Totally Phenomenal Service charge?

Kuztardd

How much is too much for a service charge??..

We went to look at a property today, and totaly fell in love.. Inside is perfect, immaculate, newly done etc etc.. its loverly..
It is also share of freehold.. which is good.

BUT, the service charge is £2,000 a YEAR! yes, that is the correct amount of 0's.

There will be 1 year of work being carried out on the exterior of the block of Art deco flats. so im guessing that is why the huge fee..
do you reckon this would be temporary? EA was unable to answer straight away.

Apparently the seller will pay for 3 years of service charge/ground rent for whomever buys the flat. Is this ever heard of? Even the EA was astounded and was going to get clarification.

Also the flats (art eco style, 1930's) have flat roofs, does house insurance become really expensive on flat roofs?

Cheers me dears

lewt

i pay £65 a month incucling water. and get abiut the water rates and thats it.

Curious_Moose

Ask about the state of the sinking fund. How much money do they have in the communal kitty.

cattie

Flat roofs are more expensive to maintain than a conventional pitched & tiled roof. They not only need a lot more maintance, but have a much shorter lifespan than conventional roofs. For this reason I would imagine insurance would be a little more expensive.

Also bear in mind a 30's block may have to have windows & doors specially made if it wishes to retain some authenticity in appearance when updating is necessary & this will cost more than run of the mill frames.

As the flat is share of freehold then the management commitee should have some voice in who gets the contract for the works, unlike many leasehold flats where the managing agents have control & the charges for works & labour can be staggering.

If the flat is in London then £2000 isn't absolutely ott for service charges. I say this because I've been investigating some local flats on the market over the past few months & while the average service charge seems to be around £1200-£1500 for well kept blocks, I have had details of 2 flats with service charges of £1800 & £2000 respectively.

Kuztardd

luckily the windows in the property are new double glazed (other in the block are still old style metal type) so its not a worry for us.

i still feel that 2k is huge, but i dont know the london averages and house buying is new to me.
it is on a property worth under £240,000, and doesn't have anything like specialist parking/concierge/elaborate gardens etc etc (which is what i guess pumps up costs)

cattie, those prices you mentioned, what kind/type/price range of properties were they for?

BobProperty

I know of a large block of flats in Balham where the heating is included in the service charge, so in that case £2000 isn't out of order.

prudryden

I wonder if he is offering to pay 3 years service charge because the one year outside work is going to be charged separately. Is that possible?

Kuztardd

Apparently it will be all included in the service charge, and not seperatly.. I will be asking the EA for clarification though.

Im guessing things like that get picked up in a survey, and solictors bits/pieces wouldn't they?

A similar flat did sell for around £15,000 less recently, although it may not have been as beautiful refurbished inside like this one has..
maybe the seller thinks he will tempt more people to buy if he pays the £2k a year, but this is also shown in the increased asking price.

Even the EA said that it would be best to start an offer at £15k below asking price in reflection of the other property prices.

Sybarite

Guarantee that the 2k is service charge only and not unusual. Nothing to do with the exterior work being carried out - very important you find out the likely cost of this in advance - there has been recent publicity regarding the purchase of ex-council properties whose new owners are now being landed with very heft bills for maintenance (possibly why the owner is stumping up for 3yrs SC).

Last guy I knew with this sort of charge was £1800 PA and absolutely nothing was done for it - I mean diddly-squat - not a communal window was cleaned, no communal garden, etc. I think a new yale lock may have been fitted on the communal front door after a break-in. Other than that nearly 2k for a few light bulbs left on the corridors.