What are levies, property levies, property levy laws?
What are property levies? To understand the laws governing property levies, it's important that you have the fundamental knowledge first.
Understanding how property levy laws work
To understand the laws governing property levies, it’s important that you have the fundamental knowledge first. Here’s a quick refresher:
What are levies?
Sectional title owners (people who own property in complexes or flats) are required to pay a monthly fee to cover routine maintenance of communal areas, which aren’t inside the owner’s home.
What do property levies pay for?
Levies are used to cover costs for the maintenance and upkeep of the communal areas and needs within the boundaries of the complex. These include public pools, gardens, public infrastructure, etc.
Property levy laws: A basic outline
Levy management is the responsibility of the body corporate of the complex. This has been clearly set out by the Sectional Titles Act of 1986. This Act ensures that both owners and those within the body corporate are legally protected.
- Levy management: The Act ensures that a body corporate manages sufficient funding for the upkeep that levies cover. The body corporate cannot dictate the use of levies outside of those stipulated by the Act.
- Levy debt: The Act ensures that each resident is contractually bound to pay a designated amount towards the levies. Failing to do so will be punishable by law, enforced by an attorney, should the body corporate deem such measures necessary.
- Property schemes: The Act ensures that property schemes are required to build up minimum reserve funds.
- Levy increases: The Act grants trustees the discretion to increase levies by no more than 10% at the end of a scheme’s financial year, but ensures that sufficient notice is given to the residents before implementation.
- Special levies: The Act ensures that ‘special levies’ are governed fairly and implemented with fair notice to the residents. The body corporate does not have the authority to set levies outside of those stipulated by the Act.
Property levy laws can be complicated. If you have any specific questions, or need some advice, please feel free to Mansfield Property Solutions.
