Nervous about Service Charge on a Freehold

brooky_agn

Hi All,

We are in the process of buying a new home (Linden Homes). It has a service charge of nearly £500 a year and the management company (owned by Linden Homes) will be baked into the Land registry.

I'm very nervous about this. Should I be? :eek:

I'm sure many people own a property with similar arrangement. As the home owner does anyone know if there is any protection against rip off escalating service charge fees? Who's to say in 5 years time the fee hasn't gone up 10 fold?

Big UK house builders have had a great deal of bad press recently and we certainly don't want to be a victim.

Lucky_Duck_2

I wonder if you are confusing charges for maintaining the estate's road and landscaping with ground rents?

brooky_agn

Thanks for your reply. Sorry if I wasn't clear. It concerns service charge for maintaining areas not adopted by the council. It's a freehold property with no ground rent.

Lucky_Duck_2

I have lived in houses with similar charges for 10 years now, it is annoying but I haven't yet experienced any increases in costs of the magnitude you describe.

brooky_agn

Have you been content with the service and are most residents happy?

Lucky_Duck_2

I pay about £250pa, somebody comes every so often and mows the lawns, etc.

Nothing much else to report.

Lysimache

You can in future challenge iffy service charges if they are costing more than the services they provide. It's different to ground rent - ground rent is profit for the company. Service charge is for repairs, renovations etc.

rtho782

There is no way to challenge it. Leaseholders can challenge service charges, freeholders cannot.

http://www.solegal.co.uk/estate-rent-charges-beware-buying-freehold-homes-private-estates/

They can put the charges up to whatever they want to.

Friends of ours bought a house on one of these new build estates, the charges stayed low until the builders completed the estate and moved on, then went up every year.

G_M

I'd walk away, and tell the developer in writing to Head Office why I was doing so.

But that's me.

If developers want/need to set up arrangements for maintenance/upkeep etc, they should do so via a Residents Association or similar legal structure.

If that cannot be done in a financially viable way till sufficient properties are sold, then a timescale to do so should be agreed as part of each sale.

hammy1988

We've just moved into a Linden homes house, our maintenance fee is £180 per annum. We have been here three months now (first wave) and we won't pay it until the roads and everything have been built properly.

I'm not concerned over the fee, nearly all new developers have this.

G_M

hammy1988 wrote: »

We've just moved into a Linden homes house, our maintenance fee is £180 per annum. We have been here three months now (first wave) and we won't pay it until the roads and everything have been built properly.

I'm not concerned over the fee, nearly all new developers have this.

Yes but it's because so many people just accept it without question that it's become so prevelant.

At least with leasehold service charges, leaseholders have a right to take over, and manage the maintenance themselves if they so wish.

Freeholders have no such right, because when leaseholders were granted that right by Parliament, it just wasn't an issue. Management charges for freeholders is a new phenomenom, and not a positive one.