One often finds advice on buying a property, from hidden costs you need to be aware of, how the process works and how to determine whether the property you are interested in will be a good investment. But did you know that sellers need to be aware of the unique factors that go into selling a property that is part of a Sectional Title Scheme?
A property in a Sectional Title Scheme forms part of a larger property with a community of owners, overseen by a Body Corporate, in most instances with the assistance of a Managing Agency and with their own unique set of rules and regulations.
As the seller, it would be a good idea to give the prospective buyers of copy of the Conduct Rules before they sign the offer to purchase. The Conduct Rules will have regulations about whether you’re allowed to have pets, or how many people live in a unit and if the prospective buyer is not aware of this from the start, it may cause issues later on.
Levy Clearance Certificate
In addition to the standard documentation required for a property sale, you will need a levy clearance certificate from the body corporate and the buyer’s bank also needs documentation from them to assess the financial status and management history of the sectional title scheme before they approve a bond. This includes the most recent annual audit report and, if in the case where levies are in arrears, the process on how the levies will be collected. In some instances, the bank may ask for the Conduct Rules as well.
If a seller waits too long to request these documents, the approval process and sale could be delayed.
Certificate of Compliance
A property must be legally fit for sale and before a property can be transferred to a new owner, the transfer attorney must be in possession of a valid Electrical Certificate of Compliance (ECOC). While these usually only take a few days to acquire, if any problems are discovered which require repair it could not only delay the transfer but also seriously dent the pocket at a time when you can least afford it.
Municipal rates clearance certificate
The seller’s conveyancer should also apply for their municipal rates clearance certificate as soon as possible to ensure outstanding amounts will have to be settled before the property can be transferred. These municipal rates cover water, electricity, refuse and property rates.
Building plans and Occupation Certificate
Banks insist that any residential property that is being sold and in need of a bond, cannot be assisted unless the property has up to date building plans which have been approved by the local municipality. To be fully compliant, the seller or the buyer has to be able to show that the building was awarded an Occupation Certificate, confirming that the construction was done in accordance with the approved plans and the regulations pertaining at that time.
Scheme Executive Training
The role of Scheme Executives within a body corporate is an important one, and one that is beneficial to the wellbeing of the scheme. A good board of Scheme Executives will be able to ensure that the scheme yields positive financials whilst at the same time runs effectively and smoothly keeping tenants and owners happy.
As the owner of a Sectional Title Property, you are automatically a Scheme Executive and to perform your functions or duties, it is advised that Scheme Executives invest in training. This training will cover all the information offered above AND MORE!
To make sure that the sale of your property goes smoothly, it is essential that you engage the services of an experienced estate agent that specifically deals with Sectional Title Schemes and whom can offer Scheme Executive Training.