New home 'freehold' management fees/additional purch costs

Griffin83

Hi all
I am in the process of buying my first home, which is 9 years old. I found out down the line that there were annual management fees and though I accepted that, I have just been told we now need to pay £550 upon completion for:
Deed of Covenant, Certificate of Compliance & Membership Certificate.

I've found this frustrating, to find out so close to completion and having spent a day researching, the sum seems high, something our Solicitor agrees is excessive. In terms of the Cert of compliance, I can only see this referenced to 'leasehold' properties online.

Does anyone have any experience with these fees? Do they seem about right? Is there anything we can do to argue them? What do we even get for them?

I've read so many 'fleecehold' horror stories. They greedy builders/mgmt agencies seem to have misunderstood the 'free' part.
Thanks so much for taking your time to read this. Any help will be greatly appreciated.
Thank you

D_M_E

Doesn't help, but in this context it appears that Freehold would mean "we are free to hold the homeowner to ransom".

Caitykinss

We have also just bought a 9 year old property with this sort of arrangement (and aren't happy with it at all but am reassured this is the case for most new estates). We paid £199 to the management company for setting us up as the new owners (deed of covenant etc) and £165 to the solicitor for the privilege of them sorting it out (!).

Does your £550 include a portion going to the solicitor?

Griffin83

They've broken down the fees to go to the management agent and haven't incorporated a fee for them. So the £550 is split between the 3 components and payable to the agents.

It was suggested that we ask the vendor to pay the fees (or even half) but I haven't a clue on things like this. Just something we hadn't budgeted for.
Thanks for your replies

RelievedSheff

The management fees are nothing to do with the freehold of the property. You own the freehold. The management fees are to cover the costs of the maintenance of the shared areas of the development such as the public open spaces.

Unless the local council adopt these areas then it is up to the residents of the sites to pay for their upkeep. Due to cut backs in government funding more and more local councils are refusing to adopt these spaces. In this instance it is not the developers to blame.

We were lucky and our estate does not have any management charges as our local council is one of the few that do still adopt green spaces and they maintain them really very well.

hazyjo

Remember your buyer will have all this when you sell. Plus I should imagine your vendor has had to pay £200-600-ish for a 'management pack' which they probably weren't expecting.


Not saying it's enough to put you off buying, but be aware in the future when you sell. You might end up with that and your buyer's bill if they're of the same mindset as you in thinking about asking them to pay all/half.


Personally, yes, I would say to your solicitor you weren't expecting it and see if the sellers will pay it, or a percentage of it. But don't be too disappointed if they say no.

SallyAnneBooth

I walked away from a dream home due the Management/Service Charges. In my case these were unregulated and can rise rapidly without any legal protection. Freeholders just have to pay the bill and don't have the same rights as leasehold properties.

Just make sure to read the Terms and Conditions in your contract carefully before committing to it.