Service Charge -Shared Ownership

m344

Hi all

I've been on here a while trying to move out of the FTB status. Let me start by saying in the end I moved into a new build on one of the discount market rent schemes. It's been awful and I will not be buying one! 

I have found a shared ownership resale house which is very reasonably priced and I'd like to purchase it. I am however confused about the service charge. In fairness it is ££ a month instead of the £££'s that comes with a new build but can anyone tell me what it could be for? This house is on a road mixed in with private owners and renters with nothing to do with the HA/Developer. So there is nothing communal this property is getting -it is not on a new build development site. So no lifts, ground mantainance, window cleaning etc. I've asked the owners and they are requesting a break down as they don't know but from my own experience in my building (from neighbours who own) it could be months for them to actually get a hold of and I'd like to complete pretty quickly. I don't however want to be like the SOs in my building paying for a service they don't receive. Especially as service charge is limitless -it may be cheap now but in a few years it could theoretically double.

Can anyone advise on what kind of things it could be for? If charges are genuine no problem, but it's the principle for me and I don't want to pay for something I don't get. In my apartment the providers are for example charging for monthly window cleaning only to recently let slip the appointments are quarterly. I don't want to be in a similar position. 

user1977

m344 said:

This house is on a road mixed in with private owners and renters with nothing to do with the HA/Developer. So there is nothing communal this property is getting -it is not on a new build development site. So no lifts, ground mantainance, window cleaning etc. 

No private roads, car parking areas, landscaped areas, playgrounds, etc? Bear in mind these could be costs passed on via the HA by whoever manages a larger estate, not necessarily work done by the HA themselves.

If you've already asked the sellers and they've passed on the request, not much else you can do for the meantime.

TripleH

Are you buying a self contained house with no flat in the basement?

How new is the house (roughly)?

It might be the road it is on is unadopted and you all pay to maintain that, or could be a communal garden / play area you pay for upkeep of?

m344

Hi

That's correct, it's a typical house on a tree lined street. Terraced and across two floors no flat below or above.

The house is 100 years old.

There's no communal garden/play area anywhere near by. I have just checked paperwork (that's for the tip as I hadn't even considered it being unadopted) but the road is adopted. 

m344

user1977 said:

m344 said:

This house is on a road mixed in with private owners and renters with nothing to do with the HA/Developer. So there is nothing communal this property is getting -it is not on a new build development site. So no lifts, ground mantainance, window cleaning etc. 

No private roads, car parking areas, landscaped areas, playgrounds, etc? Bear in mind these could be costs passed on via the HA by whoever manages a larger estate, not necessarily work done by the HA themselves.

If you've already asked the sellers and they've passed on the request, not much else you can do for the meantime.

No private roads. Car parking in on the street outside and its the typical residents permit type (not sure if that would qualify as I assumed this is a council thing -they defo issue the permit?). No playground or landscaped area. It is a typical residential street -only thing around is concrete and more houses! To be fair I once lived on an estate and there were bushes etc so understandable. This house is slap bang in the middle of a street of privately owned houses, next road over is a main road. This is what made me go for it as I currently live in the same borough. No bushes or other bits for them to maintain and the owners themselves weren't sure either.

I may just have to wait and hear back. My only problem with that is residents from my building have been waiting a year and nothing even though we can prove they are being charged unjustly. Really want to avoid getting into the same situation because once they've taken your money it seems impossible to get it back. If there is legitimate work being done then fairs fair but I could not see a thing anywhere in the vicinity and neither could anyone else. The price is quite steep considering this. 

I've tried calling the HA and they were clueless also so even more concerning.

eddddy

With shared ownership, the Housing Association often arrange the buildings insurance - perhaps because they don't trust the shared owners to always do it properly.

You could ask the current owners if they or the HA arrange buildings insurance. That might account for a big chunk of the service charge.


More generally, shared ownership are leasehold, so the lease should state the HA's responsibilities (i.e. what you have to pay them a service charge for.)

So if you want, you could ask the seller if you can have a look at their lease.

tinytiddles

I agree with the previous poster, ask to have a look at the lease for the property as the service chargeable services should be itemised in there. 

Unlike private estate management companies, Housing Associations are not permitted to pass on service charges willy-nilly. They have to be able to evidence that the service charges are pertinent to your home and that they are reasonable. The HA I work for will allow any payer of service charges to inspect the accounts upon request to check that they are only paying for what they should be. We don’t get many requests but they certainly happen now and again. 

eddddy

tinytiddles said:

Unlike private estate management companies, Housing Associations are not permitted to pass on service charges willy-nilly. They have to be able to evidence that the service charges are pertinent to your home and that they are reasonable. The HA I work for will allow any payer of service charges to inspect the accounts upon request to check that they are only paying for what they should be. We don’t get many requests but they certainly happen now and again. 

It's probably worth clarifying...

• The law doesn't allow private estate management companies to charge "willy-nilly" service charges to leaseholders. The law says all service charges must be reasonable.

• The law says that all leaseholders must be allowed to inspect service charge invoices, receipts, accounts etc. It's not a special concession offered by Housing Associations.

• The phrase "pertinent to your home" might cause some confusion. It's more a case of "whatever your lease says". (For example, your lease might say you have to contribute to the upkeep of a play area - even though it's 100 metres from your home, you have no children, and you never set foot in it. Or you have to contribute to the upkeep of the lift, even though your home is on the ground floor and you never use the lift.)