Neelam Rahim | neelam@radioislam.co.za

3-minute read
27 October 2024 | 18:50 CAT

In sectional title schemes and corporate bodies, trustees play a critical role. They must balance their fiduciary duties with the potential personal risks inherent in their position, including financial risks.

Managing a property can be a delicate balance, especially when trustees or managing agents abuse their authority, leaving property owners vulnerable. Experts warn that homeowners must remain vigilant to protect their assets.

“Property ownership in South Africa has evolved dramatically,” says Dr Gerhard Johannes Jooste, a seasoned expert in sectional title management and a consultant for managing agents. “In the past, owning multiple properties or holiday homes was less common, but now collective ownership models like cluster communities and homeowners’ associations are growing in popularity. With that growth comes new risks.”

Dr. Jooste points to trustees and managing agents who misuse their authority, leaving homeowners frustrated. “Imagine trustees granting relatives access to your property without consent or financial discrepancies that are only uncovered long after the damage is done. Unfortunately, these situations happen.”

He stresses that trustees have significant responsibilities, including managing finances, maintaining property, ensuring compliance with laws, and enforcing rules. Mismanagement in any of these areas can erode trust, harm the value of the property, and even jeopardize the financial health of the entire community.

“Financial mismanagement is especially problematic,” warns Dr. Jooste. “Whether through delayed payments or favoritism in maintenance contracts, poor oversight can lead to serious financial losses for homeowners. Annual and monthly financial reports are required by law, but it’s up to owners to demand transparency and accountability.”

Homeowners also have legal recourse. Dr. Jooste explains, “In sectional title schemes, the Sectional Titles Act guarantees owners the right to request financial and management reports. They should receive this information within 10 days. Staying informed is the first line of defense.”

While most trustees perform their duties with integrity, the growing complexities of property management demand heightened vigilance. Dr Jooste encourages homeowners to engage actively with trustees and managing agents. “Your dream property should remain an asset, not become a financial nightmare,” he concludes.

Listen here to the full interview on The Daily Round Up with Moulana Junaid Kharsany and Alie Komape.