Shared ownership HA leasehold management fees for houses (not flats)
18/08/2012 0:49 am
I bought a shared ownership house on a large development in June 2011. The services charges to date are estimates. My housing association service charges are made up of building insurance, managing agent fees ( for the managing agents that provide the communal services to the estate) and the housing association's management & audit fees. The HA management fee in 2011/2012 is approx. 22.5% of the total charges (excluding the Audit fee) and in 2012/2013 it's approx 27%. These figures seem to be excessively high to me. When i queried them the HA's response was " The management fee is a contribution towards the cost of managing estates and providing home owner services and cost is agreed by or board that includes resident members. We regularly benchmark our management fee against other housing providers to ensure we remain competitive and we currently subsidise this cost". There is minimal management required to be undertaken by the HA for my property which is a house not a flat so no internal communal areas and the managing agents fees cover the estate maintenance. Additionally the managing agents fees include a management fee of approx. 21%. Is there any regulations to say how much can be charged for management fees by the HA. The estate management fees also seem high to me but I,m also paying a further percentage on them to the HA in their management fees! My building insurance is approx £100 per year and the estate charges are approx £750 ( inc. managing agent fee) I am then charged a further £200 management fee on top by the HA for what appears to me to be the administration for the building insurance and collecting the estate fees. I really just need advice on what HA's can reasonably charge in my situation. I think I am contributing towards the management/admin for the leasehold HA flats on the estate. There are 188 properties of which only 6 are houses. Thank you
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18/08/2012 12:55 pm
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20/08/2012 9:34 pm
Look at your lease, it will say what services you should be paying for. If this wasn't clear to you when you bought the house, you should have serious words with your solicitor!
For the managment fee, you need to think about how much it costs them to manage the services, do they provide accounts, send statements, make visits to the estate? How are their overheads paid, they need an office, heating, receptionist, phone sysytem? Work out how much it woud cost you to manage the servies to several thousand properties? If it doesn't add up, ask them how they got their figure and you can give them the breakdown for your figure.
21/08/2012 10:10 am
Ask the Leasehold Advisory Service (Las) for advice. Look at "Decisions" at the Leasehold Valuation Tribunal and the Upper Tribunal (formerly the Lands Tribunal) for cases where a view is taken on what is "reasonable".
Warning: it is, as you might have guessed, highly contentious, will depend on evidence to support your case, and can also be highly technical requiring an accountant to provide expert testimony.
23/08/2012 9:15 pm
Thanks for the comments. I was aware when I purchased the property that I would have to pay management fees what I find unfair is that I am paying the same as the properties that are flats. The estate charges are provided by an external company so the only service the HA provides to me is the building insurance. The flats however have communal area services etc that the HA deal with yet they pay the same management fee!
24/08/2012 8:34 am
You've checked your lease, now check the planning arrangements for the estate. Does whoever have responsibility for grounds maintenance also have responsibility for roadways (ie, is the road adopted?) and street lighting throughout the estate? If the local authority do not have responsibility then your service charges cover the cost of these services. Also applies to any other outside communual areas such as play areas and parks. Have you asked your landlord for a full break down of all charges for the previous year? As you have been in the property for just over a year, it is unlikely you have received any information about this yet. I happen to know your landlord will send you a 'balancing charge' calculation that will tell you exactly what has been spent, how much you have paid and if there are any monies outstanding. If your landlord has calculated your charges as higher than the sums actually paid, you will receive a refund. If the costs outweigh what has been charged for the year, you will get a bill.