SHARE BLOCK UNITS AND THE DISADVANTAGES
Many flats and busines premises are still owned by Share block companies. This offers little to no value to an owner of the unit. When you purchase a share block unit you are actually purchasing shares in the company that own the block of units and not the actual unit itself. If the company that owns the units became bankrupt the effect would be the same as if you had purchased shares in a company on the stock exchange that went bankrupt- your shares would be worth nothing.
Another disadvantage of a Share block unit is that it has become very difficult to impossible to obtain finance on the unit. While this may not affect you if you can afford to buy it with cash - it will have an effect on you when you want to sell and can't find a buyer who can get a bond.
Payment of rates or the lack thereof by even one shareholder can affect everybody living in the block of flats. The block as a whole is owned by the Shareblock company and they pay rates as a whole to the relevant Municipality. If one person falters in their payment to the Company this places everyone in jeopardy of having their lights and water cut off and the building can be sold in execution to recover the outstanding debt.
SHARE BLOCKS CAN BE CONVERTED TO SECTIONAL TITLE. For more information CONTACT US