Renting out your place and management fees

T-rev

Renting out my place soon and I have management fees of about 71 per month but I didnt include these into the rent which is €800 pm.

Should I have included them into the rent or can I ask the tenant to pay these directly to the management company. They are for bins, cleaning of the common hall area, windows, etc etc.

Any advice appreciated.

Penguino

Generally the landlord pays the management fees.

You could try to increase the rent to include the fees but you don't want to over price the property out of the market or it could be left idle for some time

Paulw

It's the unit owner's responsibility to pay management fees, not the tenant.

If you didn't include the fee in your rent, then it's your own mistake. You could try increasing the rent, but other than that, you must pay the fees and then what's left is your rent.

T-rev

Yeah gonna chat to the tenants and see what they say about it. Wouldnt say it will be a problem because they are getting a very good deal for the rent they are paying.

OMD

T-rev wrote: »

Renting out my place soon and I have management fees of about 71 per month but I didnt include these into the rent which is €800 pm.

Should I have included them into the rent or can I ask the tenant to pay these directly to the management company. They are for bins, cleaning of the common hall area, windows, etc etc.

Any advice appreciated.

As a tennant would you pay €71 a month to have your bins collected and the hallway cleaned? This is your bill I am afraid.

T-rev

Yeah you'd think that alright but I would say they'll be fine with it. I have not seen a rent to match what they are getting anywhere in Dublin.

Kosseegan

A big element of the management fees is the building insurance which has nothing to do with the tenant. Maintenance of parts of the building unconnected with the unit occupied by the tenant is also of no interest to the tenant.
Aside from the fact that it is usual for the landlord to pay service charges these should have been specified in the lease and advertising before the letting was agreed. The tenants are under no obligation to agrre to a revision of the letting agreement and in fact it is a breach of the Residential Tenancies Act to try and do it within 12 months of the lease commencing.

T-rev

Just aswell there is no lease signed or even looked at yet then.

Thanks tho for your concern.

greendom

You should be able to claim back management fees against any tax you pay on the property.

Paulw

greendom wrote: »

You should be able to claim back management fees against any tax you pay on the property.

No, you can only claim back a small portion of your management fees on the tax.

athtrasna

Paulw wrote: »

No, you can only claim back a small portion of your management fees on the tax.

That's only the case if you're an owner occupier. If you rent your property in a managed development the fees are 100% tax deductible. Totally unfair IMO.

OP I have never heard of a tenant being asked to pay management fees, as they are tax deductible they are actually not costing you anything. That is assuming you register for tax, with the PRTB etc

beeno67

athtrasna wrote: »

as they are tax deductible they are actually not costing you anything. That is assuming you register for tax, with the PRTB etc

being tax deductible does not mean they cost nothing. Assuming he is a top rate tax payer it means they will cost him approximately half. He still has to pay the rest.

not even wrong

T-rev wrote: »

Just aswell there is no lease signed or even looked at yet then.

Thanks tho for your concern.

Even in the absence of a signed lease, trying to increase the agreed rent like this is pretty slimy behaviour. I hope the tenant tells you where you can stick your management fee.

mikemac

not even wrong wrote: »

Even in the absence of a signed lease, trying to increase the agreed rent like this is pretty slimy behaviour. I hope the tenant tells you where you can stick your management fee.

I read it as the place is vacant the OP hasn't gotten any tenants yet

athtrasna

beeno67 wrote: »

being tax deductible does not mean they cost nothing. Assuming he is a top rate tax payer it means they will cost him approximately half. He still has to pay the rest.

How do you work that out? Tax on a rented property is calculated on income minus allowable deductible expenses? According to the forms we get every year from out accountant anyway!

beeno67

athtrasna wrote: »

How do you work that out? Tax on a rented property is calculated on income minus allowable deductible expenses? According to the forms we get every year from out accountant anyway!

If you assume a 50% tax rate, just to make the figures simple. Let's say you have rent of €10,000 and expenses of €1000. If expenses were not allowed you would have to pay 5000 tax and 1000 expenses leaving you with €4000 net profit.

But on that basis that expenses are allowed you pay tax on 9,000 or €4500 tax and €4500 net profit. The €1000 expenses have reduced your tax bill by €500 but not the full €1000.

n900guy

OMD wrote: »

As a tennant would you pay €71 a month to have your bins collected and the hallway cleaned? This is your bill I am afraid.

As a tenant you have to pay these management fees in the UK and definitely Netherlands as well as I have discovered. Apartments will be quoted for the rent + the required management fees payable by the tenant as well.

Yawns

But this is not the UK and Netherlands. This is Ireland and tenants do not have to pay management fees as standard. In fact it'd be pretty hard to find a few tenants who do pay management fees.

Comparing to other countries systems of renting is useless. To the OP, as has already been pointed out your management fees will also be including your insurance for structural damage etc and is of no use to the tenant. It also covers bins, hallways, maintaining of the grounds and some other things sure but they only one of them that will really affect a tenant is the bins and possibly the hallways.

In my last house my bin charges were €12.50 a month in a house with 2 adults and 1 young baby. I certainly wouldn't pay €70 management fees.

n900guy

Yawns wrote: »

But this is not the UK and Netherlands. This is Ireland and tenants do not have to pay management fees as standard. In fact it'd be pretty hard to find a few tenants who do pay management fees.

Comparing to other countries systems of renting is useless. To the OP, as has already been pointed out your management fees will also be including your insurance for structural damage etc and is of no use to the tenant. It also covers bins, hallways, maintaining of the grounds and some other things sure but they only one of them that will really affect a tenant is the bins and possibly the hallways.

In my last house my bin charges were €12.50 a month in a house with 2 adults and 1 young baby. I certainly wouldn't pay €70 management fees.

Yes it isn't, as the Irish rental and property market is a complete mess. Is there anything to learn from other countries that maintain healthy rental markets with good standards of maintenance?

Well, we'll see. It can be written into any tenancy agreement and unless you are desperate for a tenant, better to wait for one that will pay for there own services and also meet minimum salary requirements. Do you have any comments on that aspect (salary) or larger deposits based on furnishings?

Houses usually have lower charges. But, if you are in an apartment complex and the interior is cleaned weekly, gardens maintained and so on. They are services that you can choose to pay for, or choose not to live there I suppose.

Yawns

This probably one of the biggest things that bugs me about apartment complexes. Why do gardens have to be cut every week? I suggested to the management company that maybe do it every 3 weeks. Not a lot of people use the gardens much and the only litter is leaves falling. So he actually did it and nobody has noticed a difference so far. so If the gardens only get done once or twice a month that's half the gardening fees saved there.

This a recession and if the gardeners insist on a yearly contract based on a weekly job then tell them to get lost, someone else will do it for your own terms.

As for LL's wanted you to earn at least 4x the rent. How would they verify this? Would they take you at your word that you work as the chairman of the GAA or would they want to verify with bank details etc? Don't forget your LL could be a rapist for all you know about him or worse Sean Fitzpatrick

I've been a good tenant and never left a place trashed or anything. In fact the partner insists on doing a big massive clean on the place before we leave as she hates leaving a mess. I wouldn't show a future LL bank account details, pay huge deposits or pay his management fees. If anything like that was in the lease I'd walk away in a heartbeat.

Yawns

n900guy wrote: »

Houses usually have lower charges. But, if you are in an apartment complex and the interior is cleaned weekly, gardens maintained and so on. They are services that you can choose to pay for, or choose not to live there I suppose.

Realistically in Ireland which way do you see that working out for the whole country? In a house I wouldn't cut my grass every Sunday either. I pay for my bins to be collected when they are full and I get to choose who collects them so I can avail of a better price.

I live in an apartment at the moment and for every 4 apartments there's a shared hallway. It's kept clean by the residents themselves more so than the cleaners these days. The cleaners were in once a week like the gardeners but that's been reduced now and the management fees for the owners has been reduced.

If you want cheaper management fees then get someone with a decent head on their shoulders to take care of things.

Your post just seems typically Irish to me. LL buys an apartment and then instead of paying the management fees he's agreed to, he wants to lump it on to someone else. I can answer that like you answered yours. If you don't want to pay the fees then don't choose to buy the place that comes with fees.

They are services that you can choose to pay for, or choose not to live there I suppose.

n900guy

Yawns wrote: »

Your post just seems typically Irish to me. LL buys an apartment and then instead of paying the management fees he's agreed to, he wants to lump it on to someone else. I can answer that like you answered yours. If you don't want to pay the fees then don't choose to buy the place that comes with fees.

Damn right, typically stupid Irish!!

If I was typically British or Dutch, I would have demanded salary levels on a contract that was for at least 1 year, payment for parking, payment for service costs and 2-3 months deposit.

Perhaps tenants are lucky there are stupid Mick landlords like me!

Kimia

What are you on about? ^^

I think the main thing to remember here is that if you are one of the very very few landlords to charge a monthly management fee, when pretty much no-one else is, why on earth would tenants want to rent from you?

n900guy

Kimia wrote: »

What are you on about? ^^

I think the main thing to remember here is that if you are one of the very very few landlords to charge a monthly management fee, when pretty much no-one else is, why on earth would tenants want to rent from you?

Well if we are to believe what is commonly thought, there are a lot of under the table unregistered tenancies going on. Perhaps the landlords don't make too much of a fuss as it's all kept off the books? I don't know.

Here is an example of requirements here (I have this in my hand at the moment, which is where I am getting the information from!). This a standard print out for anyone looking to get a private tenancy - I got it from an estate agent.

Gross monthly income is at least 4 times the monthly rent (excluding service costs and utilities)
Passport
Recent salary slip
Employer's declaration
Declaration from current landlord
Declaration from bank

Otherwise - landlord simply refuses the tenancy. It's incredible tightly controlled but obviously, once you have everything in place, you have a lot more rights as well and tenancies for 2-3years+ can happen.

I hpoe things don't go back to the dingy bedsit model of tenancies like 20 years ago. The way out is surely up front well regulated models similar to what works well in a place with 50%+ social housing like NL.

Kimia

n900guy wrote: »

Well if we are to believe what is commonly thought, there are a lot of under the table unregistered tenancies going on. Perhaps the landlords don't make too much of a fuss as it's all kept off the books? I don't know.

Here is an example of requirements here (I have this in my hand at the moment, which is where I am getting the information from!):

Gross monthly income is at least 4 times the monthly rent (excluding service costs and utilities)
Passport
Recent salary slip
Employer's declaration
Declaration from current landlord
Declaration from bank

Otherwise - landlord simply refuses the tenancy. It's incredible tightly controlled but obviously, once you have everything in place, you have a lot more rights as well and tenancies for 2-3years+ can happen.

I hpoe things don't go back to the dingy bedsit model of tenancies like 20 years ago. The way out is surely up front well regulated models similar to what works well in a place with 50%+ social housing like NL.

And what in return does the tenant get? Bearing in mind the current practice of lots of landlords - for example:

• Not returning deposit
• Taking money out of deposit for non-existent 'cleaning' or re-furnishing the place at the tenants expense
• Not fixing items asap
• Entering the premises without permission

And further, why would the tenant bother with you, Landlord A, when you're asking for all these things, when Landlord B, isn't.

n900guy

Kimia wrote: »

And what in return does the tenant get? Bearing in mind the current practice of lots of landlords - for example:

• Not returning deposit
• Taking money out of deposit for non-existent 'cleaning' or re-furnishing the place at the tenants expense
• Not fixing items asap
• Entering the premises without permission

And further, why would the tenant bother with you, Landlord A, when you're asking for all these things, when Landlord B, isn't.

Landlord B does all those things and Landlord A doesn't? Pay more for a better quality landlord? Pay low for a risk - he may steal your deposit, enter without permission.

Frankly, that stuff really disturbs me as I don't really comprehend what is going on but it's not normal. I meet my tenant every 6 months or so to collect mail and at his request to check everything is working in order. Maybe I live in a bubble, I am not a professional slumlord!

but, here (Holland) is a very different world for tenants. Great tenancies but you ahve to come up with much more security up front.

Kimia

n900guy wrote: »

Landlord B does all those things and Landlord A doesn't? Pay more for a better quality landlord? Pay low for a risk - he may steal your deposit, enter without permission.

Frankly, that stuff really disturbs me as I don't really comprehend what is going on but it's not normal. I meet my tenant every 6 months or so to collect mail and at his request to check everything is working in order. Maybe I live in a bubble, I am not a professional slumlord!

but, here (Holland) is a very different world for tenants. Great tenancies but you ahve to come up with much more security up front.

I think you may have misunderstood me. I was asking what does the tenant get in return for the hoops they have to jump through for you? I was also pointing out the current problems that lots of tenants face in Ireland so my second question is why on earth would they pay more for what is already a risky investment?

Yawns

Just because Landlord A demands 3x months deposit, checks passport and demands to know salary does not mean he is suddenly the better landlord. He can still not fix things, he could still charge for cleaning or wear n tear repairs, he could still withhold the deposit and then the tenant suddenly has no deposit and has to bring him to courts for about 3k.

mikemac

n900guy wrote: »

This a standard print out for anyone looking to get a private tenancy - I got it from an estate agent.

Gross monthly income is at least 4 times the monthly rent (excluding service costs and utilities)
Passport
Recent salary slip
Employer's declaration
Declaration from current landlord
Declaration from bank

For that amount of hoops to jump through I'd be looking for bank statement off the landlord!
As I've seen a case where tenants move in, sign a 12 month lease and one month later the landlord sells the house and the tenants are put out for the buyers. In fact in Ireland you can put out a tenant to move a family relation in.
However if the tenants moved out after one month they'd lose their deposit, hardly fair

n900guy wrote: »

Well if we are to believe what is commonly thought, there are a lot of under the table unregistered tenancies going on. Perhaps the landlords don't make too much of a fuss as it's all kept off the books? I don't know.

Oh believe us there are. And don't they think they are cute hoors.
But hey so did the people in the 80's with their Ansbacher accounts

The €400 (or whatever it is now) was not introduced just as money back for tenants. It was introduced to encourage tenants to give information on landlords.

They are incredibly useless and incompetent government departments. The Revenue is not one of them.
And one of these days they'll announce an amnesty and the money from unregistered landlords will come rolling in.
They don't care if you come forward, penalities and interest will cover the rest. I know you're living in the Netherlands so maybe this doesn't apply to you

n900guy

feelingstressed wrote: »

For that amount of hoops to jump through I'd be looking for bank statement off the landlord!
As I've seen a case where tenants move in, sign a 12 month lease and one month later the landlord sells the house and the tenants are put out for the buyers. In fact in Ireland you can put out a tenant to move a family relation in.
However if the tenants moved out after one month they'd lose their deposit, hardly fair

Yes that is very unfair. There are no checks as to whether the reason to end the tenancy in the first six months is also a real reason AFAIK. Assuming there will be less people keen on buying in Ireland for the next generation, better and longer term tenancies are needed IMO - lower rent for longer lease terms?

As to the hoops - well as I am seeing here (only over briefly!), there are a lot more tenant protections. But, you also see a lot of places with e.g., no floor so you have to put in a floor as a tenant (yes insane sounding I know!). Sort of like Germany and the kitchens (you usually fit your own kitchen there AFAIK).

They don't care if you come forward, penalities and interest will cover the rest. I know you're living in the Netherlands so maybe this doesn't apply to you

Well obviously they have their own system but it's interesting to compare as the cities are comparable in size much more than Dublin is to London for example. The council collects the taxes in the UK when you rent their and get on people's case within a week if it's late.

Why I am interested is that, there are many problems with some estates with half finished houses and dubious arrangements for management companies which is still some sort of magical place outside reality. E.g., the Elysian in Cork. Huge management service costs, but only 3 or so celebrity tenants. Who is maintaining it? At what cost?

It all strikes me as very ad hoc. I had no problems paying the service costs or Council taxes in the UK, because you see x goes to policing, y to water z roads around you, and so on.

A big danger I think is that basically blocks won't get management fees paid by landlords in trouble (5-6 buy to lets, etc., ), and the 80s style situation of simply low quality poorly maintained housing will return (if it ever went away in the first place).

Kimia

Kimia wrote: »

I think you may have misunderstood me. I was asking what does the tenant get in return for the hoops they have to jump through for you? I was also pointing out the current problems that lots of tenants face in Ireland so my second question is why on earth would they pay more for what is already a risky investment?

Are you purposefully avoiding my questions?