From the pen of Rodney Hayter

"Dear Rodney, my husband is due to retire this year and we are seriously contemplating purchasing into a retirement village, but are more than a little confused because we have been told there are three different methods of purchasing. Is this correct and if so what are they please?" - Fiona Campbell - Cape Town

Dear Fiona, according to retirement accommodation expert and author Lesley McAlpine of Guide to Retirement Places there are indeed three basic methods of buying a retirement home. These are:

1. Sectional title.

This is a straightforward system with which most people are familiar. Registration of the unit is done through the Deeds Office by a conveyancer and fairly substantial costs are involved, including transfer duty and conveyancing costs.

2. Share Block Scheme.

This provides the owners of shares in a company with the right of occupation of certain portions of a building. The company owns the building and shares are allocated to share blocks. The share block resident therefore owns shares in a company. Minimal costs are involved.

3. Life Rights or Occupation Rights.

These rights give you the right to occupy a particular cottage or apartment for the rest of your life, and fall under the Housing Development for Retired Persons Act. No legal costs are involved.

In all three of the above mentioned schemes it is vital to understand the implications of the documents you will be signing. Ask for the latest balance sheet and other relevant information. If you find this confusing, it is best to seek advice.

Article by: Rodney Hayter - www.rodneyhayter.com