A refresher on the 10-year maintenance plan

In the past, sectional title schemes have often struggled when major maintenance repairs were needed. It became a contentious issue, with owners being placed in financial difficulty due to poor planning. Because of this, the Sectional Title Schemes Management Act was amended in 2016, making it compulsory for schemes to have a 10-year maintenance plan. De Lucia Group unpacks the plan to ensure you stay on the right side of the law.

What is the 10-year maintenance plan?

The maintenance, repair, and replacement plan (MRRP) ensures bodies corporates are better able to anticipate and overcome major future expenditure. According to the revised Sectional Title Schemes Management Act, it sets out:

1. Major capital items: Valuable items that are expected to require maintenance, repair, and replacement within the next 10 years.

The Act defines major capital items to include the following: wiring, lighting and electrical systems, plumbing, drainage and storm-water systems, heating and cooling systems, any lifts, any carpeting and furnishings, roofing, interior and exterior painting and waterproofing, communication and service supply systems, parking facilities, roadways and paved areas, security systems and facilities and any other community and recreational facilities.

2. Current state: The current state or condition of major capital items.

3. Time: The estimated time when those items or the items' components will need to be repaired or replaced.

4. Estimated cost: The estimated cost of the maintenance, repair, and replacement of the items' or its components.

5. Life expectancy: The expected life or longevity of those items/components after maintenance, repairs, or replacement.

6. Other: Additional information the body corporate deems relevant.

Importance of a 10-year maintenance plan

Besides being a legal requirement, the MRRP is beneficial for sectional title schemes. Maintenance of a property is an inevitability, and the plan assists in the financial planning of large projects. 

A well-defined plan can ensure bodies corporate and trustees plan ahead while considering the financial impact. If done properly, it can prevent the need for special levies. It ensures the body corporate is transparent about the maintenance process and allows the scheme owners to hold them accountable. 

Finally, careful maintenance of the scheme through the plan keeps it in tip-top shape. A scheme in good shape will see its property values grow and make it easier for owners to sell at any point. 

The danger of not having a 10-year maintenance plan

If the sectional title scheme doesn't have a maintenance plan, it puts the owners at risk of paying special levies for major maintenance projects. The maintenance plan is an important responsibility for bodies corporate and trustees so it can lead to dismissal or impact chances of being re-elected. 

Beyond this, it's important to also continually update the maintenance plan as items are attended to and new items added. This allows the body corporate to allocate funds correctly and prevent incorrect levy calculations. 

How to put a 10-year maintenance plan into place

The process can be a difficult and time-consuming initiative for the body corporate or trustees. Instead, you can employ a property company to assist you with your MRRP. They can:

• Inspect the property and come up with maintenance costs that comply with the Act's legislation. 
• Put together a report which includes a life-cycle cost analysis, a 10-year forecast of maintenance, repair, and replacement costs, as well as a corresponding reserve fund forecast and contribution schedule. 
• Prepare an MRRP document based on the findings and present it at the Annual General Meeting (AGM).
• Assist with carrying out maintenance, repair, and replacement projects related to the plan.

Make 10-year maintenance planning simple

De Lucia Group are property management experts, with years of experience in handling sectional title schemes. As part of our services, we can provide a periodic review of the estimates of expenditure and maintain your 10-year schedule of maintenance and repairs. To get started, send a message to De Lucia Group. You can also call Michael De Lucia directly on 082 493 1089 or email michaeldl@delucia.co.za to get started.

 - visit our website

 - like and view us on Facebook

 - connect via LinkedIn