Charges For Exclusive Use Areas In Sectional Title Schemes
Of the issues that often cause problems in sectional title schemes, the right to the exclusive use of a common area in the scheme and the rental charged for that use is often brought up. Many feel that they have the right to use a certain area but often are not happy to pay the extra cost or the cost of the maintenance of this area.
Michael Bauer, general manager of the property management company IHFM says that it makes sense to charge for the use of the area, as this area is reserved for the exclusive use for an owner and needs to be maintained in some way. If that owner owned the extra portion, he would be paying a higher levy anyway because his participation quota factor would be higher and he would be responsible for its maintenance.
If it is a garden, for instance, the costs of the upkeep of that garden, e.g. replanting of plants, composting, weed removal, etc., would need to be paid for. If it is a parking area and the road surface needs redoing or if a balcony is leaking and needs to be repaired, the costs of the maintenance need to be borne by someone. The Sectional Titles Act (which came into use in 1986) is clear that the owner of the exclusive use area is responsible for the maintenance and repair of this area.
The Act says that an additional levy for exclusive use areas must be charged, but usually in sectional title schemes the ordinary and special levies are based on a participation quota and should already be covering all the running costs of the scheme.
“There might be an over-recovery of money from the collection of additional levies from the owners,” said Bauer. “This surplus money collected for the exclusive use areas should then be allocated to reducing the scheme’s levies by a certain amount?”
Problems usually arise when a repair is needed in and is not being done timeously, for example, a leaky enclosed balcony. This, said Bauer, is often a tricky situation as the body corporate can compel the owner to pay for the maintenance or repair of an exclusive use area. If the owner does not comply, the body corporate can give him 30 days’ notice and if he doesn’t act they can then arrange for the job to be done at the owner’s expense, according to Prescribed Management Rule 70.
The other problem that the body corporate might encounter is access to the exclusive use area. If it is a balcony for example, the owner will have to give workmen and the managing agent access via his apartment.
“It is recommended that the additional levy for the exclusive use of an area be standardised within the scheme. Exclusive use levies can range from R75 to R250 per month?
“Trustees must budget correctly and only raise levies according to the actual expenses of the scheme. If there is an over-recovery, the regular monthly levies should be reduced by the proportionate amount,” said Bauer.
This article ” Charges For Exclusive Use Areas In Sectional Title Schemes” was issued by IHFM.