Is this a reasonable service charge (London?)

cashbackproblems

Hey guys

I need to make an offer on a flat I saw at the weekend, but put off by the high charges. It is perfect location wise, size and a newish build, infra red electric heating. However maintenance charge is £150 pm (included building insurance and water), plus £200 pa for ground rent.

I have been seeing older flats and used to charges being £1k-1.5k all in, so this seems quite steep £2k.

Does anyone have a property in London and how much do they pay?

Cakeguts

Is there anything else that the service charge pays for apart from water and building insurance? Is there a garden? Is there a gym or extra facilities?

cashbackproblems

Cakeguts wrote: »

Is there anything else that the service charge pays for apart from water and building insurance? Is there a garden? Is there a gym or extra facilities?

Yes there is quite a nice garden area and plants etc, a gym but its not free.

chelseablue

When I lived in a flat the service was charge was £78 a month, that didn't include water rates that was an extra £44 a month


This was in Berkshire

AdrianC

You're the one thinking of buying it. You tell us if YOU think it's reasonable. If you don't, then don't buy it. Yes, it is that simple.

You do not NEED to make an offer. If you aren't sure how it compares to other, similar, properties, then are you sure you're ready to buy?

missbiggles1

What's the state of the sinking fund?

benjus

In outer London, we pay about £115 / month for building insurance, gardening, cleaning of communal areas, electricity for communal areas, general repairs/maintenance and a small contribution to the sinking fund. We are a self-managing building so the management company doesn't make a profit or pay any wages, and we don't pay over the odds for services (in fact we do a lot of the repair/maintenance work ourselves).

marksoton

By London standards that figure doesn't seem excessive.

Would i personally be happy to pay it? Absolutely not.

Soundgirlrocks

We are in London ours is £135pcm for a Victorian conversion block. We could really do with putting it up and building up the sinking fund at a quicker rate tbh but no one wants to pay more (we own the freehold as a company.) I would look at age of the property / sink fund / any work that is upcoming (or looks like it might need doing) and actually running costs (insurance, electricity, maintenance, cleaning, management fees) comparing those figure will help you see why the service charge is perhaps a bit higher than others. I would be cautious of flats with low service charge but no sink fund, it means at the first sign of problems you are going to get a big bill!

Ground rent isn't relevant in weather the service charge is value for money or not, in so much as that is determined by the lease, and is income for the landowner although obviously a flat with a peppercorn ground rent or nil is preferable overall

cashbackproblems

Thanks, I guess it is normal for nearer builds in London, I don't think there is a sinking fund, but the development was build in 2005 and all looks in good condition and well maintained. £135pm isn't far off and I guess ok.

I am not happy paying that much but if that's the standard then will have to. This is the first newish place I have seen, older buildings are all half the price in charges.

I have to make an offer as there is not much else available which is near a station and in budget, and I have been looking for so long and love the flat. it is going to be below asking so lets see...

thanks

missbiggles1

cashbackproblems wrote: »

Thanks, I guess it is normal for nearer builds in London, I don't think there is a sinking fund, but the development was build in 2005 and all looks in good condition and well maintained. £135pm isn't far off and I guess ok.

I am not happy paying that much but if that's the standard then will have to. This is the first newish place I have seen, older buildings are all half the price in charges.

I have to make an offer as there is not much else available which is near a station and in budget, and I have been looking for so long and love the flat. it is going to be below asking so lets see...

thanks

With highish service charges, I'd be worried about that. When a property's newish and little work needs doing, that's the time to be building up a sinking fund so that a few years down the line most of the money's there to fund the necessary maintenance.