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Full title and sectional title, what is the differences?

If you are new to the property investment game, I am sure you have heard words like Full Title and Sectional Titles all the time. Here we will give you a quick overview of these two different types of titles and the properties that accompany them.

Full Title

Full title describes the transfer of full ownership rights to the buyer.

  • House This word is used to describe a normal house.
  • Cluster home This is a freehold property, usually in a development of similar houses. The group of houses usually has limited access and good security. Each house is individually owned and there is no levy to be paid, unlike sectional title.
  • Residential property used for business purposes The property will be regarded as residential property for business purposes if 50% or more of the property is used for business activities.
  • Smallholding A property is classified as a smallholding if it is situated in or within a 150km radius of a built-up area, does not exceed 20 hectares, and is able to be connected to a local authority water supply or has a borehole. There must be a home on the property and your main source of income must not be farming on that property. If the smallholding is larger than 8,56 hectares, or if other properties in the area are much larger than 8,56 hectares, you will be charged an interest rate of 1,5% above the qualifying home loan rate.

Sectional title

This describes separate ownership of a unit (section) within a complex.

  • Mini subtype house This is a small, sub-divided portion of a large property which is suitable for cluster housing developments.
  • Semi-detached house This describes two houses that are attached to one another. They may be on separate stands and bonded individually as ordinary houses. They can also be on one stand and bonded together under one bond. The other alternative is that they are sold as separate units in a sectional title development.
  • Townhouse or flat A townhouse or flat unit must be in an approved sectional title complex. The complex must only contain residential units.
  • Duet house
  • This is similar to a semi-detached house, but there are two separate free-standing units on one stand. It could also be two dwelling units attached to one another on one stand. They can be sold under sectional title.

Be sure to get your copy of Build A Legacy for more information.


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