Property purchase - apartment but no management company

lk01

Hello

Can anyone please advise me as to the pitfalls of buying an apartment which has no management company?

Property was sale agreed to someone but their lender wont agree to mortgage. So the auctioneer tells me cash buyer is needed.

Location and price are excellent. The property is for rental purposes. I presume no issues with insurance and bins? I dont expect to sell it again for a very long time, so no short term resale issues.

Any advise much appreciated.

thanks

L1011

Long-term maintenance issues are inevitable if there is no management firm; also depending how the title is the property may be unsaleable at all as they may not be able to transfer the lease to you.

Run, don't walk, away from this. There's a damn good reason the banks are refusing.

the_syco

MYOB wrote: »

Long-term maintenance issues are inevitable if there is no management firm; also depending how the title is the property may be unsaleable at all as they may not be able to transfer the lease to you.

Run, don't walk, away from this. There's a damn good reason the banks are refusing.

Agree with the above.

Also, I'm sure you got the apartment checked out, but what about the rest of the building? Did you check out the apartment above you? Or how about the roof? Should the roof get damaged, there's no management company to fix it, and as we're talking about a possible bill of thousands... you may be left with a large wet hole in your roof.

"Cash only" often means "we don't want the standard checks done". IE; they know they're selling you a lemon.

emeldc

The OP is the seller not the buyer, if I'm reading it right.

skelligs

Very strange that an apartment block does not have a management company - who insures the communal areas? who cleans the communal areas? on what basis is insurance for the building done?

Maybe see if there are any owner occupiers in any of the other apartments and ask a few questions?

emeldc

skelligs wrote: »

Very strange that an apartment block does not have a management company - who insures the communal areas? who cleans the communal areas? on what basis is insurance for the building done?

Maybe see if there are any owner occupiers in any of the other apartments and ask a few questions?

They go bust because the residents don't pay the management fees. Not particularly common, but it happens.

P. Breathnach

The situation becomes a legal minefield. The management company owns the building, and lets the individual units on long leases to the holders of the individual units. If the management company ceases to exist, there is no ultimate owner - just people who occupy the units.

I'm in the market for an apartment. I would have very strong reservations about buying where a management company was in poor shape. I wouldn't spend more than 5 seconds considering a proposition where the management company was defunct. If I were foolish enough to give it a thought, my solicitor would take a strong position, and I suspect that she would refuse to act for me.

dudara

Moved to Accommodation & Property

dudara

the_syco

emeldc wrote: »

The OP is the seller not the buyer, if I'm reading it right.

I'm not sure either way.

From

lk01 wrote: »

I dont expect to sell it again for a very long time, so no short term resale issues.

you'd think the OP is not planning to sell it after they buy it, but

lk01 wrote: »

Property was sale agreed to someone but their lender wont agree to mortgage. So the auctioneer tells me cash buyer is needed.

sounds like they're the seller.

emeldc wrote: »

They go bust because the residents don't pay the management fees. Not particularly common, but it happens.

For this reason alone, I'd suggest the OP runs away at high speed. If the residents don't pay management fees, there's a high chance no-one cares about the various facilities (lights, plumbing, etc), and once any existing contracts run out, the place may stop functioning correctly?

emeldc

the_syco wrote: »

I'm not sure either way.

Actually neither am I, now that I read it again

riclad

NO management company ,no repairs,
buildings will have leaks, bad lighting etc
at some point apartments will be impossible to sell.or of very low value.