Change of managing agents of leasehold flats

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    Change of managing agents of leasehold flats

    IS this allowed?
    The freeholders` managing agents, (sister compnay of the freeholder company of 10 years) have informed all leasholders of this purpose built block of 30 flats, that the managing of the block will now be done by a different company.
    This is without any consultation with any leaseholders, nor any reason given.
    What is odd is that after 10 years of pretty usless managing (removed sinking fund, overcharged on Insurance, only ever made one visit to the block,) and over the last 3 years has doubled the fees they charge.
    And having given a budget for 2020 (which was not negotiable) which again increased their own charges, promptly informed us that they wil no longer deal with the block, except for invoicing for the ground rent, on behalf of the Freeholder.
    So what we now have is a totally unknown managing agent, who have inherited a high managing agents fee for our area (this is a smal market town) not a major city, and who are 125 miles away from the block.
    Google reviews of the original company support our own feelings of that managing agents (clearly they are not good at block management) as in principle they are a letting agency.
    The new company which happens to be no more than a mile away from the former, (not sure if any tie up between the two!!) has Google reviews which mirror that of the former.
    Of course time will tell if they are any good (ie they might even think about planning for the future) instead of simply invoicing us for charges.

    Is this in fact legal without consultation? Can it be challenged? Can the agents fees be challenged. Ought we to expect to see an early visit to the block to inspect it, considering the former agent has not visited for over 4 years. (odd as their sisiter company is still the freeholder)
    Or do you think the freehod may now be sold??
    Nobody can understand why this would have happened with out some ulterior motive .


    #2
    As long as the contract is for no more than one year, it is perfectly legal. No managing agent that knows anything about the job will request a contract of more than a year at a time.

    Note that you can always "negotiate" by asking the FTT to rule on the reasonableness of the charges.

    Comment


      #3
      You can also exercise your right to manage, but be warned this is not the perfect panacea as it is vulnerable to problems with getting leaseholders to pull their weight, failures to track legislation, if you don't use a good managing agent, and control being taken by small cliques of leaseholders, or hijacked by the managing agent.

      Comment


        #4
        Hi
        Well I have not seen anything other than an email from the former agent, tellng us this is the case. So for sure I have no idea if that is a contract for 1 year, maybe I should ask the new agents?

        Yes I have thought about RTM, but as it is approx 75% of the flats are now tenanted out, and owners live all over the place, so there are not enough local people to manage it without a service agency. And no one savvy enough to do it anyway. As long as landlords are getting their rents then it is clear they dont care what happens to the fabric of the block, its gardens or general appearance. Makes it hard for owner occupiers to get anything done.

        Comment


          #5
          Originally posted by stum View Post
          IS this allowed? ... Is this in fact legal without consultation? Can it be challenged? Can the agents fees be challenged. Ought we to expect to see an early visit to the block to inspect it, considering the former agent has not visited for over 4 years. (odd as their sisiter company is still the freeholder)
          Or do you think the freehod may now be sold??
          Nobody can understand why this would have happened with out some ulterior motive .
          So you want consultation do you? Have you not understood leasehold?

          Are leaseholders entitled to see the agency contract? Does there even have to be a written agency contract?

          The FH does not have to consult on changing agents. As for QLTA protection, read LRX-29-2018. A FH claimed to have a verbal agreement with an agent that was renewed by phone every 364 days. Case won.

          There are more holes in leasehold 'rights' than a teenager's underpants.

          If the freehold is to be sold, leaseholders have rights of first refusal. Why not organise now and form an RTA. It will be useless other than a means to keep in contact. Might get people warmed up for RTM. It does have its flaws but none as bad as not having RTM if leaseholders don't own their freehold.

          The ulterior motive could be either to make good use of the variable service charges and major works opportunities or a desire to provide reasonable management at a reasonable cost.

          Do not read my offerings, based purely on my research or experience as a lessee, as legal advice. If you need legal advice please see a solicitor.

          Comment


            #6
            Originally posted by stum View Post
            And no one savvy enough to do it anyway.
            There is loads of free advice online about exercising RTM. No harder than planning a road trip. Just be careful to qualify. Hard part is contacting all the leaseholders. If you can get a few to form a TA even if it doesn't yet qualify for recognition as an RTA at the property court (worthless anyway in my experience) you might open an account to collect funds to at least download the extracts of all the leasehold titles to get contact addresses of the neighbours. Write to them as a TA and ask them to join it and also consider RTM. Depending on how many flats, might be doable. RTM needs one person to do the leg work and inform the rest. If they still don't want to act, avoid pleading and hoping they will or you could end up running the company alone with a few observer directors clapping you on. Got that tee shirt.

            Do not read my offerings, based purely on my research or experience as a lessee, as legal advice. If you need legal advice please see a solicitor.

            Comment


              #7
              If it has mainly gone absentee landlord, RTM or enfranchisement are unlikely to work well in the long run.

              As the OP says absentee landlords don't care about having the building maintained, although they might start to care if the service charges increase. They generally see it so infrequently that they have no idea what is going on.

              Comment


                #8
                Stum ,

                1. If your lease is a 2 party agreement between Lessor and Lessee , the freeholder will appoint the managing agent to run the service charge account. If your lease is a 3 party agreement between the Lessor, Management company and Lessee , then the Management Company will appoint the managing agent .

                2 For 2 party leases , the Leaseholders living in the block of flats can form "Residents Association" and use the RA to ask the freeholder for a local managing agent to be appointed. This may not work if the freeholder refuses to co-operate.

                2. As alternative to forming RA , the a group of resident leaseholders ( with 51% support from leaseholders ) can set up a RTM company to claim the right to manage the service charge account from the freeholder. The RTM company appoints a locally based managing agent company to handle all service charge account work. Some RTMs fail because the self -management expertise is lost when the "manager " moves on.

                3. I would suggest you identify a suitable local managing agent before you start to set up the RTM company and contact the other leaseholders for support.

                Comment


                  #9
                  Thanks for all replies.
                  Yes I dont really understand why absent landlords do not care about the state of the gardens or the common areas, or keeping the terms of the lease (managing agent doesnt seem to care ether), it has been clear that lower rents and periods of flats being empty have increased since the block has deteriorated, even renters prefer elsewhere. Its all a slippery slope in my opinion, with similar problems in selling and valuations compared with newer, better managed flats.
                  In terms of who is the managing agent, it is not a concern that it has been given to a different company, (it couldnt be worse) it is the fact that the value of that contract having been increased without any justification over the past 3 years, should not just be transferred without leaseholders having some idea of how good or no good that new agency is.
                  From our viewpoint an agency closer to the flats would have been preferred, at least they could come to look at the place from time to time to make sure that all works are being carried out correctly (would any landlords employ a letting agency 125 miles away from their property? I think not). But of course they might only be concerend about protecting the inside of the flat and not the goings on outside.

                  The lease is the 2 party type.
                  Indeed up until 10 years ago (before my time there) there was a local residents association in place. But as I remember the main person left the block and the other original residents all moved or died, and as such the RA stopped. Again my understanding is that the pleace ran much better but as I said, at that time it was mainly if not 100% owner occupied, and of course it was 10 years newer with few if any tenants.

                  I have thought about setting up a RA, but am only living there 70% of the time.
                  But I think that despite that I will ask the freeholder and guage their response. Of course it will mean that we would be doing what I think should be done by the paid managing agency.

                  Comment


                    #10
                    They don't care because there is no financial advantage to them, given that renting is a sellers' market and they expect to sell the property itself on to another landlord.

                    Enforcing covenants may actually be to their disadvantage, as they may be the ones breaching them (e.g. restrictions on, or fees for, sub-letting), and they certainly aren't interested in policing tenants.

                    Comment


                      #11
                      Stum,

                      What L64 says " they don't care " is 100% correct. And L64 is doubly correct on saying "they certainly aren't interested".

                      If your building has had 10 years of useless management and 10 years of overcharged buildings insurance, I am sure even the off-site flat owners will see some benefit in supporting RTM. When you tell the off-site owners that high managing agents fees for property in small market towns, damages the property price , you should gain their support .

                      The sale price of any flat in a well maintained building can achieve 100% of market value but if the building condition has been allowed to rundown, the sale price may only achieve 80% of market value.

                      Comment


                        #12
                        My impressions are that:

                        - The communally maintained parts have to be in quite a bad way before the buy to let capital price starts to suffer;
                        - Safety issues have no real impact at all;
                        - Absentee landlords tend to look at the Zoopla valuation, rather than making their own judgements, and those will need several low price sales before they start dropping.

                        One of the reasons for the price not being affected much is, at least where I live, there seems to be a rental that achievable for a two bedroom flat that applies to the whole area.

                        Comment

                        Latest Activity

                        Collapse

                        • Reply to Service charges according to floorspace vs lease stipulation
                          by sgclacy
                          So the new lessee who wishes to challenge the proportion would have seen BEFORE he purchased the flat what percentage he was to pay - the unfairness of the bargain was patently clear BEFORE he purchased and may we’ll have been reflected in the price paid for the flat. So notwithstanding all of that...
                          28-01-2022, 22:45 PM
                        • Reply to Water Leaks Again and Again and Again...
                          by bigalxyz
                          There's no single cause - there have been multiple leaks - each time a different cause. Blocked bath overflow, leaking washing machine hose, leaking toilet cistern inlet, failed balloon valve in toilet, shower screen not fitted properly...all kinds of things. Just general neglect. Owner's never there,...
                          28-01-2022, 22:32 PM
                        • Water Leaks Again and Again and Again...
                          by bigalxyz
                          Director of RMC - 11 flats in London
                          There seems to be a long standing problem with the plumbing in the bathroom of one of the flats. 4 water leaks in the last 18 months, causing damage to the flat below.

                          Is there anything the RMC can do to compel the leaseholder of the problem flat...
                          28-01-2022, 16:05 PM
                        • Reply to Water Leaks Again and Again and Again...
                          by bigalxyz
                          Thank you.

                          I plan to leaf through the lease at the weekend - there may well be clauses along the lines that you suggest (it does ring a bell). Also I do know that there's a clause along the lines of "leaseholders mustn't do anything to mess up the insurance of the building, and are...
                          28-01-2022, 22:30 PM
                        • Reply to Water Leaks Again and Again and Again...
                          by Macromia
                          What it says in the lease is mostly what you have to rely on. I would be looking for any clauses that the flat needs to be kept in a good state of repair, and in particular anything that mentions keeping the pipes that serve the flat in a good state of repair and replaced when necessary and anything...
                          28-01-2022, 20:53 PM
                        • Reply to Licenced Garage
                          by Pariah81
                          We have around 5 individual garages and another garage with 3 parking spaces (I refer to that as the communal garage). Each parking space in the communal garage is allocated to a specific flat.

                          Whilst the document tries to convey it is assigned on licence, from the case law I have read,...
                          28-01-2022, 20:41 PM
                        • Reply to Service charges according to floorspace vs lease stipulation
                          by Macromia
                          If three out of four leaseholders, where all four share the freehold, stand together in opposition against the fourth, that is by definition the three 'ganging up' against the fourth. The fact that the same system may have been in use previously, and may even have been willingly accepted by previous...
                          28-01-2022, 20:39 PM
                        • 87 Years left on Lease - Cant buy freehold until 2 years?
                          by pt888
                          A property recently came back onto the market for the reason being that the previous buyer was unable to lend money from his bank due to the lease only having 87 years remaining, the estate agent therefore said that going forward only cash-buyers would be considered. Out of those cash buyers i was selected....
                          28-01-2022, 20:38 PM
                        • Reply to Water Leaks Again and Again and Again...
                          by Gordon999
                          You need to inspect the bathroom and determine the cause of water ingress to flat below . If there is a shower head , the water spray may fall into the gap between the bath and wall. If there is no shower spray, the pipes under the bath may be loose .??

                          If the bath user forgets...
                          28-01-2022, 20:22 PM
                        • Reply to Who owns loft space when it is not stated in lease.
                          by Babyspice
                          vagabond does ur lease state to whom has the roof been demised to? Who is responsible for insuring/repairing and rebuilding (in case of fire)?

                          i am currently progressing a loft conversion application with the FH, and even though my lease does not specifically mention the loft space, since...
                          28-01-2022, 18:27 PM
                        Working...
                        X