Management Fees

[buzzment]

hi,what is the story with management fees?I am interested in a new house in a new developement and the fee is 600 euro a year.This seems a rip off for cutting a bit of grass etc.I have heard stories of the fee going up willy nilly every year also.What is the law on these companies,as far as i know they are not regulated and can charge what they like.

 

[John Rambo]

It's a function of what the expenditure is for the year. Regulation is coming down the tracks alright but for the moment it's a murky area. You, the members, are the management company, who engage a management agent to run it for you. They charge a fee which is deducted from the income (fees from owners). In my experience management fees are deliberately pitched low initially so as not to scare off purchasers. This results in a deficit which can only be wiped out by increasing the fees to the level they should have been at.I've two apartments, and the pattern has been thus) a) €1000 to €1300 to €1500 to €2000 to €2000 b) €1000 to €1200 to €1600

 

[ClubMan]

This seems a rip off for cutting a bit of grass etc.

"Etc." could be lots more - e.g. maintenance of roads, lighting, utilities (e.g. water mains, waste water infrastructure), insurance, sinking fund for contingencies etc. As your solicitor what the management company lease entails and what is covered by the management fee. As mentioned above these fees may change in the future. Oh - and it's not a rip-off if you are told what is being charged and what you will get for it. And remember that in most cases you would be a member/shareholder of the management company with the power (and arguably responsibility) to influence and control how things are run especially if you are not happy. See www.consumerconnect.ie for some consumer orientated information about management companies.

 

[CCOVICH]

There are still plenty of properties out there that are not privately managed-probably not new, but at least there is some choice as to whether or not you will be paying management charges.

 

[buzzment]

I dont care what you say it is a "rip off".Well I am looking into buying an old house now without "management" fees..definitely a put off..mortgages are expensive enough without additional costs to contend with.

 

[John Rambo]

I dont care what you say it is a "rip off".Well I am looking into buying an old house now without "management" fees..definitely a put off..mortgages are expensive enough without additional costs to contend with.

So it isn't a rip-off...you've looked at what it's going to cost and decided to look at buying an old house. Remember, with an old house you will spend a lot of money maintaining it.It's not a rip-off when you're told what something will cost, what you'll get for that price and then asked whether you want to fire ahead.

 

[ClubMan]

Exactly - you know what you will be charged at least in year one and you can find out (e.g. through your solicitor or by reading the management company lease agreement) what services your management fee buys you. There is nothing hidden or underhand here to constitute a rip-off. Obviously like any good or service with a price attached nobody can predict what the future holds in terms of price flucutuations.

 

[ailbhe]

We pay managment fees of 600 per year. It covers gardening, maintaining the roads and facilities (playground, parking, basketball court) and insurance and lighting. The green areas are maintained very well and I feel it's worth it as it keeps the estate looking well. It hasn't increased once in 2.5 years. There has been a profit every year and we have created a fund in order to paint all the houses in a few years (ensuring the colour scheme is maintained and no houses are left as eyesores).
So it doesn't bother me paying that amount.

 

[buzzment]

ha so when a dentist tells you it will cost 2 grand for a couple of crowns here and it costs you a few hundred in hungary it aint a rip off...mmm..ok if you say so using your analagy..anyways getting to the point at hand..no as i said it is a rip off..thats why im looking for an old house without management fees.bye all..thanks...

 

[RainyDay]

The management fees are set by the management company, which is owned and operated by the owners of the properties in question. So if you think it's a rip-off, you are effectively ripping yourself off.

There is a broader issue about local authorities avoiding their responsibilities to maintain public areas by ensuring that management companies take on this responsibility as a planning condition.

 

[CCOVICH]

thats why im looking for an old house without management fees.bye all..thanks...

Glad to hear it.

I don't think there is any point in leaving this thread open as it's heading into Letting Off Steam territory.

Thread locked.