# Personal Finance: Life right or sectional title - what is the best way to buy in a retirement village?

An episode of [Personal Finance with Warren Ingram](https://invisiblenetwork.ai/podcast/1075744322), 6 Oct 2026, 20 min.

Audio: https://traffic.omny.fm/d/clips/5dcefa8e-00a9-4595-8ce1-a4ab0080f142/1ecba37a-6d83-4ee9-a295-a57100b7f2df/1c14b49c-949b-4c09-ba9f-b4db01292c5a/audio.mp3?utm_source=Podcast&in_playlist=8be69053-e7ba-4c54-87a1-a63a00c79838

Stephen Grootes speaks to Warren Ingram, Certified Financial Planner at Galileo Capital, about the key differences between buying a sectional title property and taking a life right in a retirement village. We look at the upfront and monthly costs, ownership and resale rights, maintenance responsibilities and what happens to the property when you die. The Money Show is a podcast hosted by well-known journalist and radio presenter, Stephen Grootes. He explores the latest economic trends, business developments, investment opportunities, and personal finance strategies. Each episode features engaging conversations with top newsmakers, industry experts, financial advisors, entrepreneurs, and politicians, offering you thought-provoking insights to navigate the ever-changing financial landscape. Thank you for listening to a podcast from The Money Show Listen live Primedia+ weekdays from 18:00 and 20:00 (SA Time) to The Money Show with Stephen Grootes broadcast on 702 https://buff.ly/gk3y0Kj and CapeTalk https://buff.ly/NnFM3Nk For more from the show, go to https://buff.ly/7QpH0jY or find all the catch-up podcasts here https://buff.ly/PlhvUVe Subscribe to The Money Show Daily Newsletter and the Weekly Business Wrap here https://buff.ly/v5mfetc The Money Show is brought to you by Absa Follow us on social media 702 on Facebook: https://www.facebook.com/TalkRadio702 702 on TikTok: https://www.tiktok.com/@talkradio702 702 on Instagram: https://www.instagram.com/talkradio702/ 702 on X: https://x.com/CapeTalk 702 on YouTube: https://www.youtube.com/@radio702 CapeTalk on Facebook: https://www.facebook.com/CapeTalk CapeTalk on TikTok: https://www.tiktok.com/@capetalk CapeTalk on Instagram: https://www.instagram.com/ CapeTalk on X: https://x.com/Radio702 CapeTalk on YouTube: https://www.youtube.com/@CapeTalk567 See omnystudio.com/listener for privacy information.

## Transcript

[0:00] Speaker 1: The Money Show.
[0:01] Speaker 2: Personal finance with Warren Ingram.
[0:04] Speaker 1: 22 minutes now to eight the time. Well, talking tonight
[0:07] Speaker 1: about how you manage moving into a retirement home and
[0:11] Speaker 1: particularly about buying a sectional title or taking a life
[0:14] Speaker 1: right in a retirement village as always. Warren Ingram is
[0:17] Speaker 1: a certified financial planner at Galileo Capital. Warren, I wondered
[0:21] Speaker 1: if you were trying to make a certain comment about
[0:22] Speaker 1: me when you first brought this up.
[0:26] Speaker 2: Definitely not, Stephen. Definitely not.
[0:28] Speaker 1: Okay, so for a lot of people, right, you've now retired.
[0:33] Speaker 1: You've been living in your own home for a while.
[0:36] Speaker 1: And one of the biggest financial decisions you're going to
[0:38] Speaker 1: make after you stop working is moving into a retirement village.
[0:41] Speaker 1: And there are two big sort of differences. There's, you know,
[0:45] Speaker 1: buying your home directly through sectional title and a life right.
[0:49] Speaker 1: Let's start with sectional title. If you live in a
[0:51] Speaker 1: complex now while you're working, is that quite similar?
[0:55] Speaker 2: Yeah, so it's exactly the same. It's a little bit,
[0:59] Speaker 2: sectional titles are a little different to just owning a
[1:02] Speaker 2: freestanding home in a normal place within a normal suburb.
[1:06] Speaker 2: So what happens with a sectional title is you own
[1:10] Speaker 2: your house, but the area around your house and, you know,
[1:13] Speaker 2: especially the security aspects and the boundary walls and common
[1:17] Speaker 2: facilities like clubhouses or you know, in a retirement village,
[1:22] Speaker 2: maybe the other facilities, the actual frail care facilities, all
[1:26] Speaker 2: of that is owned by all of the owners of
[1:30] Speaker 2: the whole of the sectional title, including you. But you
[1:34] Speaker 2: are always the owner of your property. So if you own,
[1:38] Speaker 2: you know, flat number 301, then, you know, and you
[1:41] Speaker 2: now own retirement village unit number 301, you are the
[1:45] Speaker 2: owner and it's yours, it's no one else's.
[1:48] Speaker 1: Okay. So, I mean, this also means then what happens
[1:51] Speaker 1: when you sell it or you buy it is actually
[1:54] Speaker 1: really quite important.
[1:56] Speaker 2: Yeah. And it is your business and your assets. So,
[2:01] Speaker 2: let's say you buy the property for a million rand.
[2:05] Speaker 2: You know, if you decide to sell it one day
[2:09] Speaker 2: and move or if you die, then that will be
[2:13] Speaker 2: sold and the proceeds will be paid back. to whoever
[2:16] Speaker 2: you nominated in your will. So very often, parents leave
[2:20] Speaker 2: it to their children. So it is yours. And if
[2:23] Speaker 2: the price has gone up over your lifetime, then that
[2:26] Speaker 2: means that they get an asset that's worth a bit more.
[2:30] Speaker 2: And I guess if the price has gone down, then
[2:34] Speaker 2: your estate's going to lose some money, but still get
[2:38] Speaker 2: the actual sales price.
[2:40] Speaker 1: Okay. And you would still have to involve pay levies
[2:44] Speaker 1: and rates. So what does that do to the monthly
[2:46] Speaker 1: costs then versus a life, right?
[2:49] Speaker 2: So the thing, yeah, this is where the big trick
[2:51] Speaker 2: comes in is, you know, when you look at a
[2:53] Speaker 2: retirement village, especially a sectional title is, you'll pay your
[2:57] Speaker 2: share of the running costs of the whole of the
[3:02] Speaker 2: development and the operation. So your levies will be pretty
[3:07] Speaker 2: high and quite often a little bit higher than actually
[3:09] Speaker 2: what you would pay in a normal apartment block, because
[3:12] Speaker 2: usually there are a few more services that are required.
[3:16] Speaker 2: In addition to that, you're also gonna pay the normal
[3:18] Speaker 2: ownership taxes that we pay to our municipality. So the
[3:23] Speaker 2: municipal rates, et cetera. And then if there is a
[3:28] Speaker 2: big repainting that needs to be done of the whole
[3:32] Speaker 2: place and there wasn't a budget for that and there's
[3:35] Speaker 2: a special levy, then that's in your budget as well.
[3:39] Speaker 2: You now need to cover that cost. So all of
[3:42] Speaker 2: the running costs of the whole place are paid for
[3:46] Speaker 2: by the owners of the sectional title. So generally running
[3:50] Speaker 2: costs for these are quite a bit higher than than
[3:54] Speaker 2: what you would pay in a life right. And you
[3:58] Speaker 2: do get some trade-offs for that, but it's certainly one
[4:01] Speaker 2: of the big downsides of sectional title in a retirement
[4:04] Speaker 2: village is high upfront cost and then certainly much higher
[4:09] Speaker 2: ongoing costs.
[4:11] Speaker 1: You would also be more exposed to inflation over time, right?
[4:14] Speaker 1: Because of those costs.
[4:17] Speaker 2: Yeah, there is no mechanism to help you with a
[4:20] Speaker 2: cost price increase. You know, we all see the cost
[4:24] Speaker 2: of living going up all the time. And so whatever those,
[4:27] Speaker 2: you know, those increases are, it's up to you to
[4:32] Speaker 2: fund them. And, you know, maybe just the other thing
[4:35] Speaker 2: there as well is, you know, because it's a retirement village,
[4:39] Speaker 2: there is significantly more management involved in the retirement village.
[4:42] Speaker 2: And if that retirement village is well run and is popular, then,
[4:47] Speaker 2: you know, that might preserve and actually help with the
[4:49] Speaker 2: price growth of the whole place. But if it's not
[4:52] Speaker 2: well-run or becomes unpopular, we saw this in Joburg where
[4:57] Speaker 2: some areas became really badly run down and so retirement
[5:02] Speaker 2: villages in badly run areas became very unpopular because residents
[5:06] Speaker 2: felt unsafe and maybe couldn't get around as easily as before.
[5:10] Speaker 2: And then you would see the prices really collapse.
[5:15] Speaker 1: Okay, that I understand. What is a life right? How
[5:18] Speaker 1: is that different?
[5:20] Speaker 2: So it's quite a different kind of animal altogether because
[5:25] Speaker 2: you're not buying ownership of a piece of property or
[5:30] Speaker 2: a share in a company or anything like that. You
[5:33] Speaker 2: are buying the right to stay in a particular unit.
[5:37] Speaker 2: for the rest of your lifetime, and if you're married,
[5:39] Speaker 2: then for you and your spouse. So, you're paying for
[5:45] Speaker 2: the right to stay somewhere, but on your death, your
[5:50] Speaker 2: rights are ended. There will very often be a repayment
[5:54] Speaker 2: of some money, and we'll talk about that now, but
[5:57] Speaker 2: you're not selling an asset, and you can't leave that
[6:01] Speaker 2: life right to anybody. When When you die and your
[6:05] Speaker 2: spouse has died, then some money will be paid back
[6:08] Speaker 2: to your estate or to your beneficiaries. But you can't say,
[6:12] Speaker 2: you know, I'd like little Johnny to now move into
[6:14] Speaker 2: my place when I die. There is no right at all.
[6:19] Speaker 2: The ownership is always with the operators of that life right.
[6:23] Speaker 2: So very different. It's not a lease. It's not a
[6:26] Speaker 2: rental agreement. It's not ownership. It's a right to stay
[6:31] Speaker 2: in a place for a time. And equally important, something
[6:35] Speaker 2: that you can't sell on to someone else. And you
[6:37] Speaker 2: also can't go to the bank and say, I'd like
[6:40] Speaker 2: to get a mortgage against this. I'd like to get
[6:42] Speaker 2: a home loan against this. It's a cash deal. You
[6:46] Speaker 2: pay for it. And then some money gets repaid to
[6:50] Speaker 2: you on your death.
[6:51] Speaker 1: Okay. So it's not yours, but you do have a
[6:57] Speaker 1: right to the property until you die. What happens if
[7:00] Speaker 1: there are financial claims on the owner? So you're exposed
[7:02] Speaker 1: in any way to that?
[7:04] Speaker 2: Yeah, this is where some court cases in the last
[7:08] Speaker 2: few years have clarified quite a lot. And I think
[7:11] Speaker 2: a lot of people thought that, you know, they would
[7:13] Speaker 2: be kind of if you've got a life right and
[7:16] Speaker 2: something goes wrong with the operation of the whole retirement
[7:20] Speaker 2: village and there's some financial claims against the operators that
[7:23] Speaker 2: you would still be fine. But that's not 100% true.
[7:27] Speaker 2: So if there is an issue and the operator or
[7:31] Speaker 2: the promoter of the of the retirement village gets into
[7:34] Speaker 2: financial difficulty and there's a bunch of creditors that start
[7:37] Speaker 2: to line up to make claims against the whole place,
[7:42] Speaker 2: then unfortunately you are going to be one of those creditors.
[7:45] Speaker 2: And so there you could suffer real financial consequences where
[7:50] Speaker 2: you don't get back the money that you put in
[7:52] Speaker 2: and you might actually now need to go and find
[7:56] Speaker 2: a new place to live. So the consequences here are
[8:00] Speaker 2: quite severe. if that operator hits the wall or really
[8:05] Speaker 2: does a very bad job.
[8:07] Speaker 1: Your questions for Aaron Ingram tonight on retirement villages, sectional
[8:11] Speaker 1: title versus life rights, 072-702-1702. What happens when the owner
[8:17] Speaker 1: of a life right dies, when they pass away? What
[8:21] Speaker 1: happens to the unit then? Because it wasn't theirs, this
[8:23] Speaker 1: was something else. So what happens then?
[8:26] Speaker 2: So what happens now is you will sign a contract
[8:30] Speaker 2: on day one when you buy in, and that contract
[8:33] Speaker 2: will determine how much money gets paid to your estate
[8:37] Speaker 2: on your death. And so they do kind of take
[8:41] Speaker 2: different forms. So sometimes the operator will say, we will
[8:47] Speaker 2: pay you back your original price plus your you know,
[8:51] Speaker 2: 20 or 50% of any growth and any profit on
[8:55] Speaker 2: that price on your death when it gets sold on
[8:59] Speaker 2: to someone else. In other instances, they'll pay you back
[9:02] Speaker 2: just your capital. So if you put in 4 million rand,
[9:05] Speaker 2: then on your death, and you know, if that's 20
[9:07] Speaker 2: years later, you get 4 million rand back, or the
[9:11] Speaker 2: last option would be you get back a portion of
[9:13] Speaker 2: the money. So You put in 4 million rand, but
[9:16] Speaker 2: you're only going to get 90% of that on your death.
[9:20] Speaker 2: And the reason why those contracts are all a bit
[9:24] Speaker 2: different is because they use that capital, the operators, to
[9:29] Speaker 2: fund some of the running costs of the whole retirement
[9:32] Speaker 2: village themselves. So if you've bought a place for 4
[9:36] Speaker 2: million rand and 20 years later it gets sold for
[9:39] Speaker 2: 8 million rand, some or all of that profit will
[9:42] Speaker 2: be retained in the scheme, and then that gets used
[9:45] Speaker 2: to subsidize the running costs, to make sure the maintenance
[9:48] Speaker 2: is operating well. And so it keeps the day-to-day and
[9:52] Speaker 2: month-to-month costs for the residents much lower than if they
[9:55] Speaker 2: were in a sectional title. And that's maybe the big
[9:58] Speaker 2: kind of key selling for of a life right versus
[10:01] Speaker 2: the sectional title.
[10:03] Speaker 1: Okay. So the monthly costs are then very different.
[10:07] Speaker 2: The monthly costs are very different. You're also not, you know,
[10:11] Speaker 2: you're not paying property taxes because you don't own the place. So,
[10:14] Speaker 2: you know, so your day-to-day, almost your levies are going
[10:17] Speaker 2: to be much lower and then no no running costs.
[10:21] Speaker 2: For example, if the whole building needs to be repainted,
[10:25] Speaker 2: you're not the owner, so that's not a cost that
[10:27] Speaker 2: you have to worry about, that's the operator's cost. And
[10:32] Speaker 2: then equally, the purchase price will very often be quite
[10:36] Speaker 2: a bit less in a life right than in a
[10:38] Speaker 2: sectional title. So you might, for the same place, one
[10:43] Speaker 2: might cost you 4 million Rand for a sectional title,
[10:46] Speaker 2: But for a life right, I'm just thumb sucking, but
[10:48] Speaker 2: let's say it's 2 million Rand. So lower running costs
[10:51] Speaker 2: and lower upfront costs to get in. Okay.
[10:55] Speaker 1: And frail care for either of these, is there any different?
[11:00] Speaker 2: Very, very often, almost always, the frail care will be
[11:04] Speaker 2: kind of a separate agreement. So what you might find
[11:06] Speaker 2: is that if you've got sectional title ownership in a
[11:10] Speaker 2: retirement village or the life right, it gives you the
[11:13] Speaker 2: right to move automatically into frail care. And then, you know,
[11:18] Speaker 2: if it's sectional title, you might then decide to sell
[11:22] Speaker 2: your property while you're now in the frail care. Or
[11:25] Speaker 2: if it's a life right, there might be an agreement
[11:27] Speaker 2: there that if you move into life right, that you
[11:29] Speaker 2: get paid out as per the contract. But in both cases,
[11:34] Speaker 2: usually that you will be responsible for paying for the
[11:37] Speaker 2: frail care. So what happens is you get first in
[11:40] Speaker 2: the queue to get access to frail care. You don't
[11:42] Speaker 2: have to wait or try and find a place, but
[11:45] Speaker 2: no guarantee that your costs will be subsidized or anything
[11:48] Speaker 2: like that.
[11:49] Speaker 1: We speak to Warren Ingram this evening in personal finance
[11:52] Speaker 1: and your questions for him on 072-702-1702. Warren, this one
[11:57] Speaker 1: comes from anonymous and you'll see why. I have a
[12:00] Speaker 1: full-time job. I earn a monthly salary. I've started a
[12:02] Speaker 1: side hustle doing photography at weekends. You must be tired
[12:06] Speaker 1: of wedding marches by now. My income is paid straight
[12:09] Speaker 1: into my bank account, but I've heard I should declare
[12:11] Speaker 1: this income to SARS and pay tax. But it isn't
[12:14] Speaker 1: paid to me through an employer or a payroll. How
[12:17] Speaker 1: will SARS know? Warren will tell you. They know everything
[12:22] Speaker 1: in just a moment. The Money Show. Personal finance with
[12:26] Speaker 1: Warren Ingram. Well, Warren, your question comes from anonymous. I
[12:30] Speaker 1: have a full-time job. I earn a monthly salary. I've
[12:32] Speaker 1: got a side hustle. I do photography. My income is
[12:35] Speaker 1: paid into my bank account. I've heard I should declare
[12:38] Speaker 1: the income and pay tax, but it's not paid to
[12:41] Speaker 1: me through an employer or payroll. How will SARS know? Warren,
[12:45] Speaker 1: do they just know or don't they know at all?
[12:49] Speaker 2: They know. They 100% know, Stephen. I think just to understand,
[12:54] Speaker 2: all of the banks in South Africa are plugged into SARS.
[12:58] Speaker 2: There is proper data sharing between our financial system and
[13:02] Speaker 2: our tax man. So Whether you've got just a bank
[13:07] Speaker 2: account or unit trusts or exchange traded funds or stockbroking
[13:10] Speaker 2: accounts or anything like that, all of that data feeds
[13:13] Speaker 2: back to SARS all the time. And so as they
[13:16] Speaker 2: are aggregating data and starting to use data mining more
[13:20] Speaker 2: and more effectively, and especially now with some of the
[13:22] Speaker 2: AI tools that they've deployed, they are able to kind
[13:25] Speaker 2: of track how we do things. And so if you
[13:28] Speaker 2: think routing money just and not telling SARS is kind
[13:32] Speaker 2: of a good way to avoid tax, unfortunately, you're going
[13:35] Speaker 2: to get yourself into some serious trouble. So I think
[13:39] Speaker 2: if you've just started your side hustle, you're in the
[13:41] Speaker 2: tax year, make sure that you're declaring this income to
[13:45] Speaker 2: SARS and pay the tax that you need to because
[13:48] Speaker 2: SARS has got a very long arm and more importantly,
[13:52] Speaker 2: a very long memory. And they will find you if
[13:54] Speaker 2: not this year, next year or the year after. You
[13:57] Speaker 2: can't go back and say, gee, I didn't know. Ignorance, unfortunately,
[14:01] Speaker 2: isn't any protection against a problem like this.
[14:04] Speaker 1: Okay, so don't do it basically would be your advice.
[14:06] Speaker 1: They will find out eventually.
[14:09] Speaker 2: Don't do it. Pay your tax. If you want to
[14:12] Speaker 2: save tax, what you can do is take some of
[14:14] Speaker 2: the money that you've earned and add it to a
[14:17] Speaker 2: retirement annuity, for example, so that you limit your taxes
[14:20] Speaker 2: and you build up your savings. That would be a
[14:22] Speaker 2: very smart way to legally reduce your tax and build
[14:27] Speaker 2: up your wealth. But don't just avoid tax and think
[14:29] Speaker 2: you're going to get away with it. Lots of crooks
[14:31] Speaker 2: have found that they can't do that.
[14:34] Speaker 1: All right. Very interesting, Warren. Thanks very much indeed.
[14:36] Speaker 2: Okay.
[14:37] Speaker 1: Our main subject tonight is around whether you buy a
[14:39] Speaker 1: life right in a retirement village or sectional title in
[14:42] Speaker 1: a retirement village. You've taken us through the differences between them.
[14:47] Speaker 1: As always, the most interesting part, once you know the facts,
[14:49] Speaker 1: is how you actually go about making the decision. Everyone
[14:51] Speaker 1: will make the decision for themselves in very different ways.
[14:55] Speaker 1: How do you start the process of making that decision?
[15:00] Speaker 2: I think it's about your.
[15:03] Speaker 2: Ability to fund your costs on a monthly basis. So
[15:06] Speaker 2: for someone who's got a very limited budget and, you know,
[15:10] Speaker 2: just doesn't have a lot of income on a monthly
[15:12] Speaker 2: basis at retirement, you might find that a life right
[15:16] Speaker 2: will help to get access to accommodation, you know, often subsidized,
[15:22] Speaker 2: you know, food, for example, where you might get one
[15:25] Speaker 2: or two or three meals a day and then some
[15:28] Speaker 2: sort of care, maybe not frail care, but some care.
[15:31] Speaker 2: And so... using some of your precious capital to buy
[15:35] Speaker 2: into a life right at that point to keep your
[15:37] Speaker 2: running costs down could be a very good decision there.
[15:43] Speaker 2: We have spoken about the risks that if that operator
[15:46] Speaker 2: gets into trouble that you might struggle. So your choice
[15:49] Speaker 2: of where you go and what kind of operator is
[15:52] Speaker 2: very important. You can't just trust some new developer out
[15:56] Speaker 2: there that hasn't got any track record. That could be
[15:58] Speaker 2: a little bit dangerous. For someone else who says, I
[16:02] Speaker 2: can afford higher running costs. And actually, you know, I
[16:05] Speaker 2: wouldn't mind leaving behind a property to my children or
[16:09] Speaker 2: my death. They might go for the sectional title because
[16:13] Speaker 2: they've got a lot more control over their property. They've
[16:15] Speaker 2: got a lot more control over their decisions and what
[16:19] Speaker 2: they do with that property. And, you know, if they
[16:21] Speaker 2: decide in five or 10 years time that they want
[16:24] Speaker 2: to sell and move to another place, they can do
[16:26] Speaker 2: that quite easily as well. And, you know, if there
[16:29] Speaker 2: is very good growth and it's in an area that's popular,
[16:32] Speaker 2: the beneficiaries of their estate might thank them a lot
[16:36] Speaker 2: for some very significant capital growth. But the downside will
[16:40] Speaker 2: be the running costs will be significantly more than the
[16:44] Speaker 2: life right. Okay.
[16:45] Speaker 1: If you're going to buy a life right, are there
[16:47] Speaker 1: certain things you should check before you sort of sign
[16:49] Speaker 1: on the dotted line? Are there certain things you should
[16:51] Speaker 1: look for?
[16:52] Speaker 2: Yeah, you're entitled and it should be absolutely something that
[16:58] Speaker 2: you do is to ask for the financials of the
[17:01] Speaker 2: operator of that life, right? And then to get an
[17:05] Speaker 2: idea of their history. You know, have they been doing
[17:07] Speaker 2: this for a long time? You know, have they got
[17:09] Speaker 2: financial capacity and stability? What happens when, you know, with
[17:14] Speaker 2: maintenance of the property? You know, certainly ask, you know,
[17:18] Speaker 2: to speak to some of the residents who've been there
[17:20] Speaker 2: for some time. for example, to tell you that, you know,
[17:24] Speaker 2: do the levies that you pay, how are they going up?
[17:26] Speaker 2: You know, do they go up a lot every year
[17:29] Speaker 2: or are they under control? And how is the operation going?
[17:32] Speaker 2: And so some operators, you know, are 10, 20, 30
[17:37] Speaker 2: years old and very well funded and very well run.
[17:40] Speaker 2: And so your chances of a nasty surprise are less.
[17:44] Speaker 2: And certainly when you are going to sign a contract,
[17:46] Speaker 2: which you're obliged to do with any of these, you know,
[17:49] Speaker 2: take it to an experienced lawyer, you know, especially lawyers
[17:53] Speaker 2: that have done this kind of work around life rights before,
[17:57] Speaker 2: pay them a fee and get them to look at
[17:59] Speaker 2: that contract and tell you whether, you know, the contract
[18:02] Speaker 2: is okay or is it too one-sided. You know, a
[18:05] Speaker 2: little bit of money that you spend on those fees
[18:06] Speaker 2: now might save you hundreds of thousands in the future and,
[18:10] Speaker 2: you know, limit any kind of nasty surprises. Yeah.
[18:15] Speaker 1: Could you, I mean, and the levy, I mean, the
[18:16] Speaker 1: increases are sort of a big risk. Can you manage
[18:19] Speaker 1: that in any way?
[18:21] Speaker 2: It's very hard for you to manage that. I think
[18:24] Speaker 2: it's more around understanding what those increases have been like
[18:28] Speaker 2: over the last few years. So asking for, you know,
[18:31] Speaker 2: the financials to see how they've increased the levies for
[18:35] Speaker 2: the existing people that have been in there for time
[18:37] Speaker 2: will give you an idea of how they manage that
[18:39] Speaker 2: cost base. You know, if If the cost base is
[18:41] Speaker 2: tracking CPI or inflation, then you're reasonably certain that they're
[18:46] Speaker 2: running a good operation. But if they're doing it at
[18:49] Speaker 2: two or three times the rate of inflation, that tells
[18:52] Speaker 2: you that they probably don't have their costs under control
[18:55] Speaker 2: and you might be facing huge levies in five or
[18:58] Speaker 2: ten years' time.
[19:01] Speaker 1: Have you seen any trends in what people are actually buying?
[19:03] Speaker 1: Do people make different decisions at different times? I mean,
[19:06] Speaker 1: some people will track property markets quite carefully.
[19:09] Speaker 2: Yeah, and also in geography. So, you know, retirement villages,
[19:14] Speaker 2: certainly a very rapidly growing industry as we get an
[19:19] Speaker 2: aging population all around the world and South Africa is
[19:21] Speaker 2: no different. And certainly there's been a migration from retirement
[19:26] Speaker 2: properties in the center part of the country down to
[19:29] Speaker 2: the coast. And certainly some big developers have gone into
[19:33] Speaker 2: retirement villages. But there are also some very old operators
[19:37] Speaker 2: that have done well with things like life rights. And
[19:41] Speaker 2: some of them have a charity backing where they don't
[19:44] Speaker 2: try and operate maximum profits all the time. And those
[19:47] Speaker 2: have been good for people who are stretched at retirement.
[19:50] Speaker 2: and struggling. So you do find the high income people
[19:53] Speaker 2: going into sectional title more so than into life rights.
[19:56] Speaker 2: But it's growing everywhere, Stephen. I think this is one
[20:00] Speaker 2: of those industries that we're going to talk about a lot.
[20:03] Speaker 1: Warren Ingram, thank you. Certified financial planner at Galileo Capital.

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