Flat without management company?

paulie2810

Hello,

I am looking to buy a flat early next year, but do not want to have to deal with a management agent as I know many people that have had awful experiences. I had thought that if I bought a Victorian conversion flat that there would be no management company as the upkeep of the building as a whole would just be down to the owners of the flats that make up the building.

Is this correct? Or will there always be a management company involved for any sort of flat?

Any help on this very much appreciated!! )

Fire_Fox

Welcome! Managing agent and management company are not one and the same, you are also confusing leasehold flats with ones where you own the leasehold AND a share in the freehold title. Some blocks are managed by the freeholder themselves, some are managed by an agent working on behalf of the freeholder, some by a group of leaseholders/ freeholders who form their own management company.

Victorian house conversions can be owned by the people who live in them so self managed, but they can also be owned by a freeholder who can be great or can be rubbish. Self managing is no guarantee of not having problems, neighbours can simply refuse to agree to or contribute to repairs often when they cannot afford it. Excellent website http://www.lease-advice.org/publications/

tonyh66

The management company is there to make sure everyone pays their share of the maintenance, you will probably find all flats in shared buildings have the same set up. Cosy little verbal agreements amongst the neighbours just doesn't work.

kmmr

Some conversions have management companies, some large blocks don't! So you have to find out each time. I don't think management companies are always terrible - it depends on each company.

You might want to look for share-of-freehold properties (sorry to use the term! I know some people here hate it, but it is the EA terminology). They tend to be more self managed, but that has it's own downfalls. I look after the accounts for my building, and the other flats seem to have therefore assumed I'm the building manager.

So the owners direct EA's to me if there are any issues, like leaks, etc - I had to politely tell them that when you save on management fees, it means you have to manage the issues yourselves.

kmmr

In my area lots of the Victorian conversion freeholds are owned by old family companies, or as investments. They often require you to use their managing companies at higher prices. It's case by case unfortunately - and in the end depends on the people you are dealing with.

missile

To my mind having a management company is the lesser of two evils. It can be a nightmare getting a.n.other residents to agree to share the cost of repairs to communal areas.

paulie2810

Thanks so much everyone for the very useful info! It's good to know that it's on a case by case basis and that I don't have to automatically discount flats in purpose built blocks. I guess my other thought with a conversion flat is that there would also be less communal areas to potentially have to pay out for maintenance.

I guess I'll have to wait and see if I can find a self-managed block/conversion when the time comes now!

propertyman

In the main a converted property costs far more to maintain. The smaller the building the greater the politics too, as people think in the same way as you as it is easier to control.

Until you disagree with someone just as assertive as you....


The trick...........

Look at the building, is it well maintained, what needs doing, look at the last three years accounts and budget and see how much and what money has been spent.

Fire_Fox

paulie2810 wrote: »

Thanks so much everyone for the very useful info! It's good to know that it's on a case by case basis and that I don't have to automatically discount flats in purpose built blocks. I guess my other thought with a conversion flat is that there would also be less communal areas to potentially have to pay out for maintenance.

I guess I'll have to wait and see if I can find a self-managed block/conversion when the time comes now!

Common parts are not necessarily expensive to maintain, consider choosing a place without heating in the common areas and without a lift as these can both cost big bucks. But with a larger block the cost of, say, repairing the roof is split between far more leaseholders - economy of scale can apply. This doesn't always work: my parents' self managed block is a huge converted mill and the economies of scale are cancelled out by the need for cherry pickers or scaffolding for even basic cleaning or repairs, and the fact the outside is listed.

Much of the rest is reading the long lease, reading the annual accounts, requesting copies of service contracts and invoices. Know exactly what you are paying for, know whether it is actually being done, formally (in writing) raise your concerns if not. The LEASE website is superb at telling you your rights in plain English. Many people have trouble with managing agents because they don't complain about the right issues or in the correct way, or start withholding service charges when they have no legal right to.

G_M

As others have explained, management companies can be good or bad.
As can Managing agents, or Freeholders, or individuals who share the freehold.

The important things to check, whatever the set up, are

1) is it expensive/good value? How much are service charges? Are any extra costs likely (ie if the property needs/will soon need major works like a new roof). Is there a sink fund (money set aside over previous years to cover futyre major costs). What do you get for your service charge(eg swimming pool, lift, cleaner for common areas etc)

2) is it efficiently run? Do the accounts make sense and look reasonable/ Are they up to date? Are all leaseholders contributing their service charges regularly and/or being chased?

The two ways to check the above are

1) ask for the accounts etc. This a standard part of a conveyancer's job and he'll request these as part of the buying process

2) speak to the neighbours/other people in the building. Ignore let properties with tenants (though they can tell you about noise, how regularly the window cleaner / whatever comes), but other leaseholders who've lived there a while will know if the building is well-managed or if there are issues.

paulie2810

I never realised there would be quite so much involved! The naïvety of a first time buyer I guess!

Checking out if there is a sink fund will be very useful, as will looking at accounts and past work and talking to other building residents.

We're looking at buying a small flat to get us on to the property ladder and taking advantage of the low interest rates to save like crazy for a couple of years so we can then buy a house. So I guess if there's just been a load of work done recently then there's a good chance that (hopefully!) there shouldn't be too much needed in the 2.5 years that we're there.

Also a very useful point regarding communal heating and lifts etc, thanks Fire Fox. It's not something I would ever have thought of I don't think!