Pros and cons of buying Sectional Title property
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Buying Sectional Title property is a great way to set foot on the property ladder, especially for first-time homebuyers because it can be more affordable to purchase and easier to maintain than a large freestanding house. Sectional Title units are also good choices for property investors who want to build a portfolio and secure their financial future because they appeal to tenants and can generate rental income.
Buying off-plan could be an even more affordable way of acquiring Sectional Title property as it could involve fewer costs. One of the things that make buying off-plan in a residential housing development particularly appealing is that you get a brand-new property that has never been occupied. Developers also have high-quality renders that provide tremendous peace of mind in terms of what you're purchasing, with modern technology able to answer most questions relating to what the finished product will look like.
Pros of buying Sectional Title property
- Easier to finance: Before construction commences, developments have to be approved by the major banks, so when you then apply for a bond, the process is often quicker and easier. Using a bond originator like BetterBond puts you in an even stronger position because we negotiate with the banks on your behalf to get you a better deal. Getting you a lower interest rate on your bond boosts your home loan affordability and delivers huge savings over the term of your loan. Let us help you get started!
- Body Corporate: As owner of a Sectional Title unit, you automatically become a member of the Body Corporate, the legal entity that manages common areas of the property. You pay a monthly levy for a range of services, including conduct rules for residents, buildings insurance, perimeter security, cleaning, landscaping and maintenance of common areas like gardens. Owners' levies also cover water and electricity for common areas.
- Security: Sectional Title property generally offers good entrance and perimeter security. In a freestanding house you are responsible for installing and maintaining these systems, but in a Sectional Title property, the Body Corporate takes care of it and it's funded from your monthly levy.
- Running costs: You pay for municipal rates and taxes, home contents insurance, upkeep of your garden if your unit has such an area, and your own monthly water and electricity consumption. Everything else is pretty much taken care of.
- Rentals and resales: Sectional Title property is popular with renters, which makes it a good option for investors. This also links to resale value, which often improves over time.
- Connectivity: Sectional Title property is usually fibre-enabled, so your only expense would be connecting to the infrastructure that already exists, and monthly usage. Working from home is becoming more prevalent, so this is a big plus.
- Mixed use: The so-called 'live, work, play' lifestyle is a feature of many Sectional Title properties where residential apartments are found in close proximity to shops and workspaces, all within easy - and safe - walking distance. This is a very appealing lifestyle to the environmentally conscious who want to cut down on commuting and desire the flexibility of working from anywhere.
Cons of buying Sectional Title property
- Communal living: Sectional Title property means living close to others and this could come with a few everyday irritations, for example noise. However, these can often be resolved by being considerate and treating people with respect.
- Special levies: From time to time in a Sectional Title property, there might be a special levy, for example if the exterior of the building needs painting. However, owners will always be informed of this well in advance, so you will be able to budget for it in good time, and ultimately it would increase the value of your investment.
You can see why Sectional Title property has remained popular with buyers over time - because it offers great lifestyle and financial choices for everyone from first-time homebuyers and renters, to empty-nesters and investors.
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