Residential property ownership: Your guide to a perfect home

When it comes to buying a home in South Africa, there’s more to consider than just location and square metres, according to Just Property.

The type of ownership you choose has implications for your budget, responsibilities and overall experience.

Here’s the lowdown on the most common property ownership options, plus some insights from property experts to help you figure out what’s right for you.

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Freehold homes: The classic choice

What it is: Freehold ownership is when you own both the land and the dwelling itself. This means you have complete control over the property, including any renovations or extensions (sometimes subject to neighbours’ approval).

Pros: Maximum freedom and flexibility, potential for greater long-term appreciation as land values rise.

Who doesn’t dream of having their own garden, personalising the social areas, and adding a braai pit? Plus, historically, freehold properties tend to increase in value over the long run.

Cons: Higher maintenance costs, as all upkeep is your responsibility. You’ll also bear the full brunt of rates and taxes. If you buy property in a gated estate, what you are allowed to do may be governed by the rules of the body corporates.

Best for: Families or those needing space to spread out and anyone good with a toolbox (or knows a good handyperson).

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Noziqhamo Moss of Just Property Port Elizabeth shares, “Freehold properties offer a true sense of independence. If you value privacy and the ability to customise your living spaces, freehold may be the ideal choice.”

Sectional title units: Owning within a community

What it is: With sectional title ownership, you own a specific unit (like an apartment or townhouse) within a larger complex. You also have shared ownership of common areas like gardens, pools, and security systems. Sectional title developments are governed by a body corporate made up of owners.

Pros: Lower maintenance costs, as they’re split between owners, and everyone contributes via monthly levies.

Built-in amenities are a bonus, and having other owners nearby in a gated community or block usually offers better security than living in a freehold property. Plus, the barrier to entry is lower as sectional title units can be less expensive than freehold.

Cons: There is less privacy, and body corporates have rules—sometimes lots of them. Don’t expect to paint your front door neon green without getting approval—there will be restrictions on renovations you can make.

Plus, monthly levies must be paid in addition to rates and taxes, and everyone is responsible for the debt of the body corporate.

Best for: First-time buyers, downsizers, individuals seeking a more low-maintenance lifestyle and anyone who’d honestly rather hit the pool than mow the lawn.

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On sectional titles, Joe Alves of Just Property Blouberg shares that “Sectional title schemes are an excellent way to enter the property market.

They strike a good balance between affordability and convenience, making them a great choice for many. It’s worth noting that Lightstone data shows that for the first time in two decades, sectional title property prices rose faster than freehold.”

Apartments: City living and more

What it is: Apartments are a subcategory of sectional title, offering a compact living space within a larger building.

They range from tiny studios and micro apartments to multi-bedroom units, often built in high-density areas ideal for a bustling lifestyle.

Pros: Affordability, minimal maintenance, location within urban centres close to work and amenities. Live, work, play! And an apartment can be a smart investment – think rental income down the line when you’re able to move to somewhere bigger.

Cons: Limited space and sometimes even stricter body corporate rules. Can be affected by noise from neighbours. Typically, there is less long-term appreciation compared to freehold.

Best for: Young professionals, buy-to-let investors, and individuals seeking an urban lifestyle without extensive upkeep.

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“Apartments offer access to the exciting pulse of city life without the price tag or responsibilities of a larger property. For many, a flat is an affordable opportunity to get a toe into the property market,” says Chelsea Hendry of Just Property City Bowl in Cape Town.

Buy-to-let and property investing

What it is: Purchasing a property specifically to rent out is a growing investment strategy in South Africa. Any type of property – freehold, sectional title, even leasehold – can be used for buy-to-let purposes.

Pros: Rental income can help with the bond repayments and even give you some extra cash flow. Long-term, it grows your assets and builds your property portfolio. Plus, there might be tax advantages (check with an accountant on that).

Cons: Being a landlord isn’t always sunshine and roses. You need to find reliable tenants, deal with repairs etc.

Fluctuations in the rental market can affect income. Buy-to-let ownership requires careful research and financial planning.

Best for: Those with solid financial footing seeking alternative income and long-term asset growth.

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Rob Pound and Robyn Kersten, from Just Property Heritage, share that: “Property investment can be a smart wealth-building strategy.

When evaluating opportunities, it’s essential to partner with an experienced agent who understands the local rental market.

“Once you’ve bought, a managing agent can take a lot of the schlepp out of being a landlord, like vetting tenants’ credit history, preparing a water-tight lease and seeing to maintenance.”