"It is not just the value of your unit that you are protecting and managing, it is the value of the whole scheme, i.e. not just the R600 000 value of your flat, but if the scheme has 100 units, it’s actually a R60 million investment you are responsible for,” said Michael Bauer, general manager of IHFM, the sectional title management company.

“Trustees must see their body corporate as a business and take the work they do for it seriously,” said Bauer.  “The importance of being a trustee is often overlooked or underestimated by owners of units in sectional title schemes.”

“Trustees have a fiduciary responsibility, not just a management one.  They must realise that they are accountable.  If you are not aware of what is happening in your business you cannot plead ignorance, and it is the same if you are a trustee.  It is your job to know what is happening in your scheme.”

Bauer said, too, that even though there might be a very capable managing agent to whom the running of the scheme has been entrusted, trustees still need to supervise the managing agent and oversee the work that needs to be done or what money is paid out.

Good trustees will manage their schemes in the best possible way, with up to date maintenance, well controlled or managed arrears, no creditors, an overall good appearance to the building, no unsightly outer installations such as visible satellite dishes and no unresolved disputes within the scheme. 

The marketability of units in well managed schemes is very high and the market value of the units will increase steadily.

In the past when buyers applied for bonds in sectional title schemes it was granted if he could afford the repayments.  Now, however, the financials of sectional title schemes are checked by the banks in order to protect their buyers when applying for mortgage loans, so only if the scheme is sound and solvent will the bond will be granted.