A recent article from IOL demonstrates why Sectional Title Trustees need our products to enable them to fulfil their statutory obligations.
A recent court case has reinforced the fact that the body corporate of a sectional-title scheme is responsible for the maintenance and upkeep of the common property and may be liable for damages if its negligence in this regard results in personal loss or injury.
This means that, if you are an owner of a sectional-title property, you are partly responsible, as a default member of your body corporate, to ensure the scheme as a whole is well maintained and, as a safety measure, that it has liability insurance in place. Although the property management function may be outsourced to an agent, the responsibility for maintenance ultimately lies with the body corporate and its board of trustees.
The “common property” comprises areas and structures in the scheme that are commonly used by the residents and that do not fall within any owner’s sectional-title unit. In the case of a townhouse development, it may include a clubhouse, swimming pool, common sports or play areas, roads and an outer boundary wall. In the case of a block of flats, it would include the outer structure of the building, stairwells, corridors and lifts.
The monthly levy paid by owners to the body corporate primarily covers the maintenance of the common property.
Trustees are nominated from owners of properties within the complex. They may be intelligent, honest and reliable, but often they are oblivious to the requirements and responsibilities resting on their shoulders. Legislation, set out in various Acts of parliament, places onerous obligations on trustees. This can lead to them failing to properly plan and administer the complex resulting in expensive remedial work being required. This results in a need to borrow the funds to address the shortcomings.
Body Corporate Funding Solutions fills this gap by facilitating loans to qualifying Body Corporates and Homeowners Associations. A conservative loan to value ratio is applied and the entire complex is secured for repayment of the loan. This has resulted in a zero loss in over 20 years.
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