People who buy sectional property for the first time often underestimate the importance of the body corporate and the impact the entity can have on their daily lives as well as the value of their property.
However, assessing the body corporate is as crucial as thoroughly inspecting the property itself because the body corporate plays a important role in maintaining the complex, enforcing rules, and managing the communal finances.
If it is inefficient or mismanaged, you could face various issues such as deteriorating facilities, unexpected special levies or poor security, which can have a direct impact on the value of your property and your quality of life.
Cobus Odendaal, CEO of Lew Geffen Sotheby’s International Realty in Johannesburg and Randburg explains the body corporate’s crucial role and how it affects property owners:
Shared responsibilities
According to Odendaal, in a sectional title property, individual owners own their units, but the common areas are managed by the body corporate including gardens, walkways, parking areas, and pools.
The body corporate is also responsible for the maintenance of the exterior of buildings, including painting and structural repairs. Homeowners need to keep in mind that poor maintenance can not only affect their quality of life but also the resale value of their property.
Financial health of the scheme
Financial stability is one of the most vital factors of the body corporate. If the finances are poorly managed and there is insufficient reserves, you may be faced with special levies that are extra charges to cover emergency repairs or upgrades to communal areas of the complex.
"For instance, if the roof of the complex needs repair and there’s not enough money in the reserve fund, every unit owner will be expected to contribute. A well-managed body corporate with solid financial reserves prevents these unpleasant surprises," Odendaal said.
Impact on property value
Mismanagement of the body corporate can impact the overall value of the entire complex and, therefore the individual units of the property as well.
Potential buyers are likely to avoid complexes with high levies, poor maintenance, or management issues. Over time, the condition of the common property will further deteriorate, which can cause the resale value of your property to decline making it harder to sell.
Enforcing conduct rules
It is also responsibility of the body corporate to enforce the rules of the complex which may include guidelines about pets, noise levels, use of communal areas, and parking, according to Odendaal.
Odendaal said that a well-run body corporate will ensure that these rules are fairly enforced, which helps maintain peace and order in the complex.
On the other hand, a body corporate that is poorly managed may fail to resolve disputes or apply rules consistently, which can lead to frustration and issues with neighbours.
IOL Property