Developer in liquidation - OMC required?

Glaceon

We bought a house in a new-build estate in July 2022. Earlier this year, the developer went into liquidation without fully completing the estate or handing it over to the county council. The estate is mostly complete, except for the road surface and some drainage issues.

In the estate WhatsApp group, there's a few residents who now want to set up a formal owners management company and collect management fees as a result of this. Is this something that we have to do? I'm concerned about the implications of this and am not keen on the idea of possibly spending thousands a year in management fees.

SupaCat95

Good advice, get a lawyer.

10-10-20

Objectively this can go one of two ways: with the intent of being taken into the CoCo's control, or remaining as an independent community under the control of an OMC. The estate as a whole need to hold a meeting and decide which way they want it. Lawyering-up is only going to frustrate the process at this time.

From what I recall our estate were able to engage with the CoCo and have them draw up a requirements document which outlined the defects and repair/modification requirements which needed to be met before the estate was taken into their control. This gave the Resident's Committee a laundry list of defects and they started work on eliminating each.

There was significant discussion on this topic here around the time of NAMA as many estates were left in the lurch and has to find their way out of the situation.

SupaCat95

The problem is trying to get everyone to assemble at the same and arrive at the same conclusion. Its obvious what needs to be done. Its hard enough paying for the property, without the management fees. Then get told, actually we need €X,000 to find a contractor to pay for the stuff we already paid for and a company to manage the estate, while paying council tax for stuff that rarely gets done. I pay council tax I still have to mow my lawns and the lawns opposite my house. When I am on the phone to the council you get someone with no idea when you ask them the benefits of council tax or where it goes.

JVince

The developer will have a bond in place with the council. The council will call in the bond and have the estate finished.

I'd avoid a formal OMC unless there are common areas / shared areas as it simply is an unnecessary cost burden. However it may be something that has to be created. The sale documents/planning will have that detail.

I'd certainly have a residents group with contributions and have someone look after grass areas, organise litter days, and any other items of concern.

10-10-20

https://www.boards.ie/discussion/comment/123533781#Comment_123533781

That was it - there was a bond remaining in my estate's case which was used to complete the vast majority of the work. The CoCo ended up taking on some of that work - I think that there were 5 driveways which needed to be dished by them or their contractors.

Glaceon

https://www.boards.ie/discussion/comment/123533781#Comment_123533781

The plan originally was for the county council to assume control of the estate once construction was complete. I also confirmed this with our solicitor while we were sale agreed, who assured me that there was no OMC in place. To be honest, if there was, I would have walked away from the sale as I can't stomach the idea of high management fees on top of property tax - plus I have read too many OMC horror stories on Boards over the years! However, the liquidation seems to have thrown a spanner in the works.

I have no issue with throwing a few quid in to help with upkeep of the green spaces. But I can't see how an OMC setup would work here. There are apartments in the estate but they have their own separate OMC that doesn't apply to us. We own our own houses and the parking spaces. Would public liability insurance be required for the estate? Private clamping? All additional costs that I couldn't have envisaged when buying the house.

JVince

Liquidation should make no difference. The council will have required a bond to be in place as a condition of planning.

You need a residents association to get the council to get this sorted.

Anyone who suggests an Omc, let them know that it requires an awful lot of work, and a lot of money. For an estate of 50 houses, it probably would be over €1,000 a year per house and near impossible to reverse.

A decent residents association might need €100 a year and that would leave a few bob in the kitty

digital_d

100% what JVince has said. As a part of planning the developer will have put a bond in with the council to cover this exact scenario, and ultimately the council will have to resolve it, possibly after the winding up of the developer is complete

An OMC is only required under the MUD act so there is no basis to require setting one up now if that need was not there initially.

If there is an appetite for a “Residents Association” or some other voluntary arrangement to enhance the upkeep of green areas to a standard above that which the CoCo will do that’s another matter

If I was in this situation I would either contact or have a solicitor contact the CoCo to enquire about their plans to complete taking the estate in charge and their timeline

Glaceon

Thanks everyone. There's a plan to organise a meeting so I'll definitely take some notes from this thread into it!