Apartment to buy but mgt fees seem high. Any rules of thumb as a guide?

D

Devestor

Guest
Been looking for an apartment to buy but the managment fees seem all over the place. Is there a some good rules of thinbs to know if you are been ripped off.

For example There was an apartment I looked at on Wexford st - basic 3 story building 8 apartment. It was 1500 a year for a 1 bedroom place that would probably fetch 700 if rented. No parking or lift or grounds and corridors were grimmy - not falling apart. imagine store room in a supermarket level of paint job.

Basically I presume this seems too much.

How much extra should lifts cost, Or parking space. It'd be nice to know what you should expect to be reasonable.
 
I would think the law of large numbers applies here - the more apartments there are the lower it will be. you also have to factor in the the costs of the insurance. Most buildings on Wexford Street would be quite old and insurance cost would be high.
 
A bigger issue that the amount of the fees would be the state of the management company accounts. For a few euro you can get a copy of the last filed accounts from cro.ie - this will give you an idea of where the fees go, outstanding debts etc
 
Take the lift as an example. It depends on what service contract they have on the lift, is it 24/7 or a 5 day week. Are they covering replacement of parts from current budget or a sinking fund? Is the phone line part of the lift cost or a separate budget item? What is the lift to unit ratio?

Every cost is different as developments have varying characteristics, you need to look at the budget to see if it matches up to a reasonable overall picture, so if 40% of the budget goes to a management agent fee, it is probably not good for you.

Most important thing to check is a sinking fund. No point in finding a cheap annual fee if they have not been putting money aside to replace the roof in two years time. It would end up with you getting a fee of €20k that year to pay for the roof.
 
A good average for the sinking fund is a figure roughly 85 to 90 % of annual income.

€1500 euro for a one bed seems a bit excessive.
 
To put that in context, we pay €1100 for a 3 bed in West Dublin..own door but refuse and landscaping is included.
 
shesells said:
For a few euro you can get a copy of the last filed accounts from cro.ie - this will give you an idea of where the fees go, outstanding debts etc
Click to expand...

These matters should be available to inspect as part of the information pack available to purchasers.
 
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