Sectional Title Units and Body Corporate Rules

Here is what you need to know about buying into a Sectional Title Scheme and what to expect from Body Corporate Rules.

Back Off My Boundary! | Property Blog Articles

Ownership within a Sectional Title Scheme

A Sectional Title Scheme describes the ownership of units or sections within a complex. When you buy into a sectional title scheme, you are actually buying a section together with an undivided share of the common property and possibly an exclusive use of some of the common property. These sections are known as units, and a common example is a townhouse within a complex.

An owner of a unit is also an owner of the undivided share of the common area, which is shared by all owners of the same scheme. Common areas may include the parking area or recreational facilities. However, there are also exclusive use areas which form part of the common property but which are allocated to specific owners within the scheme for their exclusive use. A common exclusive use area might be a parking space, a private garden or a storage space.

The components of a sectional title therefore include the unit itself and all common property, as well as exclusive use areas.

Why buy into a Sectional Title Scheme

Buying into a sectional title scheme comes with its advantage. For instance, the cost of living in a sectional title scheme might be lower as the cost of maintaining the common property is shared by all the owners.

Sectional title units offer lucrative rental opportunities as they are often a popular type of property for tenants and are therefore typically easy to lease out.

In addition, the different units in the scheme are normally within close proximity to one another, creating a greater sense of communal life and allowing for greater interaction within communities. This also offers a greater sense of security which many property buyers are attracted to.

The Role of the Body Corporate

An owner of a unit in a sectional title scheme automatically becomes a member of that scheme’s body corporate.

A body corporate is a legal entity made up of all owners in the sectional title scheme. It exists to represent owners and to manage and control the buildings or complex by making sure its financial, administrative and physical needs are taken care of.

The body corporate is also responsible for appointing trustees who are usually tasked with explaining the scheme’s audited financial statements and giving feedback or reports on the work that the body corporate has been doing. Each trustee has a fiduciary duty towards the body corporate.

Body Corporate Rules

Like any other entity, the body corporate is subjected and regulated by a set of rules. These are Management Rules and they describe the powers and responsibilities of the trustees and deal with ways that the trustees manage the body corporate. The Management Rules are contained in Annexure 8 of the Sectional Titles Act. They are prescribed for all body corporates and they can only be changed by a unanimous decision by the body corporate.

No amended or new management rule may contradict any provision of the Act or be unreasonable, and all rules must apply equally to owners of sections put to the same use.

All owners are also subject to the Conduct Rules, which regulate the behavior of owners and tenants living in the scheme. The Conduct Rules ensure that the residents within the scheme do not use their units or the common area in a way that will negatively affect others in the scheme. The trustees as representatives of the body corporate have a duty to enforce the Conduct Rules.

These rules are contained in Annexure 9 of the Sectional Titles Act. They can be applied as provided for by the Act or members may vary them in a general meeting through a special resolution of at least 75% votes from all participating members of the body corporate. Conduct Rules may include but are not limited to the use of the common area or activities on the common property and the supervision of children or pets.

Follow Snymans on Facebook for more legal information, tips and news about property.

1825

Recommended for you

Sectional Title Governance

Upkeep and repairs in sectional title schemes

5175

You just took transfer and became the proud owner of a unit in a sectional title scheme. After the first summer rains you notice, with dismay, that there are damp stains on the outer walls of your unit. You inform the body corporate, who, by way of their trustees, indicate that the said damp must be fixed by you as the owner of the unit.

Read More
Sectional Title Governance

Fining a member in a sectional title scheme

10974

Sectional title schemes rely heavily on its members to ensure the effective functioning and operation of the scheme. While often not the first port of call, should other avenues have already been explored, there are situations in which a member of the sectional title scheme may be fined for contravening management or conduct rules.

Read More
Property Transfers | Bond Registrations | Snymans Attorneys
Sectional Title Governance

Homeowners Associations (HOA) and Body Corporates – same, same but different

12460

For a number of reasons, popularity of sectional title schemes and homeowners associations have risen over the last couple of years, including better security options, affordability and unique living spaces. Understanding the differences between these two bodies is a must for any prospective home buyer in modern day communal living.

Read More
Property Transfers | Bond Registrations | Snymans Attorneys
Sectional Title Governance

Selling a sectional title unit

13446

Sectional title units have grown in popularity over the last number of years because of the increased security and affordability that these units offer. This is particularly true for first-time buyers or young couples starting out.

Read More
Property Blog Articles | Advice | Contractual Matters | Market News
Sectional Title Governance

Your sectional title unit and Airbnb

14257

Many people who own a second property are owners of a unit in a sectional title scheme for investment purposes. These units have largely been let to tenants for rental income, but more recently, Airbnb has changed the landscape of property rentals and how owners are able to derive an income from their investment properties.

Read More

Need more Snymans content?

Sign up for our monthly newsletter.

Sectional Title Units and Body Corporate Rules

Here is what you need to know about buying into a Sectional Title Scheme and what to expect from Body Corporate Rules.

Back Off My Boundary! | Property Blog Articles

Ownership within a Sectional Title Scheme

A Sectional Title Scheme describes the ownership of units or sections within a complex. When you buy into a sectional title scheme, you are actually buying a section together with an undivided share of the common property and possibly an exclusive use of some of the common property. These sections are known as units, and a common example is a townhouse within a complex.

An owner of a unit is also an owner of the undivided share of the common area, which is shared by all owners of the same scheme. Common areas may include the parking area or recreational facilities. However, there are also exclusive use areas which form part of the common property but which are allocated to specific owners within the scheme for their exclusive use. A common exclusive use area might be a parking space, a private garden or a storage space.

The components of a sectional title therefore include the unit itself and all common property, as well as exclusive use areas.

Why buy into a Sectional Title Scheme

Buying into a sectional title scheme comes with its advantage. For instance, the cost of living in a sectional title scheme might be lower as the cost of maintaining the common property is shared by all the owners.

Sectional title units offer lucrative rental opportunities as they are often a popular type of property for tenants and are therefore typically easy to lease out.

In addition, the different units in the scheme are normally within close proximity to one another, creating a greater sense of communal life and allowing for greater interaction within communities. This also offers a greater sense of security which many property buyers are attracted to.

The Role of the Body Corporate

An owner of a unit in a sectional title scheme automatically becomes a member of that scheme’s body corporate.

A body corporate is a legal entity made up of all owners in the sectional title scheme. It exists to represent owners and to manage and control the buildings or complex by making sure its financial, administrative and physical needs are taken care of.

The body corporate is also responsible for appointing trustees who are usually tasked with explaining the scheme’s audited financial statements and giving feedback or reports on the work that the body corporate has been doing. Each trustee has a fiduciary duty towards the body corporate.

Body Corporate Rules

Like any other entity, the body corporate is subjected and regulated by a set of rules. These are Management Rules and they describe the powers and responsibilities of the trustees and deal with ways that the trustees manage the body corporate. The Management Rules are contained in Annexure 8 of the Sectional Titles Act. They are prescribed for all body corporates and they can only be changed by a unanimous decision by the body corporate.

No amended or new management rule may contradict any provision of the Act or be unreasonable, and all rules must apply equally to owners of sections put to the same use.

All owners are also subject to the Conduct Rules, which regulate the behavior of owners and tenants living in the scheme. The Conduct Rules ensure that the residents within the scheme do not use their units or the common area in a way that will negatively affect others in the scheme. The trustees as representatives of the body corporate have a duty to enforce the Conduct Rules.

These rules are contained in Annexure 9 of the Sectional Titles Act. They can be applied as provided for by the Act or members may vary them in a general meeting through a special resolution of at least 75% votes from all participating members of the body corporate. Conduct Rules may include but are not limited to the use of the common area or activities on the common property and the supervision of children or pets.

Follow Snymans on Facebook for more legal information, tips and news about property.

1825