Why pay managment fees

Hollister11

I live in a estate that was build just over 10 years ago. It's "managed" by a management company, and they charge €900 a year. I can't see where this is being spent, other then salaries for the suits. Bins are an extra €15 per week, and the security guard was let go. In fairness the fee was reduced by 200 when he was let go, but 900 seems like extortion.

EDIT: This is my parents property not mine. I live with them.

Allinall

Hollister11 wrote: »

I live in a estate that was build just over 10 years ago. It's "managed" by a management company, and they charge €900 a year. I can't see where this is being spent, other then salaries for the suits. Bins are an extra €15 per week, and the security guard was let go. In fairness the fee was reduced by 200 when he was let go, but 900 seems like extortion.

If you own the property you are a member of the management company and should get yearly accounts detailing all their income and expenditure.

Hollister11

Allinall wrote: »

If you own the property you are a member of the management company and should get yearly accounts detailing all their income and expenditure.

It's my parents property. I'm going to enquire about the accounts during the week.

ted1

Hollister11 wrote: »

I live in a estate that was build just over 10 years ago. It's "managed" by a management company, and they charge €900 a year. I can't see where this is being spent, other then salaries for the suits. Bins are an extra €15 per week, and the security guard was let go. In fairness the fee was reduced by 200 when he was let go, but 900 seems like extortion.

If you didn't pay you'd have the following costs.

House insurance 300 euro
Annual maintenance 200 euro
Sinking fund 400, to replace your boiler , pump, roof etc

Garden upkeep et mc

Yourself isit

Hollister11 wrote: »

I live in a estate that was build just over 10 years ago. It's "managed" by a management company, and they charge €900 a year. I can't see where this is being spent, other then salaries for the suits. Bins are an extra €15 per week, and the security guard was let go. In fairness the fee was reduced by 200 when he was let go, but 900 seems like extortion.

Insurance, electricity, maintenance, painting, and a sinking fund (new law since 2011)

Atlantic Dawn

It's a cheap way for the council to not be involved in the maintenance costs of the estate, makes planning permission easier, provides a constant source of income for those living off the backs of others, it's the future.

Hollister11

ted1 wrote: »

If you didn't pay you'd have the following costs.

House insurance 300 euro
Annual maintenance 200 euro
Sinking fund 400, to replace your boiler , pump, roof etc

Garden upkeep et mc

House insurance and repairs are not included and are paid for by the home owner when needed.

Yourself isit

Atlantic Dawn wrote: »

It's a cheap way for the council to not be involved in the maintenance costs of the estate, makes planning permission easier, provides a constant source of income for those living off the backs of others, it's the future.

Don't think anybody is making a huge profit of it.

colm_mcm

ted1 wrote: »

If you didn't pay you'd have the following costs.

House insurance 300 euro
Annual maintenance 200 euro
Sinking fund 400, to replace your boiler , pump, roof etc

Garden upkeep et mc

The management company really covers the above?

Yourself isit

Hollister11 wrote: »

House insurance and repairs are not included and are paid for by the home owner when needed.

That's your internal insurance. The common areas need insurance.

Atlantic Dawn

Yourself isit wrote: »

Don't think anybody is making a huge profit of it.

Councils are making a huge saving from it and they also take the property tax from them the same as an estate they control.

Yourself isit

colm_mcm wrote: »

The management company really covers the above?

I don't think the boiler unless it is shared. The roof for apartments, yes. That's covered.

Hollister11

Yourself isit wrote: »

Insurance, electricity, maintenance, painting, and a sinking fund (new law since 2011)

Certainly not home insurance, fair enough public liability. By electricity, do you mean street lighting. The houses have never been repainted by the management company in the 10 years of operation. In fact the entire estate could do with a pain, every house and apartment has all sorts of red/black colouring all over the properties.

I have never heard of a sinking fund. Would this include home repairs?

newacc2015

Atlantic Dawn wrote: »

It's a cheap way for the council to not be involved in the maintenance costs of the estate, makes planning permission easier, provides a constant source of income for those living off the backs of others, it's the future.

I agree with the council's though, they should not have to run for the maintenance of these estates. Most developments built in the 1930s/1960s are main roads that we all use. Most modern developments are not far off gated communities ie there is minimal public use, as most cars/people using the footpaths and roads are residents.

The absence of a proper property tax is a massive issues for councils. The token 0.17% that people pay for LPT is not an enough for all these new roads/footpaths, gardens etc for councils to maintain. The cost should be borne by the residents.

Yourself isit

Hollister11 wrote: »

Certainly not home insurance, fair enough public liability. By electricity, do you mean street lighting. The houses have never been repainted by the management company in the 10 years of operation. In fact the entire estate could do with a pain, every house and apartment has all sorts of red/black colouring all over the properties.

I have never heard of a sinking fund. Would this include home repairs?

The common areas in the apartment would have to be lit not sure about external lighting. I really only know the law for appartments but the sinking fund would handle external damage or roof damage there yes. If insurance didn't.

Atlantic Dawn

newacc2015 wrote: »

I agree with the council's though, they should not have to run for the maintenance of these estates. Most developments built in the 1930s/1960s are main roads that we all use. Most modern developments are not far off gated communities ie there is minimal public use, as most cars/people using the footpaths and roads are residents.

The absence of a proper property tax is a massive issues for councils. The token 0.17% that people pay for LPT is not an enough for all these new roads/footpaths, gardens etc for councils to maintain. The cost should be borne by the residents.

What then should LPT be used for? A multi million euro slush fund to look after ducks in the local estuary perhaps?

ted1

newacc2015 wrote: »

I agree with the council's though, they should not have to run for the maintenance of these estates. Most developments built in the 1930s/1960s are main roads that we all use. Most modern developments are not far off gated communities ie there is minimal public use, as most cars/people using the footpaths and roads are residents.

The absence of a proper property tax is a massive issues for councils. The token 0.17% that people pay for LPT is not an enough for all these new roads/footpaths, gardens etc for councils to maintain. The cost should be borne by the residents.

There are development levies to cover infrastructure

8850 per unit in DLRCoCo
http://www.dlrcoco.ie/en/planning/planning-fees-charges/development-contribution-schemes

dubrov

newacc2015 wrote: »

I agree with the council's though, they should not have to run for the maintenance of these estates. Most developments built in the 1930s/1960s are main roads that we all use. Most modern developments are not far off gated communities ie there is minimal public use, as most cars/people using the footpaths and roads are residents.

The absence of a proper property tax is a massive issues for councils. The token 0.17% that people pay for LPT is not an enough for all these new roads/footpaths, gardens etc for councils to maintain. The cost should be borne by the residents.

I disagree with most of the above.
Most new developments (in Dublin anyway) have very small common areas, certainly compared to developments in the 80s.
The buyers in these new development have to pay for the maintenance of the common areas as well as the maintenance of older estates (via taxes).
Either everyone should pay for maintenance of their own estates it should come out of a central pot.

It is also ridiculously inefficient to have a management company for each estate meaning there are costs for setting up the management company, preparing annual accounts etc. I'd imagine this might eat up about €200 of the OPs management fee

Mrs OBumble

Hollister11 wrote: »

EDIT: This is my parents property not mine. I live with them.

So why exactly do you think the details are your business?

Do you scrutinise their work contracts too?

Samuel T. Cogley

The management fee is a fee agreed by all the shareholders of the OMC. All a member needs to do is pitch up at the AGM and make their thoughts known; very, very few do. If a shareholder is being oppressed there is a body of company law, that I have completely forgotten, that allows them to seek relief.

tinkerbell

Your parents are members of the management company. It is THEIR company that are charging management fees. It is none of your business what the fees are used for since you are not a member! If your parents have an issue with the company of which they are part of, then they need to discuss it with other members at an AGM.

Yourself isit

Mrs OBumble wrote: »

So why exactly do you think the details are your business?

Do you scrutinise their work contracts too?

Presumably they might have asked him. Op you can be a proxy for your parents at the next AGM. They should have the details.

Hollister11

Mrs OBumble wrote: »

So why exactly do you think the details are your business?

Do you scrutinise their work contracts too?

Who do you think you are?

My parents share every details of income and expenses with me and my siblings. They always have since we were young teens. That was their way of teaching us the value of money and it shows us how hard our parents work for everything we have. So yes, it is my business.

Yourself isit

Hollister11 wrote: »

Who do you think you are?

My parents share every details of income and expenses with me and my siblings. They always have since we were young teens. That was their way of teaching us the value of money and it shows us how hard our parents work for everything we have. So yes, it is my business.

Well,then. Go to the AGM.

Hollister11

Yourself isit wrote: »

Well,then. Go to the AGM.

I plan too this year.

davo10

Op I live in a small development which has management fees and I was on themanagement committee for 10 years, thankfully I managed to persuade someone else to replace me a few years ago.

It was very common for us to recieve quite narky letters from owners about management fees, but all of these had one thing in common, they never showed up to AGMs so did not know how the fees were decided apon.

You/your parents are members of the management company, you have a right to attend MC meetings and for your opinion to be heard. Where a number of quotes have been recieved for a service like painting, gardening, refuse etc, a vote is taken on which provider to use, the cheapest isn't always the best.

Put simply, your questions would be answered at the AGM and you can forward a motion to change anything you are unhappy with. But if you don't attend, then you cannot complain about the decisions taken.

Incidentally, payment of MF's is part of the purchase contract and a property cannot be sold without confirmation from the MC that all fees are paid. The MC can apply for a lean on the property so that outstanding fees come out of sale price. We had to do this for two properties which were bought as rental units, even though they were always rented the owners didn't pay MF's. The MC got unpaid fees when properties sold.

The sinking fund was brought in in the MUD Act, it's a rainy day fund for repairs, unexpected outlays etc. Every managed development has to have one.

Paulw

ted1 wrote: »

If you didn't pay you'd have the following costs.

Actually, if you don't pay, you will end up in court and be forced to pay. It is very very seldom that an OMC wouldn't win a case and force payment.

Management fees are a legal obligation. You agree to pay them when you buy the property, by the contracts you sign.

Management company makes no profit. All fees gathered are used in the development. This is detailed in the set of accounts produced every year.

All unit owners are members of the management company. They get a set of accounts each year and are invited to the company AGM. There the management fees for the year are discussed and approved.

If you don't understand how a management company works, then it's time you did some research.

April 73

Hollister11 wrote: »

I live in a estate that was build just over 10 years ago. It's "managed" by a management company, and they charge €900 a year. I can't see where this is being spent, other then salaries for the suits. Bins are an extra €15 per week, and the security guard was let go. In fairness the fee was reduced by 200 when he was let go, but 900 seems like extortion.

EDIT: This is my parents property not mine. I live with them.

Going back to the original post - it's not clear what type of development or property this refers to.

If it's a fee for the management company to look after just the green areas (common in Meath & Kildare) then €900 seems a lot on the face of it.

If it's a multi-unit development with building maintenance & open spaces upkeep to fund, it's probably average.

The best way of understanding how the company is being run is by reading the accounts & attending the AGM.

"The suits" are generally unpaid directors who own property in the development & give their time for free to run the company. I was that mug for five years.

athtrasna

Mod note

Posters are reminded to remain civil at all times. A couple of posts in this thread are pushing the "don't be a dick" rule to its limit.

c montgomery

Op educate yourself as to the running of a management company before deciding to have a winge.

They don't make a profit, directors are unpaid and everything is accounted for and audited. They may be rogue ones out there but most are good.

Go to an agm and you might even be able to become a director yourself. It's a thankless job that takes up some of your free time and as you have clearly demonstrated is unappreciated.

Tea drinker

c montgomery wrote: »

Op educate yourself as to the running of a management company before deciding to have a winge.

They don't make a profit, directors are unpaid and everything is accounted for and audited. They may be rogue ones out there but most are good.

Go to an agm and you might even be able to become a director yourself. It's a thankless job that takes up some of your free time and as you have clearly demonstrated is unappreciated.

This. The most common issue with these funds is a low or non existent sinking fund. I think any "cowboys" taking people for a ride got outed post celtic tiger.