€60 per month in management fees?!

dco90

Hey,

My partner and I recently went sale agreed on a house in a 12 y.o development in Wicklow. It's a small enough estate with 13 houses and the house cost €250,000.

The main thing bothering us is the management fee of €60 per month (€720 per year). This covers the group water and sewage scheme, which comprises a well and treatment system, but after that there's just the small green area and a few lampposts.

It seems an awful lot of money for such a small estate and our solicitor agrees that it may be something we will have to fight going forward.

I was just wondering if this seems like a lot for the area in which we are buying. Secondly, I was wondering what the process is to have the estate taken in charge by the country council.

Finally, I wanted to know if anyone has a similar situation that they'd like to share - along with solutions obviously!

road_high

I pay similar in a small estate in Kilkenny. Pays for upkeep of the estate (it’s kept very well in fairness), painting, and you dont get parking permits if you don’t pay it! Sounds pretty standard to me, can be a lot more in Dublin. Ultimately your decision but they’re clear before you buy that’s there’s a fee

fritzelly

Did you not know the fee before going sale agreed? Seems a strange thing to be haggling over after buying a 250k house
The council are not going to take on the cost of the private well/sewerage system so you will still have to pay for it
https://www.citizensinformation.ie/en/environment/water_services/water_supply.html

Remember the fees are not just for ongoing running charges but for when things go wrong as well

dubrov

It is very annoying as you may find an estate around the corner where the council take care of all these things.

720 is very high for a house management fee, even for Dublin. However Dublin management fees don't normally cover water and sewerage but would might cover bins.

If it is to high for what you get, potentially you could get the residents to vote to move to a different management company and/or maintenance contract. This is unlikely though and I wouldn't bank on it happening.

Best to just factor it into the price you are willing to pay. I'd be thinking of knocking off 15-20k.

drunkmonkey

Ask is there a discount for paying in advance. I think the sticker price of the management fees in one place I know are around €700 but if you pay upfront there about €320.
Don't ask the estate agents go ask the property company yourself, pick up the phone don't email.
I'd say there's no hope of a discount on the house as that's something that should have been asked before bidding.

kippy

Has your solicitor done the due diligence on the management companies accounts and governance yet?
Management fees are common enough unfortunately however the key thing to look out for are the state of the accounts and payment compliance.
Also. There are many things that can go wrong with wells and sewage treatment plants what Ch can be costly. Are there enough funds there to cover these issues?
Getting the council to take some of these estates in charge is neigh on impossible.

I've lived in a similar sized estate in Galway with a similar management fee which covered maintenance of green area, electric gates external painting ànd a few other small things..estate was kept well but the council wouldn't touch it so don't ever rely on that happening. ie assume you will need to pay that fee and more well into the future.

Dav010

Op, I was a director of the MC where I lived for a number of years. Without doubt the most frustrating aspect of it was handling complaints from owners about the fees. Without exception they tended to be from people who didn’t attend AGMs so did not know how much it cost to maintain the development.

Insurance is one of the costs you missed. You can ask your MC for the minutes of their las AGM, this will contain the breakdown of MC costs for the coming year and the fee. You can check when the next AGM is, they are usually early in the year so it may be coming up soon.

godtabh

getting the estate taken in charge is simple enough. Get as built drawings produced. Get engineer/architect sign off. Engage with the council. Goes on public display and councilors vote on it to take it in charge or not.

Process can take any ware from a couple of months (4 months is the quickest I've seen it, other is still going 2 years later!). Costs can range from a couple of hundred euro for an as built survey to hundreds or thousands of euros if remedial work is required.

L1011

godtabh wrote: »

getting the estate taken in charge is simple enough. Get as built drawings produced. Get engineer/architect sign off. Engage with the council. Goes on public display and councilors vote on it to take it in charge or not.

Process can take any ware from a couple of months (4 months is the quickest I've seen it, other is still going 2 years later!). Costs can range from a couple of hundred euro for an as built survey to hundreds or thousands of euros if remedial work is required.

That's the normal procedure when there's mains water services. Here the council are likely to have significantly more issues with it beyond the thousands of euro range

amadangomor

Dav010 wrote: »

Op, I was a director of the MC where I lived for a number of years. Without doubt the most frustrating aspect of it was handling complaints from owners about the fees. Without exception they tended to be from people who didn’t attend AGMs so did not know how much it cost to maintain the development.

Insurance is one of the costs you missed. You can ask your MC for the minutes of their las AGM, this will contain the breakdown of MC costs for the coming year and the fee. You can check when the next AGM is, they are usually early in the year so it may be coming up soon.

Surely insurance on individual houses would be paid by the individual owners. Are you talking about insurance for the garden areas/sewage treatment?

OP -why is the estate not connected to the public water supply/sewage system? Too remote?

sydthebeat

L1011 wrote: »

That's the normal procedure when there's mains water services. Here the council are likely to have significantly more issues with it beyond the thousands of euro range

And there's no guarantee that the council will up keep the estate to the same quality and diligence as the maintenance company.

As it has its own water treatment AND sewage treatment, the council will want to keep as far away from taking that estate in as possible, so don't expect them to be at all helpful or cooperative

Dav010

amadangomor wrote: »

Surely insurance on individual houses would be paid by the individual owners. Are you talking about insurance for the garden areas/sewage treatment?

OP -why is the estate not connected to the public water supply/sewage system? Too remote?

Yes, insurance/public liability for estate. I have never known insurance costs to decrease year on year. Also, electric costs/maintenance of street lighting in estates is more expensive than domestic rates, those lights are on sensors which means they are on a lot during the long evenings, less during the summer. Paying someone to maintain common areas is also a fee which rarely decreases. If the estate has its own well, the equipment has to be paid for/serviced/probably repaired occasionally. So the op needs to attend an AGM to find out what the costs are.

Mantis Toboggan

€720 seems excessive, we don't pay anything where we live and everything gets taken care of.

Dav010

Mantis Toboggan wrote: »

€720 seems excessive, we don't pay anything where we live and everything gets taken care of.

Taken care of by who?

I’m not sure that you can say it is excessive without first seeing what the associated costs are for the estate. There may be some costs in the ops estate which are not in others, also, there are a small number of units to cover all costs.

dubrov

It may not be excessive but is unfair. Everyone pays taxes but yet some estates have to pay for their own lighting/insurance/sewerage and others get it for free.

pwurple

dubrov wrote: »

It may not be excessive but is unfair. Everyone pays taxes but yet some estates have to pay for their own lighting/insurance/sewerage and others get it for free.

If we are talking about fairness, that's clearly buyer beware on buying in an unserviced housing estate. You can't just rock up on effectively your own disconnected island, build a house and then throw the hands up and say SERVICE ME for FREE! The infrastructure cost is absolutely enormous.

I'd question building this in the first place, let alone buying one.

dubrov

All new housing estates in Dublin (and probably country wide) have this issue.
So you could have two housing estates side by side requiring the same services but the newer one has management fees while the older one is looked after by the council.

The councils obviously look at it as a way to push costs onto new homeowners.
When you include administration costs of these management companies, it is really a dreadful waste and unfair to boot.

OP, just factor it in to your purchase decision. It is very unlikely it will change.

dco90

dco90 wrote: »

..........our solicitor agrees that it may be something we will have to fight going forward.

................

You've bought it?
What grounds do you have for fighting it going forward?

enricoh

There's only 13 houses in the estate, imo you will be getting off to a bad start with your neighbours by kicking up a fuss.
Most management fees around me would be half yours but none have sewage n group water.
It's reasonable enough taking sewage and water into account.

Dav010

Augeo wrote: »

You've bought it?
What grounds do you have for fighting it going forward?

That is a very strange comment by the ops solicitor, Section 18(10) of the Multi-Unit Developments Act 2011 places an obligation on an owner to pay management fees. I don’t know what he/she means by “fighting” it.

charlietheminxx

dubrov wrote: »

All new housing estates in Dublin (and probably country wide) have this issue.
So you could have two housing estates side by side requiring the same services but the newer one has management fees while the older one is looked after by the council.

I've seen this said a fair bit, and I know it was the norm for a while but I don't think it's the case for a lot of new builds now. There's none for my estate (which has been built in stages since 2014) or for the estate of new builds where my friend has bought (launched last year) - both in North County Dublin.

That being said, we were aware of how common this is when we were looking at houses and would have factored the ongoing cost in. Doesn't seem like you can do much about it now OP.

Mantis Toboggan

Dav010 wrote: »

Taken care of by who?.

The county council.

kippy

Your solicitor sounds like they haven't a clue. Which is worrying.

Caranica

Dav010 wrote: »

That is a very strange comment by the ops solicitor, Section 18(10) of the Multi-Unit Developments Act 2011 places an obligation on an owner to pay management fees. I don’t know what he/she means by “fighting” it.

I've seen it happen in relation to rules like no satellite dishes. People don't agree, buy anyway and then demand to be able to put up a dish (or just put one up anyway). If you don't like the fees/rules buy elsewhere.

Caranica

I presume OP's solicitor meant he can challenge the management company on the fees going forward if he chooses to, when he's living there. Not that he will challenge the seller of the house over them.


Do management fees carry over to new owners? (I know in some countries, like Spain for example, if you don't pay your fees, then the next owner is liable for them - just make sure that isn't the case here, OP!).

Caranica wrote: »

I've seen it happen in relation to rules like no satellite dishes. People don't agree, buy anyway and then demand to be able to put up a dish (or just put one up anyway). If you don't like the fees/rules buy elsewhere.

That's a silly rule, though, in fairness.

dco90

Hey all, OP here

Thanks for all of your input.

To clarify a few things:

1. We were aware of the management fees at the time of offer. We thought that it was an error in the advertisement, but decided it was better to start the buying process while waiting for clarification. Now that we have signed our contacts, we have decided that it is an expense with which we can learn to live, but considering that we stand to lose almost €10,000 in the first 12 years of living there, I said I'd look into getting it taken over by the council so as to save this money

2. We have EVERY intention of paying our management fees; although they may be high and although I don't understand the budget fully, I will still respect them, as we are legally obliged to. As regards 'fighting for' the manager fees, our solicitor meant that we would struggle to get the management taken over by the council and that it may not be worth it in the end, but at no point did he advise us to outright not pay them.

3. Our estate is remote, about ten minutes drive from the nearest town.

4. The management fees are inclusive of a group water and sewage scheme. Given that it's a 12 y.o. estate, I'd imagine that the possibility of something going wrong with either system would be quite high, as would the associated repair costs.

From what I can tell, this is a real caveat emptor, and I guess we'll just have to learn to live with it. It seems that getting the estate taken over may not even be possible, let alone a simple case of filing out a form.

As it stands, we intend to move in ASAP and pay our fees for the next 12 months. Once we have gotten to know our neighbors and found out more about the fees, we can make a decision regarding taking in charge by the council.

A LOT of mixed reactions on this thread regarding management fees; I hope you all can understand why I need advice !!

theteal

charlietheminxx wrote: »

I've seen this said a fair bit, and I know it was the norm for a while but I don't think it's the case for a lot of new builds now. There's none for my estate (which has been built in stages since 2014) or for the estate of new builds where my friend has bought (launched last year) - both in North County Dublin.

That being said, we were aware of how common this is when we were looking at houses and would have factored the ongoing cost in. Doesn't seem like you can do much about it now OP.

The brother moved into his new build late last year, more or less on the Royal Canal, fees are more than the OP is paying iirc but that does include gym and "front garden" tended to. Still very much the norm afaik.

OP, I would assume the fact that there are so few houses would contribute to what could be seen as a high amount. Anyway, you're only sale agreed, if it's a proper issue, walk away and let the seller get a deal done with someone else.

Also, just to help you feel better, I live in the UK. Council Tax is over £1800 per annum, water is £17.50 per month and sewage is about the same.

kippy

dco90 wrote: »

Hey all, OP here

Thanks for all of your input.

To clarify a few things:

1. We were aware of the management fees at the time of offer. We thought that it was an error in the advertisement, but decided it was better to start the buying process while waiting for clarification. Now that we have signed our contacts, we have decided that it is an expense with which we can learn to live, but considering that we stand to lose almost €10,000 in the first 12 years of living there, I said I'd look into getting it taken over by the council so as to save this money

2. We have EVERY intention of paying our management fees; although they may be high and although I don't understand the budget fully, I will still respect them, as we are legally obliged to. As regards 'fighting for' the manager fees, our solicitor meant that we would struggle to get the management taken over by the council and that it may not be worth it in the end, but at no point did he advise us to outright not pay them.

3. Our estate is remote, about ten minutes drive from the nearest town.

4. The management fees are inclusive of a group water and sewage scheme. Given that it's a 12 y.o. estate, I'd imagine that the possibility of something going wrong with either system would be quite high, as would the associated repair costs.

From what I can tell, this is a real caveat emptor, and I guess we'll just have to learn to live with it. It seems that getting the estate taken over may not even be possible, let alone a simple case of filing out a form.

As it stands, we intend to move in ASAP and pay our fees for the next 12 months. Once we have gotten to know our neighbors and found out more about the fees, we can make a decision regarding taking in charge by the council.

A LOT of mixed reactions on this thread regarding management fees; I hope you all can understand why I need advice !!

The issues with the council taking them in charge are down to a few or a combination of a few things:
-If the estate was not finished to the standard agreed between the developer and the local authority at the time.
-Whether the builder who did the estate had all the paperwork in order.
-Whether the builder is still a going concern (it's not at all likely any issues with the first two points above can be sorted if the builder is no longer operating) which I think is the case for a lot of houses built around the time your's was.
-The lack of drive by the management agent to get the estate handed over (else they lose their annual fee and any other income)
-The difficulty in getting a few people together to organise themselves to be able to do what you have just started the process of doing.

The issue a lot of people have with management fees now is that people paying these fees also have to pay the property tax to the fees.

On top of all that you'll find that there are plenty people with opinions and ideas but very few who end up going to any of the management company meetings.

The key thing is that the management company has funds to operate and to cover any of the issues that might occur.

I'd add, it would be unlikely the council would ever take it over without it being conneted to a mains sewer - that would be your first challange.

jimmycrackcorm

Op you will become part of the MC of which there are going to be 13 members. As such you'll have an opportunity to examine or change the fees and what they are allocated against.

Dav010

[Deleted User] wrote: »

Do management fees carry over to new owners?

Before a property can be sold, the seller needs a letter from the MC stating everything is paid up to date, without it, the buyers solicitor will not move forward with the purchase unless the buyer instructs their own solicitor that they will take responsibility for outstanding fees. This rarely if ever happens so responsibility for outstanding fees does not carry over.

Op, A MC is required under the MUD Act, so MC fees are not discretionary. No MC sets out to charge high fees, the fees have to be discussed at an AGM and voted on. If you dispute the costs, say so at an AGM, but if you do not attend, then don’t complain to the Directors.

MrMusician18

dubrov wrote: »

It may not be excessive but is unfair. Everyone pays taxes but yet some estates have to pay for their own lighting/insurance/sewerage and others get it for free.

Shouldn't people be blaming the developer for not building to the standard the council require?