Your property questions answered
My service charge is way above going rent
Q The annual service charge on my one-bed in D8 has gone up to €1,700. When I first moved in I was under the impression that management fees are usually the equivalent of one month’s rent. That was roughly true over the past two years but this increase (from €1,450) is not matched by falling rents in the complex. I heard that a one-bed recently rented for €975. Is there anything I can do?
AService charges aren't pegged to rental rates, rather they should reflect the cost of the services that the charges must cover, like insurance, landscaping, electricity, sinking fund, refuse charges, and so on. It may have seemed that there was a "rent equals service charge" equation but that was because rents were high up to two years ago but have been either static or falling since.
Service charges tend to increase year-on-year. As an apartment owner, you are a member of the management company and you should be involved in the decisions that company makes to make sure you are getting value for money. For example, it should be possible to get highly competitive quotes on landscaping, decorating, upkeep, etc. Some charges are rising – ESB and gas bills rose a lot in the past 12 months – but, if your block is an older one, it may not be as energy efficient in terms of lighting and heating as it should be. You should also ensure that all units in the development are paying their share – a serious problem in some developments. The more involved you are in the management of your block, the more the management fee will make sense to you. Make sure also that, if refuse is included in the service charges, then you get a tax break on that portion of the fee.
How can I reduce my offer?
Q Is it possible to underbid yourself? Two weeks ago I (impulsively) put an offer on a two-bed apartment because it is perfect for me. It was accepted. But I now feel that I bid too much. I have since done some research online and see that there is another apartment in the same scheme for sale for €40,000 less – there was no “for sale” sign so I couldn’t know it was for sale. I don’t want to lose “my” apartment but I don’t want to pay too much. Can I get back to the agent with a reduced offer?
A See the other apartment immediately to make sure that you are comparing like with like – not all two-beds, even in the same development, are identical in terms of size, aspect, and even fixtures and fittings. Once you have satisfied yourself of that, get back to your agent and explain your thinking and put in a new bid. It is possible to bid lower than your original offer because in property sales the price isn’t fixed until the final contract is signed. If the two apartments are the same then the agent won’t be surprised by your call and should be happy to put your new offer to the vendors. There is no guarantee they will accept it but that is the chance you take. Emphasise your attractiveness as a buyer: have you the money in place and can you sign contracts immediately?
Your questions
Send your queries to Property questions, The Irish Times, The Irish Times Building, 24-28 Tara Street, Dublin 2 or email propertyquestions@irish-times.ie. It is not possible to respond to all questions. This column is a readers’ service and is not intended to replace professional advice.
