Shocked by residential management company fees

AzzA101

Good afternoon all! 

 

I'm not usually want to moan but just feel a bit blind sided today so feel like having a bit of a rant. 

 

I'm due to complete the purchase of a flat next Friday 7th February. I had a quote from the conveyancing company of approx £1350 but I totally understand that this can fluctuate slightly. A few hundred pounds over perhaps. 

 

I've had completion statement through today and the figure has shot up nearly £900 to £2250. I asked my conveyancer what the extra charge is and they said it's fees from the residential management company. 

 

I asked my conveyancer why I wasn't told about these fees earlier but they only received these details yesterday. 

 

I'm just shocked and worried that I have a week to conjure up £900 and think these fees are extortionate. My conveyancer said these fees include transferring over the ownership details of the flat. 

 

So yes, just a bit shocked by all these and wanted to vent. 

Mark_d

Service charge fees for my flat are around £1400 every 6 months.  So if I was completing on purchase next week, I'd expect to pay about £1100.
Are you aware of the ground rent and service charges for the flat you're buying?

AzzA101

Yes, I'm aware of the service charge fees which are charged monthly at £90 as well as the ground rent which is £140 a year. These are included with the fees paid a month up front. Again, this is fine as it seems logical.

I have the following other fees on the statement:

Notice Fee - Oakland	120.00
Deed of Covenant - Oakland	120.00
Certificate of Compliance - Oakland	60.00
Notice Fee - Estates and Management	310.00

Two notice fees? It all just seem a bit vague and a chance to rinse you just before completion with little time to back out with no option other to pay up.

Or am I reading too much into it?

anselld

The fees should be detailed in the Lease (otherwise they should not be paid).  The Lease can be read prior to even makiing an offer or starting conveyance and it is usually advisable to do so if considering an offer on a leasehold property.   If the vendor does not provide a copy of the Lease it can be got from Land Registry for a very small fee.

AzzA101

I'll admit that I've overlooked that then as I didn't ready any lease documents before hand.

To be honest I've put my faith into the conveyancer to inform me of this as I believe that this is what I'm paying them for. 

I'm buying this property on my own and for the first time so I might just have to put it down as a lesson and not be so naïve next time. 

RAS

You have read the leasehold documents since, haven't you? So you know if you are banned from painting the walls, having pets, relocating service outlets in the kitchen and bathroom, and how much they will charge if you want permission to sneeze?

eddddy

I'm guessing that the background might be something like this...

• You are buying a flat with a tripartite lease - i.e. The lease has 3 parties...
• 1) The leaseholder - which will be you
• 2) The Freeholder - and Oakland is either the Freeholder or the Freeholder's agent
• 3) The Management Company - and that's Estates and Management

The lease says that when a flat has a new leaseholder, the leaseholder (or their solicitor) must...

• Send a Notice of Assignment to the freeholder (so they know you're the new owner of the flat)

• Send a Notice of Assignment to the management company (so they know you're the new owner of the flat)

• Sign a deed promising to obey the terms and conditions of the lease

• Send a Certificate of Compliance to Land Registry (confirming that you've done all of the above)

I suspect that your solicitor will have checked the lease to see if it really does say all those things are required, but you can double check the lease, if you want.


The law says that freeholder and management company can charge reasonable fees to cover their costs.


So for example, to charge a fee of £310, the management company should be doing about 3 hours of work dealing with that notice.

I suspect they might not be doing 3 hours - so you could try challenging that fee at a tribunal. You might get it reduced by £100 or even £200. But going to tribunal will involve some hassle.

AzzA101

Thank you all for the reply and information. It's all starting to look a bit clearer already. I've got a lot of ready to do tonight!!

Thanks again