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Dealing with an unreliable management company


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Are management companies regulated and is there anything you can do if one is misbehaving?

 

A friend of mine is thinking of selling his  London flat near Shorditch and it might be a good opportunity for me.  I used to live with him so know the property's  pros and cons, he bought it off-plan and has lived there about 10 years before renting it for about 2 years.  Its worth in the region of £550k which is double what he paid, its recent value has dropped post brexit

 

He's had a lot of problem with the management company which would be the biggest con,  I've not gone into the details with him but basically the service charge seems to fluctuate yearly, two years ago it was £1,000 then last year it went up to £3000 and he's not sure what it will be next year.  I expect this is broken down by the service rate and then maintenance and repair costs but its not clear,  the issue is that costs are not forecasted well.

 

My friend is competent and tried to get other owners in the block to work together to get a better service but they are not interested and prefer to in-fight. He's also pretty despondent with the management company after poor service for so long which is one reason he's thinking of selling. 

 

If there's nothing I can do to get good service from the management company I'll probably pass so looking for input.

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They are regulated, but it is pretty toothless, about the only leverage you have is that the MA has to pay the regulator to deal with each case that gets to them, I think it is about £80.

 

So in the dealings with the MA, frame every question as an official complaint, jumping thru whatever hoops they put in the way, that way you will get an answer within 8 weeks, or at least get the regulator to ask them for you.

 

In a building with no commercial element, nor council/housing assoc involvement, you have a right to take over managing the building if you can get a majority of leaseholders together, once you have the RTM, you employ a MA, as you are then the boss, service should be better.

 

On the whole it sounds like a good way to destroy your friendship, tell him you could not make the numbers work etc., and run...

 

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Actually my friend told me about the management company problems to put me off getting involved so our friendship will be fine :)

 

Its ok though as I  ran the numbers through one of the spreadsheets Rob provided in the course section and the figures are not worth it.

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