Buyer Guide
Body Corporate and Levies Explained
The body corporate is the legal entity that governs a sectional title scheme in South Africa. It is created automatically when the first unit transfers, every owner is a member, and the trustees run it on behalf of all owners under the Sectional Titles Schemes Management Act 8 of 2011. Understanding how it works is essential before buying any sectional title unit.
Authored by the Africa Estate residential specialist team.
What the body corporate does
The body corporate manages the common property (land, external walls, roof, communal spaces), insures the buildings, contracts the security and cleaning providers, holds the reserve fund for major capital expenditure, raises and collects levies, and enforces the conduct and management rules. Every decision is taken by the trustees (within their delegated authority) or the AGM (for major items).
Trustees
Trustees are elected from the owner body at each AGM. They run day-to-day decisions on behalf of the body corporate, within the framework set by the management rules and the AGM. Trustees are not paid for the role (with limited exceptions for chair and treasurer). A well-managed scheme has experienced, engaged trustees; a poorly managed scheme has trustees who do not turn up.
Annual General Meeting
Every body corporate must hold an AGM within four months of the financial year end. The AGM approves the annual financial statements, approves the budget for the next year and therefore the levy, elects trustees, and votes on any special resolutions (rule changes, major capital expenditure, sale of common property, alterations to the sectional plan).
Special resolutions require 75% of votes cast (by participation quota) and 75% of votes cast (by number of owners present). Unanimous resolutions require all owners. Ordinary resolutions require a simple majority.
Management rules
The management rules govern how the body corporate operates: trustee elections, meetings, voting, financial controls, insurance, common property maintenance, reserve fund, levy raising and recovery. Schemes can adopt customised management rules at registration; in practice most schemes use the prescribed management rules from the Sectional Titles Schemes Management Regulations.
Conduct rules
Conduct rules govern what owners and occupants may and may not do in the scheme: pets, noise, alterations, business use, short-term letting, parking, decoration of common areas, garden maintenance, signage, satellite dishes. Conduct rules are scheme-specific. Always read them before buying.
Common conflict points in older schemes include rules against keeping pets, rules limiting Airbnb-style letting, rules requiring trustee consent for any alteration visible from the outside, and rules on the colour and style of window coverings.
How levies are calculated
The trustees prepare an annual budget covering operating expenses (insurance, security, cleaning, maintenance, accounting, audit), reserve fund contribution (required by the Act, minimum 25% of administrative expenses), and any other anticipated cost. The budget is presented at the AGM. On approval, each owner pays a monthly levy equal to their participation quota share of the annual budget divided by twelve.
A larger unit pays a larger levy. An owner cannot opt out of the levy. Levies fall due in advance each month and arrears attract interest at the rate set by the body corporate (often prime plus 2% to 5%).
Special levies
A special levy is raised when a one-off cost (roof replacement, painting, lift overhaul, plumbing failure) exceeds the reserve fund and cannot wait for the normal budget cycle. Special levies require trustee approval and a body corporate resolution. They can be substantial. Always ask whether a special levy is planned, under discussion, or recently raised before buying any sectional title unit.
Arrears, recovery and the CSOS
Levy arrears are recovered through the courts. Body corporate disputes (between owners, between an owner and trustees, between an owner and the body corporate) can be referred to the Community Schemes Ombud Service (CSOS), a statutory body that provides a faster and cheaper alternative to court for most scheme disputes. Always ask for the CSOS levy compliance status: if the scheme has not paid its CSOS levies, that is another red flag.
Buying into a sectional title scheme?
Africa Estate suburb specialists know the well-managed schemes from the troubled ones. Ask before you sign an offer.
Frequently asked questions
Can I attend body corporate meetings before buying?
Not as a non-owner, but you can request copies of the last AGM minutes, the most recent annual financial statements, the levy roll showing arrears, and the management and conduct rules through the offer to purchase as a suspensive condition. Most well-managed schemes provide these on request. If a scheme refuses, treat it as a red flag.
What is a special levy?
A one-off levy raised by the body corporate to fund a specific project (roof replacement, painting, lift overhaul, major plumbing) that exceeds the reserve fund balance. Special levies can be substantial, sometimes equal to several months of normal levies. Always ask whether any special levy is planned or under discussion before buying.
How are levies calculated?
Each unit has a participation quota, calculated as the floor area of the unit divided by the total floor area of all units. The annual budget is divided across owners in proportion to their participation quota. A larger unit pays a larger share. The body corporate trustees prepare the budget; the AGM approves it.
What happens if a neighbour does not pay their levies?
The body corporate sues for the arrears in the relevant court (high court or magistrate court depending on amount). Persistent arrears can lead to a judgement and ultimately the sale in execution of the unit. The arrears attach to the unit and must be settled at transfer. Always ask for the levy roll to confirm scheme-wide arrears are under control before buying.