Service Charges on new build developments

headpin

The bottom line on the Council,Tax issue is that on LA maintained/adopted facilities, they are  there for everyone to enjoy, not just those who live by or near to them. On Managed facilities they are private and only available to those who belong to the Management Company PE those who the Management Company permit.

what is important is the status of the Management Company. If owned and managed by the Members - that is the property owners - then it is entirely under your own gift as to what is done and how much the charges are. But, if it is run by a private organisation with no control or influence by the property owners then it is problematic. 

With regards lenders. This type of arrangement has been around for decades and was the way most flats (or apartments as they now seem to have morphed into) were sold. It was the way that everyone was ensured that the fabric of the building and the common parts were kept clean and in a good state of repair. There has never been a general issue obtaining a mortgage for flats with this system. However, unscrupulous developers cottoned on that there was money to be made by exploiting this. There is legislation that now assists. But, the sensible buyer will ensure that the Management arrangements are under the control of them and their neighbours. 

Assuming all Management Companies are run the same way and with the same arrangements is rather naive.

Nymbus

comeandgo said:

Why should people get council tax reductions?  The council don’t own the land so if there was no management company then the land would get no attention from the council anyway.

Because the people who live on these estates are required by law to pay the council tax. If they fail to pay they go to prison. That is to say that people have no choice but to pay council tax to the council. If they are then required to pay an estate fee to manage open spaces that the public may use, I would suggest a reduction on council tax is more than Fair

Slithery

I'm nearly 50. I have no children and have never been to hospital, used the fire brigade or rung the police. Do I get a reduction too?

GDB2222

Nymbus said:

comeandgo said:

Why should people get council tax reductions?  The council don’t own the land so if there was no management company then the land would get no attention from the council anyway.

Because the people who live on these estates are required by law to pay the council tax. If they fail to pay they go to prison. That is to say that people have no choice but to pay council tax to the council. If they are then required to pay an estate fee to manage open spaces that the public may use, I would suggest a reduction on council tax is more than Fair

What’s the difference in principle between the grounds on the estate, that are actually private, and my back garden? The council don’t even come and mow the grass for me, let alone trim the hedges. 

ccbrowning

The house we're looking at is on a small development of less than 10 homes, but has some private draining pumping station and an unadopted cul-de-sac. I have similar in my current house, but the management company is 100% in the residents hands with each of us having a share and voting for directors. The costs have been stable and transparent. 

However, we are looking to move and the onward purchase has an existing Ltd and those directors would stay and each homeowner would getting a share upon completion. So this in theory means the homeowners would just be minority shareholders and the directors could do things like add additional right of ways etc., jack up the price, etc? It’s a small development so I don’t understand why the original developers/directors would stay?

Wording seems suspect:

Save for the inspection, maintenance, repair, alteration, renewal, replacement (where beyond economic repair) lighting and cleansing of the Treatment Plant for which the Transferee shall contribute one twelfth of the costs incurred, the Estate Charge shall be a fair and proper proportion of the Expenditure or estimated Expenditure, as reasonably determined from time to time by the Management Company or the Transferor (as applicable) having regard to the number of properties constructed or to be constructed on the Estate on the basis that the whole of the Expenditure is to be recovered from the owners of such properties subject to the receipt and credit of any contributions received from owners outside the Estate towards the Expenditure.