Management Companies for Dummies? FAQ?

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TheReflex

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Hi,
I've recently started looking to buy a house and only when I visited an estate a friend of mine lives in, did I start scratching the surface when it comes to Management Companies.

It is my understanding that estates/blocks can:

1) Have a Management Company - often being composed of the residents themselves
2) Be managed by County Councils/local authorities
3) Neither of the above - normally a bad sign

Correct?

While I had never thought about this before, it seems to be an important part of the whole investigation before an offer is made. I most certainly wouldn't want to buy a house/flat only to find out, after I move in, that there's serious issues with the estate/block, that the MC didn't look at or that were never addressed because there's no MC in place.

So, for a "newbie" or "dummy" like myself, where can I start investigating how these things work? I understand cro.ie may give some insights (for a fee) on how some of the estates are run, but where else can I learn and what other investigations can/should I do?

Thanks in advance!
 
The estate agent handling the sale should be able to tell you if there is a management company or not. if there is, get him/her to give you the company name of the MC and then check them out with the CRO. If they havent lodged accounts or had an AGM, then run for the hills.

Management companies are probably less important in a development of houses than in a development of apartments with shared doors, common areas, bins, etc., but I would still be reluctant to buy a house in a development with a defunked MC.
 
Thanks for your replies guys.

I've been finding a few unusual situations like "there's no MC" or "there's a MC but there are serious issues that the MC can't afford to fix", "the LA won't look after this estate because of regulations the estate/block fails to adhere to" , and, as a buyer, it's quite scary.

I'm guessing that really the only way to know exactly what's going on in an estate, is to actually know/meet someone there who is willing to answer your questions?
 
I tend to avoid properties that have a need for a management company, but I am probably wrong to tar them all with the same brush. I rented an apartment for a few months a few years ago in a brilliant development in the city centre that had a fantastic MC. They had their own full-time manager/caretaker and the place was kept like a hotel. The owners paid a hefty yearly fee though.

I also owned another apartment in a development that was a total joke. Both of the original developers were still the directors of the MC (although both were deemed bankrupt). Half of the fees collected went to a well-known landscaping company just to cut the grass, as it happened the landscaping company was also owned by one of the developers. The rest of the fees collected barely covered the cost of the insurance and we had periods when the public lighting was cut off and the bins were not collected.

If I was buying somewhere that had a MC again I would be doing a lot of homework. Find out who the directors of the company are and what else they are directors of. If they are directors of construction companies and directors of several other MC's, then tread carefully. Ideally, the directors should be owners/occupiers of the development that the MC operates. Check their books to see if the company looks solvent and if there is a decent sinking fund. Check that they hold AGM's. Find someone that lives in the development and ask if there are any issues with landscaping, public lights, roads, sewage, water, etc.

Above all, find out what the yearly management fees are and what they cover. a few hundred is ok, but 2000+ a year will do a lot of maintenance on your own freehold property on a pubic street!
 
And am I correct in understanding that if an estate/block is under all correct planning and regulations, the local authorities will "pick it up" and become responsible for it, after 10 years of it being built?
 
Whatever about housing estates, you won't see LAs taking over apartment blocks
 
TheReflex said:
And am I correct in understanding that if an estate/block is under all correct planning and regulations, the local authorities will "pick it up" and become responsible for it, after 10 years of it being built?
Click to expand...

It depends on the estate and what was agreed with the LA at time of planning. As JDWex said, LA's will never take over apartment blocks. They will also not take over gated developments.
 
Is there a way to find if a given estate is being looked after a county council? Calling the county council itself?

Or is there a database somewhere?
 
I dont think there is a database.
A quick call to the roads dept of the local council might give you an idea.
Neighbours are a fountain of info on stuff like this......
 
There are many developments with excellent managing agents running the complex on behalf of the management company. Of course there are then others which are an absolute disaster with high levels of non payment of management fees. This of course will impact on provision of services.
It is vital to obtain the management company records from C.R.O. This will give you a very good idea of the financial state of the company which you will be a shareholder of. Your solicitor will also be getting a report on the management company, level of sinking fund, planned expenditure etc.
There is so much information available to a prospective purchaser that there is no reason why a person should be caught out.
I do get fed up with apartment owners whinging about their management fees wheninmostcases they wont attend the A.G.M. of their management company and makd Directors accountable.
House owners have to pay for refuse collection, gardening, cleaning insurance etc. but apartments owners dont think of this when giving out about their fees
 
condition of the planning permission fr my home and 72 other to developer. subject to conditions including conditionof management company with responsibility for the ongoing maintenance of all landscaped areas.

That was the house purchase package .... new house with planning permission PLUS warrant of developer to comply with pp and undertaking on completion of site purchase to furnish folio showing man co as owner of them . Complete the package.

homeowner /apt owner TOUT SEUL when selling an apt and called upon to furnish contract to purchaser warranting compliance with the PP and Folio to prove it.

Most of these estate developer are bust and they are in effect s 5 estate under MUD Act.

check condition of PP for apt /house for condition that man co be established to maintain and if that is the case and no folio showing man co as owner of areas to be maintained then cannot warrant compliance with no folio to prove it.
 
The conditions attached to the planning permission are not worth the paper they are written on.

I sold my apartment 6 years ago. The management co in question was set up in 2005. The two developers of the development are still the directors of the management company. The only difference in the structure is that one of the developers appointed his girlfriend as a 3rd director. Both directors are technically bankrupt (one was in court recently stating that he could not afford to pay the tax on his vehicle). The mgt co are still appointing a management agent that have a very cosy relationship with one of the directors. They still sub-contract the landscaping to a company that is owned by one of the directors. The management company address is still registered to derelict building that was sold in an Alsop's auction in 2014.

What I am saying is that these guys have no regards to the conditions of their planning application. They also have no regards to the office of corporate enforcement as they are in breach of a number of regulations of the companies act.

Anyone buying a property in a development with a management company should do their homework. Have a look at their accounts. Find out who their directors are. Find out what the fees are.
 
Member of man co homeowner who purchased this package have choice -

ignore condition of the pp for house /apt purchased that man co be est to maintain landscaped areas in our case. -

or

pursue the developer for the completion of the package purchased either thru the management company or with re locus standii under S24 of MUD Act. .

As for LA ... LA issued that planning permission with that condition.
To expect LA to ignore conditions of its own PP foolhardy .
Land taken in charge cannot not also be land to be maintained by man co under PP ?

Developer of this estate has entered into agreement with LA as a result of which LA has lodged two dealing in land registry of site transfer to LA .

My question to our LA did they not call on developer to furnish that folio in compliance with that condition of the PP.. For how can man co maintain space it does not own - ... ??
 
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