select
|

Owners of units in sectional title schemes must not withhold levy payments

Owners of units in sectional title schemes might not see their levy account as a priority - but as this is actually the lifeblood of any body corporate, a person who withholds their levies for any reason is doing the body corporate harm, says Willem le Roux, director of sectional title finance company Propell.
 
Where Propell have been called in to assist in levy collections, there are various reasons given for the non-payments.  In most cases owners fail to speak to the trustees if they have problems with paying their accounts. Instead, they tend to just stop paying.
 
There are, however, ways of arranging payment plans with the body corporate, and it is preferable to arrange this before the amount outstanding becomes unmanageable.
 
Withholding levies is sometimes also used as a leverage tool if the owner is unhappy with something within the scheme, but this is not a solution to any problem, says le Roux.
 
A sectional title development that has levy collection problems will be unable to pay its creditors and keep the property maintenance up. This will eventually cause the property value to drop, and in turn, the owners’ investments will decrease in value.
 
Collection outstanding levies can take time, as the body corporate has to go through a legal process to claim amounts outstanding.  On discovering that levies are in arrears, they will usually first send a reminder for non-payment of the levy account to the owner, but if he ignores this, a letter of demand will be sent. If this letter is ignored, the owner will be handed over to attorneys, risking high legal costs and being listed as a bad payer on ITC.
 
If the levy account is handed over, the Sheriff will serve a summons. Summons can be either personally served or pinned to the front door of the unit, as this would be the listed legal address of the owner of the account unless the body corporate has been notified in writing of a different address. The owner will have ten working days to respond to the summons. If he fails to respond, the Sheriff will attach and sell the owner’s moveable property. If the proceeds of this sale is insufficient to cover the levy debt, the body corporate may ask the sheriff to sell the owner’s unit.
 
Owners who do not pay their levies should realise, says le Roux, that the trustees of the body corporate must use the full strength of the law to collect outstanding levies and they have a duty to the other owners to protect them and the value of their units.  


  Comment on this Article

  Please login to post comments

Post to my facebook wall
  
2000
Characters remaining


    Latest Property News
    • 17 Nov 2017
      FWJK has announced the launch of its latest residential brand, the Lil’ Apple, which will be launched simultaneously in two developments in Cape Town and Umhlanga totaling 600 apartments. The Lil’ Apple is set to be a brand of FWJK’s New York style apartments which will be rolled out nationally.
    • 17 Nov 2017
      It’s been a tumultuous year on many fronts, with socio-political uncertainty setting the tone for much of South Africa’s economic activity yet despite this and seemingly counter-intuitively, the residential property market has held up well.
    • 17 Nov 2017
      The EAAB (the Estate Agency Affairs Board) recently claimed that around 50,000 illegal estate agents could currently be operating illegally.
    • 16 Nov 2017
      Penthouses are synonymous with New York – characterised by high-rise living that is decidedly luxurious and spacious. While exclusivity comes at a price, you can still create a “penthouse” look and feel in your existing apartment or even the upstairs bedroom of a double storey house with some clever design changes and styling touches.
    • 16 Nov 2017
      The area has long been popular with kite surfers and, with escalating property prices in Cape Town itself, is increasingly in demand with home owners who work in town, but are looking to invest in more affordable properties.
    • 16 Nov 2017
      Cape Town’s popularity as a world-class tourist destination has resulted in a spike in the number of homes available for holiday lets and fuelled investor demand for sectional title units with short term rental potential.
    • 15 Nov 2017
      Sappi, one of South Africa’s oldest global companies and a leading global supplier of sustainable woodfibre products, has moved its global and regional headquarters to a new site on the corner of Oxford and 14th Avenue in Rosebank.
    • 15 Nov 2017
      There’s an old saying in real estate that you should seek to make a profit when you buy, not only when you sell – and a large part of succeeding at that endeavour is buying a home in an area with desirable features that will enhance the resale value of your property.
        
    X
    Subscribe to the MyProperty Newsletter

    Name  
    Last Name  
    Email Address  
    Email Frequency
    select
    X
    Share this Page

       
    For Sale Property
    Rental Property
    More Options
    About
    Connect with us
    FEEDBACK