Sectional title management: a complete South African guide

What a sectional title scheme is

A sectional title scheme divides a building or development into individually owned 'sections' (the units) and 'common property' (shared areas such as gardens, corridors, lifts, the roof and external walls). When you buy in a scheme you own your section plus an undivided share in the common property.

The scheme is governed by two pieces of legislation working together. The Sectional Titles Act (Act 95 of 1986) deals with the survey, registration and ownership side — sections, exclusive use areas and the sectional plan. The STSMA (Act 8 of 2011) deals with management — the body corporate, trustees, funds, rules and meetings. Day-to-day sectional title management lives mostly under the STSMA.

The body corporate

The body corporate is the legal entity that owns nothing of the sections but is responsible for the common property and the scheme's affairs. It comes into existence automatically when the developer transfers the first unit to a new owner — no separate registration step is needed.

Every registered owner is automatically a member of the body corporate; you cannot opt out. The body corporate's core duties generally include maintaining the common property, insuring the buildings, raising levies, keeping proper financial records and enforcing the rules. It acts through its trustees and, in many schemes, through a managing agent appointed to carry out the work.

Trustees and the managing agent

Trustees are elected by the members, usually at the AGM, to manage the scheme between general meetings. They make decisions at trustee meetings, oversee finances, approve maintenance and enforce conduct rules. Trustees act in a fiduciary capacity and must put the scheme's interests first.

A managing agent is a professional appointed under a written contract to handle the administrative, secretarial and financial functions — collecting levies, paying suppliers, preparing budgets and financial statements, and convening meetings. The managing agent works for the trustees, not instead of them; the trustees remain accountable for the scheme.

Managing agents who handle scheme money operate in a regulated space. They generally need to be registered with the Property Practitioners Regulatory Authority and hold a valid Fidelity Fund Certificate under the Property Practitioners Act 22 of 2019, and scheme money must be handled through a properly run trust account. Confirm the current registration and trust-account requirements against the Act and the regulator before relying on any specific obligation.

• Trustees: elected, fiduciary, set policy and approve spending.
• Managing agent: contracted, executes admin and finance, reports to trustees.
• Owners: vote at general meetings, pay levies, comply with rules.

Participation quota and the levy roll

Participation quota (PQ) is a percentage assigned to each section, calculated broadly from the floor area of the section relative to the total. PQ matters for two main reasons: it usually determines each owner's share of the levy, and it affects voting value on certain resolutions.

The levy roll is the master schedule listing every unit, its owner, its participation quota and the levy raised against it. It is the backbone of levy collection — it tells you who owes what, tracks arrears and feeds the body corporate's income. Keeping the levy roll accurate, and reconciling receipts against it, is one of the most important jobs in sectional title management.

The two funds: administrative and reserve

The STSMA generally requires a body corporate to maintain two distinct funds. The administrative fund covers day-to-day running costs — insurance, utilities for common areas, cleaning, security, managing-agent fees and routine repairs. The reserve fund is set aside for future maintenance and the replacement of major components such as roofs, lifts and tarmac.

Bodies corporate are required to prepare a written maintenance, repair and replacement (MR&R) plan and to fund the reserve in line with it. The regulations set rules about minimum reserve-fund contributions linked to the size of the reserve relative to the annual budget; because these thresholds can change, confirm the current figures in the prescribed management rules rather than relying on a remembered percentage.

Keeping the two funds separate — and not raiding the reserve to cover an admin shortfall — is both a legal expectation and sound financial practice. It is also the area where trustees most often need a competent managing agent and clean accounting.

Budgets, levies and the AGM

The annual general meeting is where the body corporate approves the budgets for both funds, considers the financial statements, elects trustees and deals with insurance and other resolutions. Members must be given proper written notice of the AGM, with the agenda and supporting documents, within the period set by the rules.

Levies flow from the approved budgets. Once members approve the administrative and reserve budgets, the trustees raise levies against each unit — generally in proportion to participation quota — and may also raise special levies for unbudgeted expenses. The decision to impose a special levy normally rests with the trustees, subject to the rules.

Different decisions need different majorities — ordinary resolutions, special resolutions and unanimous resolutions each have their own threshold and notice requirements. Because getting the resolution type wrong can invalidate a decision, check the specific majority required for the action you are taking against the prescribed management rules.

Conduct rules and maintenance

Every scheme operates under two sets of rules: management rules (governance, meetings, finances) and conduct rules (behaviour — pets, noise, parking, refuse, use of common areas). Schemes start with the prescribed rules in the regulations and may amend or add to them, subject to CSOS approval of rule changes.

Maintenance responsibility splits along the section/common-property line. Owners maintain the inside of their own sections; the body corporate maintains the common property and the building's structural and external elements. Exclusive use areas (like an allocated parking bay or garden) are a common grey zone — the holder usually carries the cost of upkeep even though it remains common property, so confirm how each exclusive use area is treated in the scheme's rules.

Good maintenance management means inspecting the common property regularly, logging issues, prioritising against the MR&R plan and keeping a clear record of what was done and when.

CSOS oversight

The Community Schemes Ombud Service, established under the CSOS Act 9 of 2011, provides oversight of all community schemes, including sectional title bodies corporate. Its role spans dispute resolution (an accessible alternative to court for levy disputes, rule enforcement, nuisance and governance complaints), governance scrutiny, and the collection of a CSOS levy.

Schemes are generally required to register with CSOS, lodge governance documentation such as approved rules and annual financial information, and pay the CSOS levy calculated on the scheme's levy income. The exact registration, filing and levy-calculation requirements are set by CSOS — confirm the current thresholds and forms directly, as they are updated from time to time.

For trustees and managing agents, CSOS changes the management mindset: decisions need to be defensible, records need to be complete, and rule enforcement needs to follow due process, because a disgruntled owner can take a dispute to the Ombud rather than simply absorbing it.