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Estate Agent Con Trick

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Comments

  • G_M
    G_M Posts: 51,977 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    I am currently in the process of purchasing a lease hold flat, ..... the estate agent has advertised the service charge for the flat at 900 per annum. however, my solicitor has noted the current owner pays £150 A MONTH. is it normal for estate agents to use con tactics on adverts?
    What makes you think it's a con?

    EA: "how much do you pay for the service charge?"
    Seller: "I can't remember exactly. about £900 a year I think?"

    so EA puts £900 pa in the marketing.

    It's all all subject to confirmation during the conveyancing - and that's what your solicior has done.
  • boliston
    boliston Posts: 3,012 Forumite
    Part of the Furniture 1,000 Posts Photogenic Combo Breaker
    ognum wrote: »
    I own several flats and many of the service charge bills are actually three monthly, this is written into the property leases.

    I think £1800 is a lot but of course it depends on the age of he property and the length of lease ad if ground rent is included though I prefer flats with no ground rent and if negotiating a new lease will never accept leases with escalating ground rents.

    Believe the lawyer!

    Surely most ground rents are inflation linked - mine certainly is but with the benefit that it is only reviewed every 25 years rather than yearly like normal rent
  • ognum
    ognum Posts: 4,879 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    boliston wrote: »
    Surely most ground rents are inflation linked - mine certainly is but with the benefit that it is only reviewed every 25 years rather than yearly like normal rent

    I don't know about most, where do you get that information from. I own faults with peppercorn rents (nothing, never increase) and share of the freehold ( nothing, never increase) and fixed ground rents (£15 a year, never increase)

    Buyers should be more aware of what they are buying or maybe it's just me and I'm lucky!
  • bouicca21
    bouicca21 Posts: 6,703 Forumite
    Part of the Furniture 1,000 Posts Name Dropper
    You need to find out what the £150 a month covers - is it just service charge or does it include ground rent?

    A lot will depend only the type of property. The biggest single item in my service charge is insurance and the cost of insurance will obviously vary according to age and type of structure.

    Is there a sinking fund? Is it on one of these modern estates where the service charge includes maintaining the communal roads and spaces?

    Why is it paid monthly? What service do the leaseholders actually get?
  • Old_Git
    Old_Git Posts: 4,751 Forumite
    Part of the Furniture 1,000 Posts Mortgage-free Glee! Cashback Cashier
    I am currently in the process of purchasing a lease hold flat, management company- living city asset management. i am slightly confused as the estate agent has advertised the service charge for the flat at 900 per annum. however, my solicitor has noted the current owner pays £150 A MONTH. is it normal for estate agents to use con tactics on adverts?

    if an estate agent opens their mouth you know they are telling lies..
    "Do not regret growing older, it's a privilege denied to many"
  • G_M
    G_M Posts: 51,977 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    Old_Git wrote: »
    if an estate agent opens their mouth you know they are telling lies..
    you need to expand on that since OP says:
    the estate agent has advertised the service charge for the flat at 900 per annum.
    Mouth may never have opened......
  • AdrianC
    AdrianC Posts: 42,189 Forumite
    Eighth Anniversary 10,000 Posts Name Dropper
    What the EA says the service charge is is irrelevant.
    What the vendor is paying is irrelevant.

    The only figure that matters is what the lease and the management company say YOU will be paying.
  • AlexMac
    AlexMac Posts: 3,064 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    bouicca21 wrote: »
    You need to find out what the £150 a month covers - is it just service charge or does it include ground rent?

    A lot will depend only the type of property. The biggest single item in my service charge is insurance and the cost of insurance will obviously vary according to age and type of structure.

    Is there a sinking fund? Is it on one of these modern estates where the service charge includes maintaining the communal roads and spaces?

    Why is it paid monthly? What service do the leaseholders actually get?

    Irrespective of wheter the original error was cuck-op or conspiracy (and I suspect the former, despite my general caution about the ability of EAs to get legal detail right) Bouicca's right in that what matters is what you pay and what you get for it. £1.8k p.a. does sound toppy, unless it includes a sizeable contribution to a sinking fund, or estate and roads maintenance or unusually high insurance costs.

    For example, I pay or have paid
    - £420 p.a. on a 1-bedroom flat in a shared freehold for insurance, routine maintenence of building and a contribution to a sinking fund, and that's for a 120 year old listed block
    - £600 p.a. on a 2-bedroom flat to a Council freeholder for insurance, communal energy, routine maintenence of building and grounds, and caretaking (no sinking fund, however- so major works like window renewals or external decs are charged as a one off).
    - £900 p.a on a 3-bed flat which, because of its seafront location and past negelct had high maintenence costs, requiring repainting every couple of years ...
    -only £1.4k pa. on another 2-bedder in a listed building (admittedly 4 years ago), including for insurance, energy, maintetence and a chunky contribution to landscaping and road repairs on a big private estate, as well as a very adequate sinking fund...

    But most of those were self-managed shared freeholds where we didn't have a greedy freeholder of agent...

    So ask before you buy!
  • I remember when buying my flat the EA said service charge was £100 per month.

    In reality it is not a set fee and is paid every six months in advance. The fee varies depending on if they actually fix anything. If it's just the standard gardening, insurance etc then it is about £600 every six months (so £1200 PA) It has been as much as £1500 PA. And each year insurance seems to go up.

    Other friends seem to pay more if they have lifts in the building or shared facilities such as a gym. We do not have any shared lighting or lifts, just a carpark.
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