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Expenses likely to be shown in the service charge accounts in the next three years
Tirian
Posts: 996 Forumite
We've finally received an offer on our flat, busy steaming through all the forms from our estate agent. One of the questions is :
Does the seller know of any expenses (e.g. the cost of redecoration of outside or communal areas not usually incurred annually) likely to be shown in the service charge accounts within the next three years? If Yes, please give details
We have a letter from the landlord, sent to us in April which notes costs incurred to date in relation to external decorations, with our share given as around £1500. It states that this is not a demand for payment and no money is due until we receive an invoice (which has not yet happened).
First of all, I presume that this is the kind of thing they are referring to so I intend to enclose a copy with the form.
My question is, what is the usual practice in these circumstances when it comes to the sale? Is the seller likely to ask that we knock this off the price? If so, how much leeway is there on this usually? We're keen to sell, but having already substantially reduced the asking price, would not be especially eager stump up extras. Especially for something we're not going to experience the benefit of ..
Does the seller know of any expenses (e.g. the cost of redecoration of outside or communal areas not usually incurred annually) likely to be shown in the service charge accounts within the next three years? If Yes, please give details
We have a letter from the landlord, sent to us in April which notes costs incurred to date in relation to external decorations, with our share given as around £1500. It states that this is not a demand for payment and no money is due until we receive an invoice (which has not yet happened).
First of all, I presume that this is the kind of thing they are referring to so I intend to enclose a copy with the form.
My question is, what is the usual practice in these circumstances when it comes to the sale? Is the seller likely to ask that we knock this off the price? If so, how much leeway is there on this usually? We're keen to sell, but having already substantially reduced the asking price, would not be especially eager stump up extras. Especially for something we're not going to experience the benefit of ..
For where your treasure is, there will your heart be also ...
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Comments
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Yes.First of all, I presume that this is the kind of thing they are referring to so I intend to enclose a copy with the form.
I assume you mean the buyer. It's possible, in which case as with all price negotiation it's a game of bluff. If you refuse to give way, will you lose the buyer and if so are you willing to? On the other hand, is the buyer willing to lose the property if HE refuses to give way.Is the seller likely to ask that we knock this off the price? If so, how much leeway is there on this usually?
ps - why are you getting this enquiry from your EA? Nothing to do with him!0 -
The cost is normally negotated between the buyer and seller. It could be split 50/50 if your buyer is up for it?0
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What hasn't been disclosed is whether there's any surplus in the service-charge accounts, like a sinking-fund of monies which has been set aside for major expenses like external redecoration.0
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Additionaly it might be worth to open negotations early because your buyer's lawyer will receive a copy of the section 20 notice and it won't be a nice suprise for them.0
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I do of course mean buyer ... I'd personally be minded to go for 50/50 on it. I appreciate it's not a "nice surprise" ... but then again, it wasn't a nice surprise for us either. That's part of the joy of owning a leasehold property.
Would the buyer pass up on the property on the basis of this upcoming charge? No idea ... who could know? Given it's less than 1% the value of the property, I'd guess most likely not.
Would we pass up the sale? Ambivalent ... yes we'd love to sell. On the other hand we can cover the mortgage and have a substantial surplus if we rented out commercially (it's rented to a friend at the moment). So we're not desperate. But again, it's less than 1% ... hence 50/50 seems a reasonable compromise to me.
I think for the moment I'll just fill in the facts, and see what we hear back, and go from there.For where your treasure is, there will your heart be also ...0 -
BitterAndTwisted wrote: »What hasn't been disclosed is whether there's any surplus in the service-charge accounts, like a sinking-fund of monies which has been set aside for major expenses like external redecoration.
Don't think so - I certainly haven't seen anything to that effect, but it's a good point. I'll call the landlord and query that.For where your treasure is, there will your heart be also ...0 -
Yes.
I assume you mean the buyer. It's possible, in which case as with all price negotiation it's a game of bluff. If you refuse to give way, will you lose the buyer and if so are you willing to? On the other hand, is the buyer willing to lose the property if HE refuses to give way.
ps - why are you getting this enquiry from your EA? Nothing to do with him!
Um, yeah .. fingers disengaged from brain. Forms are from the solicitor, not the EA.For where your treasure is, there will your heart be also ...0 -
Don't think so - I certainly haven't seen anything to that effect (sinking-fund), but it's a good point. I'll call the landlord and query that.
How long have you owned this property and have you ever seen the annual accounts? The presence of a sinking-fund, if there is one, will be mentioned.0 -
upcoming major works should deffo be notified, and arrange share of the costs as part of purchase price- along with any 'year end' surcharge for the general upkeep..Long time away from MSE, been dealing real life stuff..
Sometimes seen lurking on the compers forum :-)0 -
Yes, seen annual accounts (enclosing copy with the solicitors forms in fact). No sign of a sinking fund.
However last year the service charge was below the estimate, so we got a credit at the end of the year :-)For where your treasure is, there will your heart be also ...0
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