Classy, rustic Philadelphia Village - Building land with architect designed plans for sale. R415000

The Village of Philadelphia- quiet, safe and tastefully rustic. With only about 30 properties in the oudorp, your chances of getting a house here are slim and the prices can be steep.

If you are after real country life but need to be within close proximity to Cape Town (40km), Durbanville (22km), Melkbos (22km) and Table View (30km) then Philadelphia is the perfect mix of unspoilt farm hamlet and easy access to work and urban convenience.

We have 1000 square metres of land in the old part of town and live in the landmark "Klipdakhuis". 400sqm of the original plot plus architect designed house plans are now being released. Currently the land is planted out with a micro olive grove. The new house has been designed with 2 bedrooms, 2 bathrooms, open plan living area and a massive outdoor entertainment zone. Total area of the house is approximately 125sqm. Ownership would be via a close corporation structure. Note that the 3D computer design shows the new house positioned in front of the existing double storey house.

Facts about Philadelphia-

Just off N7 and on Swartland border

Founded in mid- to late 1800's as church and farming town

Restaurants: Pepper Tree: doubles up as art and craft venue (Pottery, gallery, hand made knife workshop, leatherware); De Malle Meul- functions, shows, Sunday buffet, home to lots of Pieter van der Westhuizen art

Wine- great vineyards and 2 good estates: Capaia and Havana Hills

Large police station in village, 24hr Plaaswag available- added safety

Plenty of space for walking and mountain bike riding

Pony and horse riding

Excellent broadband internet (better than Telkom ADSL and iBurst) available by local service provider

Telkom, Vodacom and MTN coverage

2 General dealers, and a gem and crystal and gift shop

2km from the Engen Swartland 1 Stop for petrol, 24hr shop and Wimpy and ATM

Good primary school in the heart of the village

Look at the Philadelphia Village Bugle- a blog about the village- philadelphia-village.blogspot.com

How does the purchase and ownership structure work?

Usually a freestanding property is owned outright- the land and the buildings on it are yours and this is noted on a title deed stored at the Deeds Office. A modification of this concept is sectional title ownership- if you purchase a flat with a garage in a block of flats then the portions you own are clearly described on the sectional title plan. There are areas you share with other owners and you all contribute to the upkeep and maintenance of the parts of the scheme not owned specifically by owners/residents of the block: from public gardens and driveways to lifts and the roofing protecting the entire block.

The usual route taken when wanting to sell off a piece of your land is to obtain permission for subdivison. An application is submitted to the municipality, they circulate it through their departments and notify the community and neighbours for their comment. This is can be a lengthy process. Once approval is obtained and the relevant conditions fulfilled then the new plot gets its own erf number and diagram and becomes an independent piece of property that the owner can sell.

It is permissible in most suburbs, including Philadelphia, to construct a "second dwelling" on a plot- building plans have to be submitted and once approved construction may begin. The process is fairly straightforward. Usually the second dwelling is used by the owner of the primary dwelling on the same plot as a granny/teen flat or rented out to generate extra income for the owner. One way of selling off a portion of a property without going through the lengthy subdivision process with its uncertain outcome is to form a close corporation. This entity owns the entire property and members/shareholders own shares within the CC structure.

The most basic scenario would be a piece of vacant land of 1000sqm in a CC structure with 2 members each holding a 50% share corresponding to 500sqm each of land. This simple set up can be extended to our situation where there is one existing building and a planned second building. The crucial point is that all members enjoy real ownership of their own properties through the vehicle of a company structure governed by a founding constitution that caters for all (or most imaginable) eventualities in a joint residential situation.

A logical and legal company constitution will allow maximum freedom and independence for the owner/members and set out up-front guidelines for shared factors. An example would be municipal rates/sewerage/refuse removal: the council would still see one erf and issue one bill which would be split as per the CC guidelines. Electricity and water could be individually metered .

The good and the bad of property in a CC structure?

Cons:

1) Lack of access to conventional loan/financing: unlikely that a bank will give you a bond

2) Insurance/safety measures required to protect property owners'/members' interests

Pros:

1) No waiting period- once plans are approved you can build

2) Subdivision is more expensive (with costs passed on to the buyer); very long-winded and with an uncertain outcome

3) Shared infrastructure- lower building costs, less monthly costs.

4) Your shares (and therefore your property) can be sold

5) Allows ownership of scarce rural, serviced property that would otherwise be inaccessible to the market

6) Possible tax benefits?

7) Lower land/house cost- prices for freestanding erven in Philadelphia are well over R500000. Houses start at R1.25million. It is feasible to purchase and buy for less than R1million.

Ultimately the plan would be to subdivide the property but this would be a mid- to long-term goal dictated by market values and subdivision costs. The CC structure could hold indefinitely until subdivision or even converting to sectional title was realised.