What will happen after 50 yrs !

confuzed

Well, i was thinking of a scenario (worst case assumptions though)

Mr. A buys an apartment in Dublin out of any new multistory apartment blocks and lives there, for say 30 years, and pays his mortgage. Now he is an owner but it is just an apartment and it won't last for ever. Building becomes shabby in 50 years.
He can't sell it (No one will buy it) and he can not rebuilt it because he does not own any land.

What will happen to all these apartment in 50 years time?
Does he really own anything?

markpb

Management companies are reccomended to put aside an amount of money each year into a sinking fund. Initially it's meant to be used for large capital projects such as lift refurbishment but in the long term, it's so the estate can work on a project to refurbish or replace the entire block if necessary. I think the idea is that the owners would sell the entire block to a developer who will knock it and rebuild it. It would require all the owners vote though.

I don't think it's happened for an apartment block in Ireland yet but there was a case last year where all the owners a row of houses in south Dublin sold their land collectively so a single developer could get the entire site.

is_that_so

Aside from the fact that he'll probably be over 80 and won't be all that concerned about what he "owns".

Jo King

He may well be very concerned. It is likely that the value of a persons residence is the largest single capital asset for many people of 80. At an age when the majority of them can no longer earn, and money is needed to pay for their care, realising the value of their home is often crucial for their welfare. Look at the increasing use of equity release schemes by older people.

confuzed

markpb wrote: »

Management companies are reccomended to put aside an amount of money each year into a sinking fund.

Are they really doin it? I doubt.

Well i would like to pass on my property to next of my kin when i die. Why not? I inherited my parental property.

It has not happened in Ireland because this Apartment culture is introduced recently.

I think we need some kinda regulations/ policy (not only suggestions) to make sure people get their real share of property when they grow old.

Pa ElGrande

Check with structural engineers, a lot of the new build apartments are going to need major maintenance after 15-20 years.

seamus

confuzed wrote: »

I think we need some kinda regulations/ policy (not only suggestions) to make sure people get their real share of property when they grow old.

People who own apartments generally become part of the management company, with the right to vote on actions and even be part of the board and make the decisions themselves.
Management companies aren't a big bad wolf, they're more of a resident's association with actual money and the ability to make changes.

Common sense would dictate that any apartment block gets a structural survey at least once every ten years along with inspections of plumbing, electrics, new carpets and paint, and so on.

The buildings will only become shabby if the owners allow them to.

antoinolachtnai

Pa ElGrande - do you have any source for this statement?

The thing about buying an apartment is that you are really buying a share in a community rather than a piece of property in the old sense (although all non-ag land derives a large part of its value from its connection to the community).

Pa ElGrande

antoinolachtnai wrote: »

Pa ElGrande - do you have any source for this statement?

There are no public sources for this information, these are the personal opinions of three professional engineers with many years experience, that I have acquaintance with. The buildings themselves are structurally sound, however, the materials used for cladding and sealing of buildings do need maintenance and some materials were applied in a hurry with little if any quality control in order to meet deadlines. Some buildings do not comply with the building regulations (e.g. stairwells too narrow for public access) and you already know about the lack of sound insulation (its a regular topic on this forum).
Also for those of you getting an engineer/professional in to do snag lists be aware that some builders often leave deliberate snags for the person to find (such as not painting a wall or removing doors from their frames), otherwise the engineer will be compelled to look beyond the cosmetic snags in order to put something on the list for the client and might actually have to look at the drains or other aspects that they don't want you looking at and are expensive to fix.
Don't forget also that as new regulations are introduced in the future by the department of the environment over the lifecycle of the building, upgrades and other works may need to be carried out.
The Ballymum flats only lasted about 35-40 years before they were demolished, the same will be true of most modern apartments.

johnnyskeleton

A lot of flats are sold as long term leases, the idea that you can have full title (fee simple) to an apartment is a bit of an academic quagmire.

If I ran the world, I would make sure that apartments are sold:
1) on a 99 year lease to each tenant
2) with an equal share in the title to the land to each tenant (i.e. if there are 20 tenants they all own 1/20 share)
3) the share of the land is restricted so that the tenants cannot sell the land without also selling their apartment
4) as an alternative to 2+3, the managment company gets full title to the land on trust for each of the tenants.

This way, if the flats become so delapidated that they need to be knocked this can be done by agreement of all the tenants or by the managment company. Also, when the 99 year leases run out, the tenants can renew their own leases (as they are owners of the land) so effectively they can live there forever.

What seems to happen in some places is that a development company buys the land, sells 99 year leases, and keeps the title to the property. While no one really looks ahead 99 years, if you look at some of the scandals during the boom years e.g. that guy who tried to turn the common garden in Rathmines into a car park, or any of the developers who developed on green spaces because the council failed to purchase it.

As for antoinolachtnai, I would have thought that it could be taken as a given that the apartments that have been put up hastily in the last 15 years are seriously sub-standard in this forum.

antoinolachtnai

I don't think the new apartments are great, but 15-20 years? They will last longer than that. The apartment developments from the 80s are still surviving. I'm not saying they're great, but they're still there. On the other hand, the blocks from the 60s are definitely running into issues.

The problem with apartment blocks is that when it comes to renovating them, it can be difficult to get agreement among the apartment owners. Lack of rights to redevelop the property are rarely the problem.

There are apartment blocks in Dublin, built in the 60s, with a lot of mature, seemingly sensible owner occupiers, where there are major disputes among the owners about renovating. In reality, the land underneath is often worth more than the building. They should really knock and build a better building on the footprint. But the impossibility of getting consensus makes this very difficult. We're talking about people's homes and the discussion becomes very fraught.

I think the best situation is probably a 99 year lease from the landlord (possibly the State) to the management company. At the end of 99 years, the whole thing reverts and the land can be redeveloped or (possibly) renovated.

As a result, the apartment depreciates fairly rapidly over the 99 years.

confuzed

antoinolachtnai wrote: »

On the other hand, the blocks from the 60s are definitely running into issues.

There are apartment blocks in Dublin, built in the 60s, with a lot of mature, seemingly sensible owner occupiers, where there are major disputes among the owners about renovating.

Do you know any of these having owner disputes or is it ur assumption?

That is whole point. He pays mortgage for 30 bloody years. Own an apartment and after another 20 yrs when he doesn't have any money (Mr A is 70 yrs old) he is supposed to pay money to renovate building block.
:eek::eek:

I will never buy an apartment.

antoinolachtnai

Yes, I know of such a block in some detail. I know some limited details about another.

These buildings are only built with a lifetime of 100 years. It makes no sense to expect the property to appreciate over the 100 years.

If you want to live in a central area, unless you are very wealthy, this is going to be the only option you will have. You can delude yourself with a 999 year lease, but that's not going to change the lifetime of the building.