Fleecehold

[drakioned]

I think people are going to be shocked that its not cheap to run a block of flats, get insurance, repair things, keep communal areas clean and tidy etc even when you take out a leaseholder.

I mean, they're already being billed for all of those things.

 

[BUDFORCE]

Went to see a freehold property that had a £1389 per annum service charge - no thank you.

You should see how much some of the flats they converted out of the Battersea power station were, I mean just the annual service charge, was more than most people's houses are worth.

 

[fez]

I mean, they're already being billed for all of those things.

I know, that wasn’t my point. Some people seem to think that 50p of their management fees are going to upkeep etc and the other £3k is being stolen from them. It’s not.

 

[drakioned]

I know, that wasn’t my point. Some people seem to think that 50p of their management fees are going to upkeep etc and the other £3k is being stolen from them. It’s not.

I mean, there's things like this:

A broker may arrange a policy for a residential development, but then split tens of thousands of pounds in commission paid by the insurance firm with the property manager or owner of the freehold. The total commission can be as high as 60% of the cost of the premium paid by leaseholders.

from https://www.theguardian.com/money/2...n-millions-for-landlords-in-england-and-wales

 

[fez]

I mean, there's things like this:


from https://www.theguardian.com/money/2...n-millions-for-landlords-in-england-and-wales

I'm sure there are. I'm sure there are corrupt and bent people involved in this at every level. Regardless of that fact, far too many people think their management fees are going to be slashed massively if leasehold is abandoned. I would wager that legally speaking they would have to compensate leaseholders as well. Either the flat owner or the government.

 

[MichaelAwkward]

Went to see a freehold property that had a £1389 per annum service charge - no thank you.

I mean that's not that much depending on what it covers.

For comparison, our flat in a block of 11 is now paying £1310 per annum.

That's broken down into £154 cleaning (communal stairwells etc), £81 electricity (communal areas and external lights), £77 gardening for the parking area, £109 for general maintenance (although doesn't get used most years), £63 for H&S (mostly compliance and fire assessments etc), £300 buildings insurance, £13 for directors and officers insurance for the management company, £400 for management which includes the audit and general admin expenses (posting letters, debt collection for arrears, operating the DD scheme etc). The remainder of £113 is for any other expenditure not budgeted that might occur and if not used gets transferred to the sinking fund.

So you can see most of it is stuff that a normal homeowner would have to cover themselves anyway.

As a member I'm also a director of the management company so I get to question whether we're paying too much for any of these things and can ask for them to see if we can get cleaning done for less, for example, which we did a couple of years ago.

It's not all a scam. I'm actually the only owner-occupier who turns up to the AGM and gets involved in the running of the management company, so it doesn't surprise me that lots of people with leaseholds either don't know what their service charge pays for, or have no interest in finding out.

 

[Bald-Eagle22]

I mean that's not that much depending on what it covers.

For comparison, our flat in a block of 11 is now paying £1310 per annum.

That's broken down into £154 cleaning (communal stairwells etc), £81 electricity (communal areas and external lights), £77 gardening for the parking area, £109 for general maintenance (although doesn't get used most years), £63 for H&S (mostly compliance and fire assessments etc), £300 buildings insurance, £13 for directors and officers insurance for the management company, £400 for management which includes the audit and general admin expenses (posting letters, debt collection for arrears, operating the DD scheme etc). The remainder of £113 is for any other expenditure not budgeted that might occur and if not used gets transferred to the sinking fund.

So you can see most of it is stuff that a normal homeowner would have to cover themselves anyway.

As a member I'm also a director of the management company so I get to question whether we're paying too much for any of these things and can ask for them to see if we can get cleaning done for less, for example, which we did a couple of years ago.

It's not all a scam. I'm actually the only owner-occupier who turns up to the AGM and gets involved in the running of the management company, so it doesn't surprise me that lots of people with leaseholds either don't know what their service charge pays for, or have no interest in finding out.

I think it's just being ill informed what a leaseholders entails.

I have been in constant rows with my Freeholder , 1 bed flat has a £1200 service charge and a £400 ground rent, OK I can suffer that but then charges me £400 insurance on top of it all but won't send me the breakdown cost of the insurance. I'm sure there is a massive commission being charged .

Let's see how they interpret the leasehold reform bill on next years premium as its outlawed excessive commissions on insurance.