Why It’s Important to Inspect the Scheme’s Financials Before Purchasing

Buying into a Sectional Title Scheme? Make sure you’re not just looking at the property — take a close look at the Scheme’s financials too.

Here’s why:

Hidden Risks – A beautiful property can hide serious financial trouble. A Scheme with high arrears or cash flow issues may require special levies down the line.
Clarity on Levies – Financial statements give insight into whether levies are realistic or if they may soon increase to cover shortfalls.
Debt Transparency – You’ll see if owners are defaulting, which can affect service delivery and long-term maintenance.
Maintenance Reserve Fund Health – In terms of the Sectional Titles Schemes Management Act, every Scheme must have a maintenance reserve fund. If it’s underfunded, that’s a red flag.

Before signing an offer to purchase, request the Scheme’s latest audited financials and budget from the seller.

ANGOR can help you understand what to look for.

Know your rights and responsibilities when buying into a residential community

Unexpected costs when buying a property: Essential expenses to budget for

The Importance of Inspecting a Scheme’s Financials before buying