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Sectional Title Governance

Structural alterations require body corporate approval

It is important for potential owners to understand the benefits and potential drawbacks of buying into a sectional scheme.

The ins and outs of subject to bond approval clauses

Sectional title properties offer owners peace of mind when it comes to security and maintenance, with significant portions of structural maintenance being covered by monthly levy payments and the management of such maintenance being taken care of by the trustees. However, when it comes to freedom of renovation, there are limitations on sectional title owners that those who own of freehold properties do not experience.

For many, a sectional title property remains the sensible choice; it is simply important to understand what the requirements or restrictions may be should an owner wish to undertake any alterations in the future.

While there are many improvements one can make to the internal portion of a sectional title scheme without requiring approval, structural alterations are governed in greater detail. According to the Sectional Titles Act, before contracting or beginning any structural alterations on a sectional title unit, an owner must first acquire the approval of the body corporate. This involves passing a special resolution to allow the alterations which must be agreed upon by 75% of owners present at the relevant trustee’s meeting. Alternatively, this special resolution can be obtained by approaching owners individually and obtaining consent of 75% of owners.

Further to this, there is new legislation set to come into operation in April 2016. This new legislation, the Sectional Titles Management Act and the Ombud Act, will prescribe additional obligations and have even greater reaching effects on developers wanting to register a new scheme or bodies corporate and sectional title owners wanting to make additions or  alterations.

Under this new legislation, new and amended management and conduct rules will also have to be lodged with the Department of Housing rather than the Deeds Office as is currently done. The Department of Housing will issue a certificate to this effect which will then form part of the documents lodged at the Deeds Office.

With new legislation, always comes new questions and possibly complications, but doing research and asking questions of the professionals will ensure that you have all the necessary information. Most importantly, this will enable you to make an informed decision and get the most out of your property whether sectional title or freehold.

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Sectional Title Governance

Structural alterations require body corporate approval

It is important for potential owners to understand the benefits and potential drawbacks of buying into a sectional scheme.

The ins and outs of subject to bond approval clauses

Sectional title properties offer owners peace of mind when it comes to security and maintenance, with significant portions of structural maintenance being covered by monthly levy payments and the management of such maintenance being taken care of by the trustees. However, when it comes to freedom of renovation, there are limitations on sectional title owners that those who own of freehold properties do not experience.

For many, a sectional title property remains the sensible choice; it is simply important to understand what the requirements or restrictions may be should an owner wish to undertake any alterations in the future.

While there are many improvements one can make to the internal portion of a sectional title scheme without requiring approval, structural alterations are governed in greater detail. According to the Sectional Titles Act, before contracting or beginning any structural alterations on a sectional title unit, an owner must first acquire the approval of the body corporate. This involves passing a special resolution to allow the alterations which must be agreed upon by 75% of owners present at the relevant trustee’s meeting. Alternatively, this special resolution can be obtained by approaching owners individually and obtaining consent of 75% of owners.

Further to this, there is new legislation set to come into operation in April 2016. This new legislation, the Sectional Titles Management Act and the Ombud Act, will prescribe additional obligations and have even greater reaching effects on developers wanting to register a new scheme or bodies corporate and sectional title owners wanting to make additions or  alterations.

Under this new legislation, new and amended management and conduct rules will also have to be lodged with the Department of Housing rather than the Deeds Office as is currently done. The Department of Housing will issue a certificate to this effect which will then form part of the documents lodged at the Deeds Office.

With new legislation, always comes new questions and possibly complications, but doing research and asking questions of the professionals will ensure that you have all the necessary information. Most importantly, this will enable you to make an informed decision and get the most out of your property whether sectional title or freehold.