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Real Rights

4 December 2003

The 1997 amendment to Section 25 of the Sectional Titles Act allows a developer to divide and cede a "real right" to many different people, each of whom can obtain title to their fraction and, if they wish, build their own unit. Buyers should understand that buying a part of a "real right" is not the same as having a freehold title. In a sectional title scheme the owners, as the body corporate, are collectively responsible for the common property and the exterior maintenance of every unit, while the owner of a freehold title has sole responsibility for his property.

Two potentially contentious issues can arise. The first is where buyers use different contractors and in some cases there is inferior workmanship. Here the owners of the better quality units might find themselves having to subsidise the maintenance of the inferior units, even if at first blush the units look similar.

The second is the long-term reservation by developers about exercising their real right to build further units in a sectional title scheme. Effectively one could have one body corporate but groups of units built 30 years apart, with each group of owner having different needs and priorities.

Article on Property24

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