Evening all,

We went to look at a house on Saturday which is on a small new build/development. Was all looking good and the wife quite liked it. They gave us an information pack which we read and it says the development will not be adopted by the local authority because its a private development?

Now, most new builds would, on the face of it, be a private development and when completed and everything is done to a required standard, the LA adopts the road etc.

This has put us both off, as there are a few 'good' examples around where we live of why you would NOT move on to a road which has not been adopted. The builders rang me today asking if we had any more thoughts and I told them that we basically lost interest when we found out about the non-adoption, as it just smacks of future neighbour disputes to us.

To try put my fears to rest, the builder has set up a management company which they told me everyone HAS to pay in to, and it's a restrictive covenant(?) in the deeds. So knowing f'all about such things, does anybody know:

a) What actually happens if one or more of the residents stops paying in?
b) What happens if £10000 worth of work is required on the road, but there is only £5000 in the pot? (each house has to pay in £175 a year X 15 houses)
c) Does anyone have experience of living on such a development?

This is probably normal, but one of the directors of the management company is also a director of the developers, so will no doubt be taking a cut?

Cheers

-
Q

 

Effectively it is like a leasehold property in terms of management of the communal areas. Usually there are strict rules on how the management company is run, and no doubt, once the estate is up and running, homeowners may be asked to join the managment company, or a committee to help run the estate.

If a resident stops paying and it is a condition of owning the home, they can be taken to court for costs, and expenses incurred recovering the funds.

 

Also, aren't management companies run as charities, so no-one can "take a profit"? Its for the same reason that they won't be taxed on any annual profits arrising from more income in a year than expenditure.

 

I live on such a development. Personally I prefer the idea of residents looking after their own communal areas and roads rather than the council - they have a vested interest in keeping the area clean and well maintained compared to the council.

I understand your hesitancy regarding the payments, but I would big maintenance projects would be put to a vote before going ahead (as has been done with some other matters), or at the very least they will try and drive a hard deal. The alternative would be that a council would take a year or two, and do a half-arsed job

 

Our house is ex-MOD so the roads and green areas aren't adopted. The servicing is carried out by some branch of MOD - I forget what its called.

Its £24 a month and has been going up since we moved in. We have a residence meeting where any non-resident has to be vetted and agreed to attend beforehand. No solicitors, no reporters.

It is a problem for me because we had been told that the running of the company would be handed over to the residents in time. Now 12 years later and the MOD won't hand it over - they still use 3 houses which is their excuse and at the last meeting in their own words because of the MOD cut backs they are unlikely to hand over the running of the company to the residents any time soon. So in effect we are helping to fund the MOD.

The meetings are always an absolute bun fight. The last meeting one resident got drunk and there was mayhem. Still what else you gonna do on a Tuesday evening.

 

christ no! Management companies or 'factor agents' are according the the OFT "one of the least customer service orientated industries around" The scottish govt is passing regulation to sort them out.

I have had a lot of issues with mine, but the basic premise isn't bad, they'll chase people for payment, so no worries there and the work should get done. however, do expect to get bills for £50 just to change a lightbulb etc (obviously you only pay your share which will be 30p or something but the point is thety'll pay loads of cash to their mates for simple jobs.

I think Puff means a residents association, forming one of these will be the only way to sack the management company. The trouble then is you need to pursue non-payers.

You need a doc off the builder that says how they've set out the contract with the agent about costs too.

all in all, find out who they are thinking of appointing, check their history, see which other developments they work on. If you aren't happy say so but it shouldn't be a reason not to get a place that you like.

5t.

 

IIRC from my gran's block of flats (two storey block of eight single floor flats). The residents/owners jointly purchased the leasehold and formed a private residents association to take care of the costs with upkeep of the building and surrounding access. The people who run it are actually the people who own the flats. This is a little different to your case where likely a 3rd party company will be running it and no doubt take a % fee for admin as part of a income. Obviously those who run and admin it all are entitled to take expenses, but its likely a firm doing it may take a bigger cut than a private individual(s) as it'll have bigger overheads (and manager's wages ). Although that depends if that individual takes the p*ss. If its a third party company doing it there is also danger residents expect them to be like the council and do everything and everything without taking into account the costs of doing so, this could mean you end up paying more than you need to for building/area upkeep because the company is employing people to collect litter and prune the hedges.

However in the case of my gran's flat it works fairly well as urgent stuff that needs to get done gets done, like a tree fell on onto the front of the building in some gales earlier this year. It got cleared and made safe the same afternoon, same goes for water leaks, repairing loose slabs on the steps etc. However silly stuff doesn't get done - like mowing lawns and tidying gardens, as the cost of employing someone to do that is stupid, it takes nothing for a resident to walk out and mow the small patch of grass infront of their flat (part of the agreement on the rented flats is tennants living there must mow the their patch of lawn).

Anyway, if someone doesn't pay. They get taken to court. They are legally obliged to pay as per the legal agreement they signed when moving in (or when the managment company was formed in our case).

If there is not enough money for work that needs to be done, you either wait until there is enough. Agree in a meeting to pay more into the pot or to obtain a loan. I'm not sure if you can be forced to pay more money into the pot, however I guess this depend on the agreement (check the small print! ). and if it is seen as a reasonable demand accepted by a majority.

And that is possibly a sticking point when payments need to be revised. Currently there is a bit of a sticking point with my grans flats about resurfacing the access road round the back. There is the money to easily cover this, but the road is often shared and used as rear access to the gardens of a line of terraced houses. Even though the flats "own" the access, its seen that for it to be fair, residents of those houses should also contribute for the road's upkeep (in return gaining joint ownership/rights to use the access road), however when enquiring many residents said "we don't use it" when we full well know they do as some have rear garages and we've seen them park their cars in there. So currently we're looking at an ultimatum of asking them to pay, or have the right of way blocked off (likely electric gates on the access road entrance), however eleccy gates is a cost and inconvienience nobody in the flats wants to approve.....tricky, so its not all rosey.