Apartments without Management Company

DrPhilG

I have been looking at an apartment recently, it is part of an 8 apartment block in town. The estate agent tells me that the current owner of the block (the developer who renovated them) is now selling them all. Because he owns the whole block there is no management company in place but he says he will be putting one in place once all the apartments are sold.

Is this unusual? I don't want to go ahead and then find some surprised down the road.

Paulw

Sounds about right. Usually once all units are sold the management company comes in to place and then your management fees fund things like block insurance, common area maintenance, etc.

irlrobins

I would have thought the opposite. As soon as apartments are put on market (rental or purchase) an OMC has to be in place. Developer is responsible for the contributions of any unsold units, and eventually transfer of common areas.

http://www.citizensinformation.ie/en/housing/owning_a_home/home_owners/management_companies_for_apartment_blocks.html

^ Appears to back up my understanding

Mrs OBumble

Your biggest risk is if a majority of the units are sold to one owner - eg a social housing provider. You could end up being out voted by them on evrry single issue.

irlrobins

I think the MUD Act changed this to one vote per OMC member, and not one vote per unit.

DrPhilG

Mrs OBumble wrote: »

Your biggest risk is if a majority of the units are sold to one owner - eg a social housing provider. You could end up being out voted by them on evrry single issue.

These are pretty high spec apartments, probably the most luxurious on the market in town. High rent.

Hence the reason I'm interested as a buy to let. Can't see them going as social housing given the rental value.

5 of the 8 are already rented out.

The developer did try to sell the block as a whole but it didn't shift, hence the individual sales now.

DrPhilG

irlrobins wrote: »

I would have thought the opposite. As soon as apartments are put on market (rental or purchase) an OMC has to be in place. Developer is responsible for the contributions of any unsold units, and eventually transfer of common areas.

http://www.citizensinformation.ie/en/housing/owning_a_home/home_owners/management_companies_for_apartment_blocks.html

^ Appears to back up my understanding

Thanks, I'll look into this.

Spoke to the bank manager and he said it's no problem and the solicitor can take care of it.

Mrs OBumble

irlrobins wrote: »

I think the MUD Act changed this to one vote per OMC member, and not one vote per unit.

Link? I'm pretty sure the opposite is true

QuestionHere

Mrs OBumble wrote: »

Link? I'm pretty sure the opposite is true

Run a mile from this. It sounds like an absolute pack of lies & you are likely to be left with major problems.

Victor

DrPhilG wrote: »

Spoke to the bank manager and he said it's no problem and the solicitor can take care of it.

The bank manager wants you to borrow money. They are not your friend or advisor.

irlrobins

Mrs OBumble wrote: »

Link? I'm pretty sure the opposite is true

Sorry, was confusing it with the change that every vote has equal weight. But MUD Act does allow for one vote per residential unit.

TooObvious

Mrs OBumble is correct, one vote per unit.

There are plenty of OMC's in Dublin now with significant tracts owned by Housing Associations, this is not necessarily a bad thing BTW, but it does mean that on any matter to be voted on the HA usually has a deciding vote in these developments.

OP you say you want to "Buy to Let", if you really want to become a landlord you should consider a commercial property instead of residential, in my experience less hassle and better return.

DrPhilG

TooObvious wrote: »

OP you say you want to "Buy to Let", if you really want to become a landlord you should consider a commercial property instead of residential, in my experience less hassle and better return.

Had considered that. Would have thought you would also have longer empty periods though.

TooObvious

I suppose with any investment comes risk. Good luck either way.

Cupra280

Given that the vendor owns all 8 apartments currently, he is the sole member of the current management company, and it sounds like he has been taking responsibility of all the tasks that the company would usually pass onto the management agents.

As each individual apartment sells, the new owner will become a member of the company. It is the owner who is the member, not the tenant.

DrPhilG

Cupra280 wrote: »

Given that the vendor owns all 8 apartments currently, he is the sole member of the current management company, and it sounds like he has been taking responsibility of all the tasks that the company would usually pass onto the management agents.

As each individual apartment sells, the new owner will become a member of the company. It is the owner who is the member, not the tenant.

That's what I figured, but I've asked my solicitor to clarify.

NIMAN

Are these North or South DrPhil?

DrPhilG

NIMAN wrote: »

Are these North or South DrPhil?

South

NIMAN

Well, best of luck if you decide to proceed.
Make sure you go in with your eyes wide open!