BBC Watchdog: Property management fees

Tony

What Consumer Founder
Apr 7, 2008
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Bolton
If you're one of the 1.6 million people who currently own leasehold property, then chances are you're also paying a management company to make sure it stays in good condition.

In March, Watchdog looked into the story of Carrie Murray, a leaseholder who was paying her management company every year to maintain the block of flats she lives in. But the company wasn't keeping its side of the bargain. Anita Rani investigated and discovered the block was riddled with mould, which the management company refused to sort out.

Carrie pays her management company an annual fee so this sort of thing shouldn't happen and if it does it should be sorted. She wanted to know exactly what she was getting for her money and she isn't the only one?

Hundreds of you, right across the UK, have now told us you're stuck paying a management company for services you're just not getting and it seems there's nothing you can do about it.

Rubbish service?
Nancy Doyle and her neighbour Vanessa Hawkins live on an estate in Chatham. Even though the residents on their estate pay their management company over £77,000 a year, it's Nancy and Vanessa who are donning the rubber gloves to clear out their communal bins. The bins on the estate are supposed to be cleaned every fortnight - but on inspection Nancy found rubbish in their bins that appeared to have been thrown out in November 2008. Not exactly a fortnight ago, is it? Nancy has complained to her management company again and again about the bins but nothing gets done.

Another frustrated leaseholder is Tim Wood. His last two management companies were happy to take his money but in return they have left his building in a right old state. Tim moved to the south coast to retire hoping for a quieter life but has told us there has been a lot of worry, a lot of stress and uncertainty as he has watched the building deteriorate. He told us he feels very let down and pretty much abandoned.

Tim, along with others residents in the block paid nearly £1,000 each to have the building painted in 2004 and they're still waiting for it to be done. He now has a new management company and hopes things will improve.

Watchdog decided to bring together just some of the people who have contacted us about their management companies. Most say they are getting nowhere with their complaints and they are at the end of their tether

One man, Bob told us: "Because the company doesn't do what it says it's going to do then you might as well open the window and throw the money out."

Edwina agreed adding: "We've all got to pay this money and none of us are getting a good service?"

It was quite clear from what everyone was saying that when taking on your management company, the odds are against you. So shouldn't there be a way to give more power to the people who deserve it most - the residents who pay the fees.

What the experts had to say
At the moment it's just too easy for management companies to get away with doing very little. The industry is self-regulating and complicated by property laws that date back to 1066. No wonder our expert on residents' rights, Bob Smytherman from the Federation of Private Residents' Associations (FPRA), told us the system has got to change.

He told us that there needs to be a clear regulatory code and a clear legal frame work, with minimum standards. This would mean if you move into a leasehold property you know what you can expect from the person responsible for the building in which you live.

Kat Callo is an expert in leasehold property and told us there are ways for residents to rid themselves of their management company. However, she also mentioned that it does take a little bit of work, with residents having to get organised. The process she told us about is called 'Right to Manage' (RTM) and requires at least half of all flats in the building participate. The idea is that once you've finished the process you create your own 'right to manage' company and can get rid of the current managing agents and can instruct a different one

Also joining us was property lawyer Steve Nicholson. He told us that it's unfortunate that although the law gives residents a remedy in certain respects, it's not always an effective remedy - particularly when looking at the cost of issuing court proceedings.

If you were paying any other company for a service they weren't delivering, you would show them the door - sharpish. Should it really be any different with a management company? It's your home and your money, so it should be your right to make sure they do what you pay them for.

Expert advice
For more information on the various ways you can challenge your management company and general information about the industry, watch tips from the property experts.

And come back to this page at 9pm to watch a video with Andrew McKeer from with the Association of Residential Managing Agents.



Property management fees
 

pb1612

New Member
Nov 21, 2009
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No.10 Downing Street Petition

Please sign the No.10 Downing Street Petition calling for the regulation of the unscrupulous uncontrolled property management industry.

Property management companies should be held accountable for poor service, shoddy workmanship and overcharging and this could be our chance!

Therefore, if you are fed up with paying extortionate fees to Management Companies for little work, sign the petition today!

To get link, please Google: petitions number 10 flatownerhelp

Thank you to those of you that have already signed the petition, please ask your neighbours to sign it as well.
 

Rachelle

New Member
Apr 25, 2009
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I finally bought the freehold in my old flat because I was so sick of paying our management company for nothing. The final straw was when we were sent a bill for something like 16k to fix and retile the roof. The quote they sent appeared to be a generic one with quotes for things that didnt' even exist on our roof!
 

pb1612

New Member
Nov 21, 2009
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We’ve been informed that yesterday (Friday 12 February 2010), the Leasehold Valuation Tribunal published the decision in Britain’s largest ever LVT case brough in Nottingham, at City Heights Estate

126 Families living in 6 apartment blocks in Nottingham had had enough of 6 years of hell and got together 2 years ago to challenge ‘RIP OFF BRITAIN’ and the amounts they were being charged by a property management company who were dreadful.

The Freeholder is Peverel and they used their own Peverel Property Management company too.

After two years of fighting two non legal trained neighbours sat in court to fight the case facing an opposition of a Barrister, 2 Solicitors, an Accountant and Senior Managers from the Peverel (Britain’s biggest Property Management Company) during the six day trial.

Stories came out of drinking water being contaminated, disabled wheel chair users trapped in broken lifts, and a women falling carrying a baby on a bridge which had been faulty for years!

There was also evidence in the decision (please contact us for a copy) that shows that Peverel entered into a financial agreement with an insurance broker (Oval Ltd) and Zurich Insurance to receive insurance commissions/kickbacks for keeping 500 estates in Britain with Zurich for Buildings Insurance (ultra high premiums) of which Peverel get 33.05% of every policy (x500) in existence!!!

A major scam, but completely legal.

The court were disgusted by this and have ordered Peverel to repay 6 years of Insurance kickbacks to the 126 families!

Yesterday the court awarded the 126 families a draft amount of £187,573.53!!!

This victory, albeit a lengthy one, demonstrates what we have all been saying during the two and a half years of TheTruthAboutSolitaire and another reason for commencing the ‘Campaign Against Leasehold and Freehold Exploitation’ – because quite frankly, this proves that Peverel / Solitaire are ripping residents off!
 

homara

New Member
Sep 4, 2009
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Excellent piece of news. Congrats to the people who have finally been rewarded for their hard work and determination.
 

howharvey

New Member
Dec 3, 2010
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Hello,

I'm now to this forum and I am just looking for some advice/guidance on the topic of management fees.

I have been living in my new flat for nearly 2 years now (block of 6 flats in total), the flats and the surrounding area are currently still being managed by the property developer as they have not yet finished landscaping, childrens play area, grass etc. However, the management company that are due to take control of the property sometime this month have been charging me for the management of the property. They said that I will be refunded for the maintenance part of the fees (which makes up a very small fraction of the overall cost), but the remaining 75% of the costs (service, administration etc) I will not see again.

Is this right? If not, what can I do about it?