, Foundations, Roof
Who controls the common property?
Common property is always controlled by the body corporate. Its decisions are legal and binding. What this means is that even though parts of the common property are designated as exclusive use areas, they are nevertheless under the control of the body corporate and are subject to the rules of the scheme.
What is an exclusive use area?
It is an aspect of the property which you do not own, but over which you alone have use. This could be any of the following:
Parking bay, Garden, Patio, Garage, Storeroom
Go through your contract carefully to find out what areas form part of the property you want to purchase. Also, ask your estate agent or lawyer for advice before you commit yourself.
What is the body corporate?
It is the collective name given to the owners of the units in your complex. All registered owners of units are members of the body corporate.
What does the body corporate do?
It controls and runs the scheme. Trustees are appointed by the body corporate to administer the complex on a daily basis. The trustees also make major decisions regarding the complex.
Who are the trustees?
The trustees are usually owners of units who have been entrusted with the task of daily administration of the development. They are appointed by the body corporate at an annual general meeting (AGM ).
Who may not be a trustee?
The managing agent; members of their staff; or an employee of the body corporate
What is a levy?
This is the cost incurred in running a complex which has to be paid to the body corporate.
What do these costs include?
Rates, taxes and other charges, insurance premiums, repairs and maintenance of the common property, wages and salaries of cleaners and other staff, water and electricity used on the common property.
Who pays the levy?
The individual owners pay in the form of a monthly levy, calculated in accordance with the participation quota (size of the unit owned) for their unit.