Ground Rent and Service Charge

stringsmk2

We pay about 125 pcm for our service charge, though 50 of that is a capital improvement fund. The rates you sight above seem fair, and while you dont see what they do behind the scenes, they do alot and it is the little things that add up in the end.
I am a director for a residents group which represents all the lease holders for the block of flat, we employ Crabtree and we have found them to be pretty good, albeit slightly expensive.

Our ground rent is 125 per year

Richard_Webster

Also, does anyone agree with ..... the ground rent of £250 / year

If that's in the lease that's what you pay. Your solicitor would have told you this. It is not a question of agreeing whether it is reasonable or not - you bought the flat and presumably the lease says that is the amount of the ground rent - so if you didn't like it you shouldn't have bought the flat.

adriandilly

Richard_Webster wrote: »

If that's in the lease that's what you pay. Your solicitor would have told you this. It is not a question of agreeing whether it is reasonable or not - you bought the flat and presumably the lease says that is the amount of the ground rent - so if you didn't like it you shouldn't have bought the flat.

Actually the lease documents said that ground rent had yet to have been decided....
Only now, 20 months in, have we discovered the figure and have to pay 3 lots worth

Richard_Webster

Quote:
Originally Posted by Richard Webster
If that's in the lease that's what you pay. Your solicitor would have told you this. It is not a question of agreeing whether it is reasonable or not - you bought the flat and presumably the lease says that is the amount of the ground rent - so if you didn't like it you shouldn't have bought the flat.
Actually the lease documents said that ground rent had yet to have been decided....
Only now, 20 months in, have we discovered the figure and have to pay 3 lots worth

How was it to be decided? There must have been some formula in the lease?

G_M

adriandilly wrote: »

Actually the lease documents said that ground rent had yet to have been decided....
Only now, 20 months in, have we discovered the figure and have to pay 3 lots worth

I had this with my new washing machine. There was no price on it in the shop but I agreed to buy it. The shop delivered and then decided how much to charge me. I got a bill for £2500....

Sorry - that's not how things work.

sonastin

You've got 3 separate "management fees" on the list. What do they pay. I would have assumed it was to cover the costs and overheads of the management company but a lot of these overheads (e.g. D&O insurance, company secretary fees, audit fees, etc) are being charged for separately as well. And what are "health and safety costs"?!

I would ask for a copy of the accounts - particularly if you are contributing to a sink fund for major works. I would want to keep track of how much was in the "non annual expenditure" fund each year.

mr_wicket

The law has recently changed that management companies are no longer required to provide landlords with an annual ALM (annual landlord meeting) where account records for the financial year are provided and any questions are answered, but I am sure they will be willing to answer any q's you may have. I pay around £60 a month service charge for a 2 bed flat in middlesex/n.west london area,

ILW

adriandilly wrote: »

Actually the lease documents said that ground rent had yet to have been decided....
Only now, 20 months in, have we discovered the figure and have to pay 3 lots worth

And you and your solicitor agreed to that?

That is like writing someone a blank cheque.

Your lucky it's only £250 pa.

adriandilly

Sorry, my wife has just found a letter from our solicitor confirming the Ground Rent amount of £250 p.a. sent around completion last year. There have been so many documents to wade through

patman99

So, there are a total of 60 properties on the development. It is unusual that you are all paying different service charge amounts.
I would suggest with great urgentcy that you get together with you nieghbours and form a residents committee with a view to purchasing the freehold from Bellway. Once done, the committee can then set-about engaging another M/C. Be aware though that most charge a 'per property' fee, whilst the better ones charge a percentage commission.
Whatever happens, you should end-up paying a 1/60th share of the total service charge.

FYI, I live in a development of 30 dwellings, we have our own R/A who deal with the M/C. The R/A also holds AGMs to elect directors and set the S/C. Our S/C is £60 p/m. When we first took control of the site, the S/C was £20 p/m, and that was 19 years ago. So it just goes to show that with good in-house management + a good M/C can work wonders.