Common areas not transferred to OMC

mfrutos

Hello,

I am sale agreed on an apartment.

My solicitor highlights that the common areas have not been transferred to the OMC, and that is a red flag. The reason is that there is a dispute on the ownership of the air space above the roof.

Should I walk away?

banie01

What has your solicitor advised?

If I was buying leasehold and there were any "red flags" as to common spaces, access, omc responsibility and areas of ownership.

I would not proceed.

mfrutos

My solicitor has advised to proceed only if the price is very good (which I thought it was, before knowing this) and that the effect of this is probably more in the short term (less than 5 - 7 years) as selling the apartments would be harder until the issue gets sorted out. She thinks eventually it will get sorted out, but in the meantime, selling would be hard.

pjdarcy

You'd have to assume the seller is aware of this issue so I would go in with a seriously low offer and see how they react

banie01

The issue I would have is being tied to an asset that could be very hard to sell on.
It might be sorted relatively amicably and in the medium term, it is also just as likely that it will not be.

What steps have the vendor and omc taken to reassure you that any legal jeopardy is well on the ath to being solved?

Do you and your solicitor agree with their assessment?
Is the risk worth it to you? And can you fund any action that may be needed to ensure a clear title if you decide to sell before the omc have resolved the issue?
If not, have you priced in that risk to your purchase price?

is_that_so

mfrutos wrote: »

Hello,

I am sale agreed on an apartment.

My solicitor highlights that the common areas have not been transferred to the OMC, and that is a red flag. The reason is that there is a dispute on the ownership of the air space above the roof.

Should I walk away?

Do you mean the attic? In our case we have permission to use but not modify in any way. But that was already sorted by the time the block was completed and the original solicitor, probably the OMC solicitor, can clarify it. If you like it and the price try and get the specific details to make your call.

mfrutos

is_that_so wrote: »

Do you mean the attic?

No, I mean the air space. The buildings built next door are some stories higher and the OMC wants to preserve their interests above roof level.

is_that_so

mfrutos wrote: »

No, I mean the air space. The buildings built next door are some stories higher and the OMC wants to preserve their interests above roof level.

OK. I see. Not sure how that affects your purchase though. If the OMC is well run, has a decent sinking fund and maintains the place then that ticks the basic boxes.

The_Conductor

OP- the developer wants to reserve the right to turn the place into a building site and add additional floors to your building.
Unless you are getting a fecking remarkable deal- walk- its a head wreck.

mfrutos

The_Conductor wrote: »

OP- the developer wants to reserve the right to turn the place into a building site and add additional floors to your building.

And that is what the OMC fear. But is there a real risk or are they being overzealous?

banie01

mfrutos wrote: »

And that is what the OMC fear. But is there a real risk or are they being overzealous?

It's quite common for extra floors and tbh if the other buildings in the development are already taller, current market conditions would make any development on an already prepared site/roof structure fairly attractive.
It also is very likely what was originally planned for on construction.
The building walls, foundations and infrastructure are likely all designed from the outset to allow such vertical expansion.

mfrutos

I will think about it, but I guess I will walk away. It is not a bargain anyways and probably not worth the headaches.

Beezasp

I've been looking to buy an apartment for the last 5 months now, the 2 that have been of most interest to me both had this issue. The first one I was sale agreed on and had waited for 3 months without even signing a contract when this issue was finally brought to light. It really should be made clear from the start if this issue exists or not so the buyer can decide to stay away if they are not willing to buy a property with legal issues.

Dolbhad

Beezasp wrote: »

I've been looking to buy an apartment for the last 5 months now, the 2 that have been of most interest to me both had this issue. The first one I was sale agreed on and had waited for 3 months without even signing a contract when this issue was finally brought to light. It really should be made clear from the start if this issue exists or not so the buyer can decide to stay away if they are not willing to buy a property with legal issues.

For a lot of sellers they don’t realise there is an issue with a management company (unless they are directly involved with the running of it which most owners aren’t) until they go to sell and management company answer the legal queries raised and disclose any issue. That’s the problem being tied into one. The management company could be fine when you buy it but if problems arise down the line like litigation, no sinking fund or the management company accounts are at a loss, your stuck with it. I say there are a lot more management companies with problems then aren’t. And most of the issue can only be resolved with money i.e increasing management fees