Residents of a Herefordshire housing estate were featured in the news recently as they were frustrated that their payment towards the estate management were not being actively applied to the maintenance of the estate.

Residents were obliged to pay an annual fee of £480 to the management company in exchange for the communal areas being adequately maintained.

When Would I Pay Estate Management Fees?

This arrangement is very common on new housing estates and will affect many home buyers.

On completion of a purchase of a new build property, the buyer will enter into a covenant with the management company (which is usually initially run by the developer) to pay an annual charge to fund the functions of the management company. This is sometimes referred to as service charge or an estate rent charge. The responsibilities of the management company are usually set out in the transfer deed or management deed.

When the developer finishes the estate, control of the management company is usually handed over to some residents of the development. Those residents usually appoint another company, a managing agent, to carry out the day to day tasks on behalf of the management company.

However, this procedure is not always straight-forward and complications can arise if management companies are not correctly set up and managed.

Examples of management company responsibilities:

  • Cutting and mowing grass
  • Maintaining playgrounds or sports areas
  • Street cleaning and street light maintenance
  • Tree pruning
  • Dog refuse bin emptying
  • Maintaining shared areas

When dealing with the purchase of a new build property we will ensure that you are reported on regarding the future plans in relation to estate management charges. We will also ensure you are as fully informed as you can be prior to taking ownership of your new home.

How Can Timms Help?

For further information, please contact a member of the Conveyancing team on freephone 0800 011 6666 or via email at legal@timms-laws.com.