Top take-outs when taking on townhouse living

Townhouse living is a growing trend, especially for next-gen buyers who want the freedom, community and security that this lifestyle delivers. Here's how to take that townhouse dream to the next level.

Buying a sectional title townhouse is a great way for first-time buyers to get a foothold in an upmarket area where the price of freehold homes is beyond their budget. However, before you get too excited, you need to factor in the hidden costs of buying into a community housing scheme.

First up, you need to remember that you won't just be taking ownership of your nifty new townhouse — you'll also have to share ownership of all the 'common' areas in the complex. Think hallways, lifts, gardens and recreational spaces — and you'll have to share the financial responsibility for their upkeep and maintenance.

You'll have to pay a levy each month, on top of your bond repayment, and you need to be sure that you've made room for this in your budget, especially if you intend to apply for a home loan. The banks are not likely to approve your application if they don't think you can comfortably afford both payments.

You should also ask hard questions before you buy about the levy amount and what it covers. For instance, many complexes don't have separate water meters for each unit, so the municipal charges for water use could be included in your levy.

Make sure your levy includes your share of:

• The municipal rates for a common property
• The monthly premium for the bricks-and-mortar insurance that covers the whole property, including your unit
• The security costs
• The maintenance and upkeep of the grounds and building exteriors
• The compulsory reserve fund for the complex

Next, look out for a complex that has a high percentage of owner-occupied homes. Owners tend to insist on a higher standard of maintenance and are less likely to default on their levies if they actually live in the complex. There's a greater chance that the complex will be kept in great shape, plus, the value of your investment will be better protected — it'll be easier for you to resell your property at a profit. And, on top of that, you're less likely to have to deal with noise, pet and parking problems.

Thirdly, check out the management rules that apply to the sectional title scheme before you commit to buying. Living in a community development means that you don't have unrestricted ownership privileges, and the rules of the complex may prohibit pets, or may include restrictions when it comes to renting, renovating or reselling your townhouse.

And lastly, you need to consider what size home to buy and what size complex to buy into. If you can afford it, a two-bedroom townhouse is generally a better choice than a one-bedroom, because it will be easier to resell when you're ready to move on.

As to the size of the complex, be realistic about how involved you want to be in running it. A bigger complex might feel a bit impersonal, but there'll be more candidates available to serve as trustees — and more money to pay a professional managing agent. A smaller complex will probably require more direct involvement on your part.

So, take note of all the positives and pitfalls of townhouse living before you take out that home loan!