The right way to extend a sectional title

Thinking of closing that patio or adding that extra room onto your townhouse, apartment or duet?

Not doing it properly from the beginning could cause you headaches down the line.

In today’s times, many people live in townhouse complexes, duets or subdivided properties which are governed by the Sectional Titles Act, 95 of 1986. Whether it is for economy, increased security, a better sense of community or just to downscale your garden size, a sectional title property has many benefits. Unfortunately, ease of extending or building-on is not one of them.

There are a few differences between full-title (or freehold properties) and sectional title properties which come into play when extensions or additions are to be made to the buildings thereon.

With a full-full title property, one merely has to have the building plans for the proposed addition or extension drawn up and then approved by the regulating authority, being a municipality for example (which is not without its own challenges, as anyone who has done it can attest to). Once the plans are approved, a reputable builder can then make the extension a reality without further ado.

A sectional title property, on the other hand, requires a multitude of further steps. The reason therefore is that any extension or addition that increases the boundaries or floor area of your unit, in turn, decreases the other members’ share of the common property to which they hold a title.

Essentially, an extension of this nature would affect the rights of the other members in that their extent of what they own would decrease by the decrease in the common property. In reality, however, most owners would not be openly affected as the extension would normally be done on an area over which the owner of the unit-to-be-extended has relatively exclusive use (ie. a patio, enclosed garden, balcony, etc), but not necessarily always an exclusive use area (EUA).

  1. The first step to be taken is to obtain the consent of the body corporate for the proposed extension. This is by a special resolution being taken by the body corporate in one of the following two ways:
  • by obtaining the written consent of at least 75 percent of the owners in a round-robin approach to each individual owner; or
  • by calling a meeting with thirty days’ notice to the owners and obtaining a three-fourths majority consent of the owners or proxies present at the meeting.

The majority vote is reckoned both in number and in value of the votes cast.

In the case of a duet, consent is thus only required from the other owner as the remaining member of the body corporate.

The special resolution should state clearly that the owner may take the remainder of the steps below.

  1. Secondly, the proposed building plans are to be approved by the regulating authority (municipality, town counsel etc) as in the case of a full-title property.
  2. Thirdly, the extension is to be built, again, as with a full-title property.
  3. Fourth, a land surveyor (or a specially qualified architect) is to be appointed to draft the revised sectional title plans, showing the addition and its effect on the common property or EUA.

If the addition is built over- or onto an EUA created by the rules of the body corporate (usually a reserved parking spot or an enclosed garden), no problem is posed by the EUA. If the addition is built over- or onto an EUA specified in the sectional title plan, the EUA must first be removed by cancelling the notarial deed between the body corporate and the owner who holds the right to the EUA. If the EUA is not wholly used, the land surveyor will demarcate a new smaller EUA on the revised plans and a new notarial deed will need to be ceded by the body corporate to the owner.

The land surveyor will also draft a new schedule of participation quotas for the units stating the percentage with which the extension has changed them.

  1. Lastly, a conveyancer is to be appointed to bring an application to the Deeds Office for the extension to be incorporated into the sectional title scheme.

To do this, the conveyancer will require the new sectional title plans showing the extension, the schedule of the amended participation quotas, as well as a certificate from the land surveyor that the participation quotas have- or have not changed by more than 10 percent.

If the participation quotas have changed by less than 10 percent, the conveyancer only needs consent from the mortgagee of the extended section (most often a financial institution) if it is bonded.

If the quotas have changed by more than 10 percent the conveyancer needs to give mortgagees of each and every bonded section in the sectional title scheme notice by registered post. The notice must state the details of the bond held, the mortgagor, the extension, and the impact the extension will hold for the security held by the mortgagee.

If the mortgagee(s) consent(s) or do(es) not object within thirty days, the conveyancer may lodge a certificate of the consent with the application to the deeds office.

  1. Finally, the conveyancer must lodge a rates clearance certificate and (as the extension entails the acquisition of more land by extending the section) a transfer duty receipt, usually for a nominal amount.

The Deeds Office will then inspect the application, the new sectional title plans and supporting documentation and update the scheme and the title deed of the extended section accordingly.

Okay, as you can see, it is quite a process to extend a sectional title property. Why not just close off that patio or balcony and be done with it? Your neighbour doesn’t have a problem, and it looks neat and adds value to your home, right?

Unfortunately, these steps have to be followed. Most importantly when it comes to selling your property one day.

If you have extended or built-on, and such extension has the effect of changing the boundaries or floor area of your section, it may be difficult or impossible to sell the property without first taking these steps. Or worse, you manage to sell and the buyer’s loan application is stalled during the transfer process because the structures, the building plans and the sectional title plans do not match.

Most, if not all, agreements for the sale of immovable property also contain a clause whereby the seller warrants that the plans (both building and sectional title) are up to date and registered, and that any improvements to the property (buildings) are approved.

Accepting an offer to purchase bearing such a clause with unapproved and / or unregistered plans (especially the sectional title plans) could lead to breach of contract on your part, together with time-consuming and costly reparations to be made.

By
Dylan Lowe
dylanl@dyason.co.za