Estate Living Showing Continues Uptrend
Category Property News
Security and lifestyle boost estate versus freehold living despite the premium price
Looking at why buyers would choose a freehold home in an estate compared to a freehold outside of an estate, deeds office trends show a clear shift despite the higher average house prices of estates.
While freehold estates comprise just over 6% of all freehold housing stock, they accounted for 20% of all units and 32% of the total value transacted for freehold property in the 2021-year. This is notably up on 2020 (18% units and 4.52% value) and slightly better compared to 2019 (17% units and 31% value).
There are some important differences between estate and freehold living.
What is a freehold property?
Freehold property means you have outright ownership of the property and land on which it is built. You can basically do as you please on your property, provided you comply with the law and bylaws.
Freehold property can also be in a housing estate in which case it will additionally be subject to the rules and guidelines of the particular estate.
What is a housing estate?
This is a grouping of homes, usually fully enclosed with 24-hour security being the main feature. Increasingly, these estates are offering added lifestyle features such as open spaces with hiking and cycling trails, dams and play parks, golf, tennis and squash, a clubhouse, and other recreational features.
Housing estates are governed by the CSOS Act (Community Schemes Ombud Service Act). There is usually a Homeowners Association, which is a body of owners who looks after the day-to-day management, compliance and legal matters, insurance, and finances, often with the assistance of estate managers.
Important differences between estate and freehold living.
Homes in an estate usually cost more compared to freehold in the neighborhood as you are paying for the added security and amenities.
Aside from monthly utilities, there is usually a levy that would include the cost of security and maintaining the estate.
In freehold (not in an estate) you would be responsible for the security, maintenance, and insurance of the entire property. In an estate, your responsibility would pertain only to your own home while the communal property would be secured, maintained, and insured by the estate as a collective, depending on the particular estate.
In an estate you are part of a community, hence the use of the communal property, receiving of visitors and your general conduct usually need to comply with the estate rules and regulations. In freehold, you are generally free to enjoy your property and receive guests as you wish, provided you comply with bylaws and do not interfere with neighbors' rights to enjoy their property.
Keeping the aesthetic and integrity of the estate intact is hugely positive for property values, hence there are usually restrictions in place. In a freehold, you can paint and renovate as you like, but have little control over aspects that might impact property values such as poorly kept neighboring houses or the neighborhood in general.
Another big benefit of estate living may include open spaces, play areas for children along, and recreational amenities such as a gym, tennis and squash courts, or a golf course. Freehold homeowners (outside an estate), however, would need to make use of public spaces (which might not always be safe). For recreation, you would need to join a fitness center or golf club, all of which would require additional costs and travel. - SA Property insider
Author: Carlo Viljoen