Management Fees coming down?

F

finty

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Hey there,

I'm trying to gauge whether the deflation in the economy is being match by deflation in apartment management fees. I'm just back from my companies AGM and it looks like they are trying to put ours up........crazy!!


So here goes,


paying 2400 for a 4 bed apartment in D15 and looks like the fees will be going up by about 5%
 
Do the owners have control of the management company? Did you suggest things to be cut from the budget?
 
Contractor prices should be coming down but if the development is run down and in need of (major) repairs or has a lot of people not paying their fees, the management company may not be able to afford a reduction. Also, if you don't have a proactive management committee/agent, they might not be looking for cheaper rates from contractors. Just some food for thought.
 
Are your fees a % of the budget for the entire development? We saved 6k per year by changing gardener. Having said that for 2010/11 we face leaving our fees as is, or introducing a paint levy or wiping out our entire sinking fund to pay for common area funding. What stage is your development at?
 
Your fee is a share in the operation and upgrade of the development where the work that is done or service provided may change from year to year based on maintenance cycles, market conditions etc. The budget should show you where increases are occurring. I would speculate that the block insurance is probably contributing substantially to increased costs for the coming year.

It is all about value for money. Are the management company seeking quotes for all of the services on a regular basis or just sticking with the providers that they have always had regardless of cost? Are any of the activities carried out by agents of the management company unnecessary and warrent being cut back?

they are trying to put ours up........crazy!!
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Not sure who 'they' is as you are a member of the management company. If the development is fairly new and 'they' refers to the developer than it is important to get more control in to the hands of the owners.
 
finty said:
Hey there,

I'm trying to gauge whether the deflation in the economy is being match by deflation in apartment management fees. I'm just back from my companies AGM and it looks like they are trying to put ours up........crazy!!


So here goes,


paying 2400 for a 4 bed apartment in D15 and looks like the fees will be going up by about 5%
Click to expand...

2 bed duplex type own door apartment, Co. Louth, no lifts or internal communal areas.

2008-2009 €800, recently got bill from Management Company for 2009-2010, down 14% due to savings achieved in the cost of services provided.
 
sorry seem to have opened a discussion about lots of stuff.


Thanks for your points but I just wanted to get an idea whether people were seeing a reduction or an increase in management fees................
 
I think your answer is entirely dependant on the situation in each development and management company. You simply can't compare it to the price of food or the larger cost of living unless it's being run properly. And I'm sorry to say that most developments aren't
 
Bear in mind that if the Multi Unit Development Bill is passed Management Companies will be obliged by law to have a definite contribution each year to the Sinking Fund. The Bill mentions a minimum payment of €200. So if you have no Sinking Fund this is coming down the track.
 
finty said:
sorry seem to have opened a discussion about lots of stuff.


Thanks for your points but I just wanted to get an idea whether people were seeing a reduction or an increase in management fees................
Click to expand...



Mine came down from €1700 to €1500 for next year.
 
Yorrick said:
Bear in mind that if the Multi Unit Development Bill is passed Management Companies will be obliged by law to have a definite contribution each year to the Sinking Fund. The Bill mentions a minimum payment of €200. So if you have no Sinking Fund this is coming down the track.
Click to expand...

In most developments this is going to push fees up hugely. It's about 3 times what our development (which already has a healthy sinking fund) is contributing per year at the moment.
 
per unit per year. This is very arbitrary and takes no account for the massive variations in capital investments that will be required in multi-unit developments in the future. The contribution to the sinking firm should be based on a calculation of the projected costs of lift replacement, window replacement, resurfacing of paths, roads etc. In some schemes this may require a contribution of significantly more that €200 and it other schemes it may be less.

In the future this will be a significant consideration for prospective purchasers of second hand units. Will I get hit for a €12k management fee next year because there is no sinking fund to replace the windows?
 
Well I'm afraid that the chickens are coming home to roost. Many Irish people rushed into buying apartments without understanding the whole concept of Management Companies. Mangement Fees, Sinking Funds etc. The legislation is meant to regulate this area. It is vital that every owner gets involved with their management and make them accountable at the A.G.M.
 
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