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126% Service Charge increase!!! Really?!

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  • HPG1
    HPG1 Posts: 11 Forumite
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    The service charge for 2016-2017 and prior does not provide much in terms of a breakdown of costs.

    I think you're right, this is an attempt to get some more cash.
  • getmore4less
    getmore4less Posts: 46,882 Forumite
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    If the previous years have been £700 per flat there is not a lot to breakdown

    Did it change when the landlord change from doing it themselves to Circle?

    Do they(circle/landlord) know you know each other

    Sneaky timing between owners, your vendor won't care and they hope you don't notice.

    Your vendor should have had the same letter have they passed it on yet.
  • rtho782
    rtho782 Posts: 1,189 Forumite
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    If there are 2 flats and you and your boyfriend own the both of them between you, can you not take over management or buy the freehold?
  • HPG1
    HPG1 Posts: 11 Forumite
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    Yes, the breakdown was introduced when Circle Management was instructed.

    They have no idea that we know each other.

    Good point re. my vendor as he hasn't passed anything on. Issue with him is that he owes for previous years service charge and ground rent....

    I think the right to manage route is best option.

    Does anyone have much experience with the process? I have started to get comparable quotes.

    Thanks!
  • AlexMac
    AlexMac Posts: 2,994 Forumite
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    This is the reason I only ever buy "Shared Freehold " flats; to avoid the situation where an absent (non-resident) freeholder owns the freehold for the sole purpose of making money.

    But it might be more naive than that; you seem to be describing a building where there are only two flats? In presumably a converted house? But while you finger "Circle" as the exploitative managing agent, and correctly say you will have the automatic Right to Manage once you both own the whole block (...?) you do not say who the existing freeholder is?

    Maybe they are just daft... or maybe the problem is

    Because they will have appointed the Managing Agent who is inventing huge service charges; unless Circle are both the Freeholder and the Manging Agent?

    Either way- if you make life difficult for the Agent by constantly challenging their bills until you take over RTM they may back off, and if you also keep giving the freeholder aggro, they may well sell it to you? But remember, these people are only in it for profit, so don't play soft .
    And take legal advice from your current conveyancing solicitor, or, if they are !!!!!!s, a more agressive solicitor.

    Along the way, pull them up on everything they fall down on; e.g have they done the asbestos surveys on any communal areas?

    And then, when you own the freehold, cost uo wheter it's worth converting back into ahouse; sometimes two flats are worth less than a classic 3-bed house! Sometimes not.

    You'll sort it out- you obviously have the "right stuff"
  • HPG1
    HPG1 Posts: 11 Forumite
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    Thank you Alex Mac!
    Very much appreciate your response.

    You've hit the nail on the head; two flats in a converted house. The freeholder is not Circle but they have been instructed to manage the services. He owns the freehold and manages the services for a number of properties so I suspect he now wants an easier life (?!) My boyfriend has probably been a pain but he questions everything!! Rightly so.

    I feel comfortable going ahead with the right to manage and perhaps the freehold (further down the line!)

    Solicitor is on the case and I am gathering evidence relating to the inflated service charges.
  • HampshireH
    HampshireH Posts: 4,488 Forumite
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    Does his service charge apply to an estate rather than the block. I cannot see where they could charge for health & safety or maintenance if there are no communal gardens/areas and no work has been done. Unless the area being catered for is wider than just the 2 flats.

    Presumably the leaseholder would be responsible for any H&S issues which arose within the respective flats.

    Also be interesting to know what they were surveying for.

    Probably doesn't help you for that I apologise. Just seems excessive
  • getmore4less
    getmore4less Posts: 46,882 Forumite
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    HPG1 wrote: »
    Yes, the breakdown was introduced when Circle Management was instructed.

    They have no idea that we know each other.

    Good point re. my vendor as he hasn't passed anything on. Issue with him is that he owes for previous years service charge and ground rent....

    I think the right to manage route is best option.

    Does anyone have much experience with the process? I have started to get comparable quotes.

    Thanks!

    Looks like the vendor may be no use, unless keen to sell and not introduce delays.

    Not sure if it best to stay anon for now, as once they catch on they will treat any information from either of you as they were dealing with a single entity and will know for sure they are going to lose the contract.

    Remember for now you don't know from an official source(your vendor) about the charges.



    not sure how this works legally but if they have said
    "Is any increase in the Service Charge over 10% or £100, whichever is the greater, anticipated in the next 2 years?'

    "Within the next 2 years, are any Section 20 works proposed to the Property"

    Landlord ticked No to both questions, it is signed and dated 21st July 2017. Service Charge is confirmed as £700 per year, Ground Rent is £250 per year.

    when can they up the charges?
    how long would that info be valid?

    Maybe your solicitor should be asking for an update as it is nearly 6 months old.

    if the landlord still says the same as they don't know what circle are doing what happens then.
  • AlexMac
    AlexMac Posts: 2,994 Forumite
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    De Nada HPG1; but having re-read my post, I an amused to see that my flippant use of the word for baby cats when describing a timid solicitor, in #16. above, has offended the MSE profanity checker? Hush my mouth!
  • HPG1
    HPG1 Posts: 11 Forumite
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    Hi all, apologies for not checking in sooner, this week has been quite eventful for all the wrong reasons (this isn't the best place thread to rant about e.on!)

    Still gathering quotes and will give an update when I get a couple more. BF has spoken to Freeholder who simply does not want manage the property any longer nor does he give a crap about the charges. No mention of myself in that convoy BTW.

    Vendor hasn't said a word but he is keen to sell as the property is empty.

    Increase will take affect from next week.

    Not sure if I should flag this with my solicitor now as all the info I have so far is not from the vendor. I could ask regarding 2018 rates in general as the info I have is from July. I have the deeds but I'm not going to sign and transfer funds etc. during Christmas week. The flat needs work which isnt going happen over Xmas etc irrespective of the management company drama.

    My friend (solicitor in training) is helping us with the process which is good!

    On another note, how do I reply to individual posts so it shows the message in orange first? Not sure if I'm making sense!!
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