I am in my 70s and have lived in the same apartment for 20 years. Previously we managed the 25 apartments across three blocks and kept the costs reasonable. Several apartments are rented out, a few are owner-occupied and several are owned and let by relatives of the owners of the present management committee. The recent meeting voted to increase management costs to €3,000. I feel there is a conflict of interest there.
I am a pensioner, and these costs are causing me distress. Is there any way to monitor the management, regarding costs and so on? Just to add, the majority of private let owners don’t get involved with the committee.
A good starting point for your owners’ management company (OMC) to navigate the budgetary complexities it faces would be to have an appropriate representation of members on the board of directors. A blend of directors of owner-occupiers and investors benefits all the members with a balance of long-term investment requirements and day-to-day expenditure.
In your case, participating in the management of the development as a director will ensure that pensioners are represented, and your years of knowledge can be shared. The process of setting proposed budgets each year would include your views as a director and provide you with all the information that is available into making up the budget for the next year.
‘Management fees at my development have been raised too high for pensioners like me. What can I do?’
Will my son have to pay stamp duty on part of house he acquires from his ex?
Is apartment block management obligated to make doors suitable for owners with disabilities?
Are home-buying grants available to us as returning emigrants?
[ Some owners in my apartment block have approved a huge levy, and I’m not happyOpens in new window ]
Budgets should have an informed allocation for both the annual projected costs for general current account expenses and future costs funded and available within the separate sinking fund account. A chartered property and facilities manager would send detailed monthly reports to the board of directors, allowing for the monitoring of costs. Members of the OMC would have a much smaller quantum of information than say a director who is involved in regular operations.
The budget for each year needs to be sent out to all members in advance of the meeting. This allows the members to review and consider the proposal before a decision at the meeting is made and voted on. If the agent of the development is proposing to provide numerous services in-house as well as their agency, it is best practice as per the SCSI code of practice – “Property Management in Multi-Unit Developments” – to show the services in the budget that are not being procured on the open market. This provides transparency for all the members who may not be aware of all services being contracted in the binding letter of engagement that only directors would tend to see.
The democratic process of voting for a budget by the members has its shortcomings as all will not agree. There will always be conflicting views and opinions on different issues depending on people’s priorities and concerns. Some may be focusing on an exit strategy, for others their chief concern may be on-site comforts or, as in your case, tighter cost controls.
Paul Huberman is a chartered property and facilities manager and a fellow of the Society of Chartered Surveyors Ireland
Do you have a query? Email propertyquestions@irishtimes.com
This column is a readers’ service. The content of the Property Clinic is provided for general information only. It is not intended as advice on which readers should rely. Professional or specialist advice should be obtained before persons take or refrain from any action on the basis of the content. The Irish Times and it contributors will not be liable for any loss or damage arising from reliance on any content
