A general look at “Sectional Title” properties and how they fair in comparison to “Freehold” and “Leasehold” properties (Part 3) By Neltah Mosimanegape

17 Feb 2017
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Thinking about purchasing freehold property?

The purchasing of any kind of property requires one to familiarize themselves with the applicable land laws of the country. According to the Land Act of Botswana, “Freehold land is held in perpetuity and the owner is free to sell, lease and mortgage the property to citizens and non-citizens subject to the Land Control Act 32:11. The freehold title is inheritable, freely transferable and registerable and does not lapse with time. State or tribal land is not capable of being freehold land.”

It is advisable that potential buyers seek legal advice when purchasing freehold property or any other kind of property for that matter. Also, in an effort to avoid buying overpriced property, potential buyers should ensure that the property they are interested in is valued by a reputable property valuation company registered with the Real Estate Institute of Botswana (REIB) and the Real Estate Advisory Council (REAC). The valuation requirement is a pre-requisite for buyers applying for a mortgage loan from a financial institution. 

“Sectional title” or “standalone freehold” property?

Sectional title and standalone freehold properties both have conspicuous “pros and cons” for property buyers:

  • Sectional title properties rarely offer the same level of privacy as standalone freehold properties. This may not appeal to potential buyers looking for a property that offers them a higher level of privacy.
  • On the same accord, sectional title properties offer better security than standalone properties.
  • Due to the communal setup of sectional title properties, the levies incurred are shared amongst all occupants. A pre-estimated “levy fee” may be charged or the more accurate “pro-rata” system is adopted. However, a standalone freehold property is solely responsible for the utility costs incurred.
  • Occupiers of section title properties generally have to be more considerate of fellow occupants of the property. The rules and regulations of sectional title properties are usually outlined in the “purchase agreement” between the buyer and the developer. An occupier of a standalone property is at complete liberty to make decisions on his/her own property without consulting others parties.
  • Sectional title properties are governed by the “Body Corporate.” Proposed renovations, improvements and/or changes by sectional title owners are to be routed through the Body Corporate for approval before any work can commence.
  • Purchasing either a sectional title property or a standalone freehold property encompasses a similar process involving the current property owner and legal advisors to ensure the smooth handover of the property from the one party to the other.