By Prof Graham Paddock
 
Introduction to Sectional Titles | Part 2
Introduction to Sectional Titles | Part 3 

 

1. What is sectional title?
A title system in which ‘sections’ of buildings are created for separate ownership. A ‘sectional plan’ is registered and available at the Surveyor-General’s Office for each sectional title development. All the parts of the land and the buildings that are not labelled as sections (or parts of sections) on the sectional plan are ‘common property’.The common property is owned jointly by all the people who own sections. The sectional plan for a scheme may also show ‘exclusive use areas’. These are defined parts of the common proper set aside for ‘exclusive use’ by particular owners, for example as a garden area or parking bay. The entire development is referred to as a sectional title ‘scheme’.

2. What is sectional title ownership?
It is ownership registered at a Deeds Registry. The Deeds Registry records ownership of ‘units’ in a scheme. Each unit is a particular section, that could be a flat or a garage, and a share in the common property. The Deeds Registry records also show any registered ‘exclusive use rights’.

3. Is sectional title only for flats and houses?
No, while most sectional title schemes provide permanent accommodation, there are schemes that consist of offices, shops, mini-factories, holiday flats. Any type of land and buildings put to any use can be ‘sectionalised’, so schemes include high-rise buildings, low-rise clustered structures or entirely separate buildings.

4. As a sectional title buyer, what will I own?
You will own one or more units. These will include one or more numbered sections (such as a townhouse and a garage) and shares in the common property. The boundaries of each section are the centre lines of the walls, floors and ceilings that surround it. But the section may also include open balconies, patios and other adjoining spaces. Check the registered sectional plan to see exactly what parts of the land and buildings fall within your section. Each unit, which is the thing that you will buy, sell and bond, includes a particular section and its share in the scheme’s common property. In addition, you may also have ‘exclusive use rights’ to one or more parts of the common property.

5. What is the sectional plan?
The sectional plan is an approved survey document showing the boundaries of all sections in the scheme, any registered exclusive use areas and the details of the participation quotas.

6. What is common property?
The common property in a scheme is those parts of the land and buildings that are not contained within any section according to the registered sectional plan. For example, the common property usually includes all the land, the foundations, roofs, passages, parking bays, lifts, garden areas, swimming pool and any other facilities.

7. What is a participation quota?
A participation quota is the ‘share’ in the common property allocated to each section. The sectional plan includes a ‘Participation Quota Schedule’ that allocates a particular share to each section. Generally, the participation quota for each section is determined by the following calculation:
Floor Area of Section X 100 / Total Floor Areas of all Sections.
So, for example, if a sectional plan shows that the measured floor area of section number 1 is 94 square metres and the total floor areas of all sections is 1853 square metres, the participation quota for section 1 would be calculated as: 94 X 100 / 1853 = 5,0728%.
The participation quota allocated to a section is usually used to calculate an owner’s share of the scheme’s common expenses and the value of each owner’s vote.

8. What is a unit?
A unit is a section plus its allocated share in the common property.

9. What is an exclusive use area?
An exclusive use area is a defined part of the common property set aside for exclusive use by a particular owner. You may buy and become entitled to ‘exclusive use rights’ that allow you the sole rights to use a part of the common property, such as a parking bay, carport or garden area.

10. Are sectional title schemes the same as share block schemes?
No, share block schemes do not give participants registered ownership of property. In share block schemes each shareholder enters into a ‘use agreement’ with the company that allows him or her the exclusive right to use a part of the buildings owned by the company. In a sectional titles scheme, you own your unit, you do not have only a contractual right to use it. A shareholder in a share block scheme cannot bond his or her shares, whereas the owner of a sectional title unit get a home loan from a bank secured by a bond over a unit and any registered exclusive use rights.
 
Introduction to Sectional Titles | Part 2
Introduction to Sectional Titles | Part 3