Share Block Levies vs Sectional Title levies скачать в хорошем качестве

Share Block Levies vs Sectional Title levies

Share Block vs Sectional Title: Levies Explained AI GENERATED Comparing Share Block and Sectional Title ownership in South Africa. In a share block scheme, investors buy shares in a company that owns the entire property; the company (not the individual) holds the title, and shareholders gain exclusive use of a unit. In a sectional title scheme, each owner acquires a registered title deed to their unit plus an undivided share of the common property. Levies (monthly fees) function differently under each model. This video will explain levies (the regular contributions for upkeep) and highlight the key cost differences in these ownership schemes, helping investors, retirees, and homebuyers make informed decisions about South African real estate investments. How Levies Work In a share block company, all owners are shareholders and must contribute to a common levy fund. Each shareholder pays a monthly levy that covers the collective expenses of the building – including maintenance, insurance, municipal rates and taxes, and even any bond repayments on the property. In fact, the Share Blocks Control Act explicitly requires shareholders to pay levies for the upkeep and maintenance of the scheme. Because the company pays the property’s rates and services in one account, individual shareholders typically cannot claim personal municipal rebates on their unit. In contrast, sectional title owners pay levies (now called contributions) to the Body Corporate for shared costs like cleaning, security, lifts and structural maintenance. These contributions are the “life-blood” of the scheme, funding repairs, insurance and reserve funds. Importantly, sectional owners also pay their own municipal rates and taxes on their individual unit, which allows them to benefit from any personal property-rate rebates (for example, rebates for seniors) that are not available to share block owners. Key Differences (Share Block vs Sectional Title) Ownership & Title: In a share block scheme you own shares and a use-agreement, but not the land; in a sectional title scheme you hold a registered title deed to your unit. Levies & Costs: Share block shareholders pay levies into a company fund that covers all building costs (maintenance, rates, insurance, loan interest, etc.). Sectional title owners pay levies (Body Corporate contributions) for common-area upkeep and separately pay their own unit’s rates/taxes. Financing: Banks generally require larger deposits or special loans for share block purchases, since traditional mortgages are rarely available. Sectional title units can be financed with conventional home loans, making purchases easier. Control & Management: Share block complexes are run by a board of directors (shareholders have limited direct input on day-to-day decisions). Sectional schemes are managed by an elected Body Corporate (owners vote on budgets, rules and levies at AGM). Transfer & Resale: Selling a share block unit involves transferring shares (often with board approval) and paying transfer duty on the share sale. Selling a sectional title unit is a straightforward Deeds Office transfer with normal transfer duties. Importantly, in a sectional title scheme each owner’s unit is rated individually, so one owner’s non-payment of levies or rates cannot jeopardize your ownership. Tax/Rebates: Sectional title owners can claim property-rate rebates (e.g. R120,000 off valuation for all owners, plus extra for over-65s) because each unit is rated separately. Share block shareholders do not receive these rebates, since the Company is listed as the taxpayer for the property. Investment & Homebuyer Considerations Understanding these levy and cost differences helps with budgeting and investment planning. Share block schemes may offer lower purchase prices, but your monthly levy payments cover the entire building’s expenses. Sectional title often involves higher upfront costs (bond registration, transfer costs), but owners have more control and access to financing. For investors or retirees, it’s important to consider both the ongoing levy burden and your ability to finance and insure the unit. As experts advise, consulting a property attorney or real estate advisor can help ensure your choice matches your goals and budget. #leviesexplained , #shareblock vs #sectionaltitle , #propertyinvestment , #realestateeducation #southafrica , #ownershipstructure #homebuyingtips