Our experts advise readers on their property problems
Waiting to get a charge settled
Q I am trying to buy a townhouse in a development but there seems to be a delay due to the management company signing off on the previous owner. Seemingly they didn’t pay the fees and there is some sort of charge against the property. What can we do to speed it up?
A When a charge has been registered against a property, it should be discharged in full by the vendor prior to title being transferred. As with a mortgage, when a property is being sold where there is a charge registered against it, the solicitor for the vendor will, in ordinary circumstances, undertake to the purchaser that the charge will be satisfied in full from the proceeds of the sale and the property title will pass unencumbered. The solicitors’ undertaking should be accepted by your solicitor as confirmation that such charges will be settled as part of the transaction.
It is not a simple process to register a charge on a property, it is time consuming and costly and it should not be necessary for an owners’ management company to have to pursue one of its members for service charges that benefit the entire community of owners.
Many directors of owners’ management companies are reluctant to initiate legal proceedings against their co-members and neighbours and will offer a range of payment options to people encountering difficulty in paying service charges. The obligations to pay service charges, contained in the title for each property, will normally require payment in advance either annually, bi-annually or quarterly. Payment must be in advance as the owners’ management company requires funding to procure all the services it is obliged to provide such as insurance, waste management, fire safety system maintenance, and electricity.
Owners’ management companies are not in the business of risk and are entirely dependant on 100 per cent of service charges being collectable. To discount any amount of the service charges due on the property would have the inequitable and unfair impact of increasing the cost to those owners who have paid and continue to pay service charges.
It is worth noting that service charge debts due by owners in a multi-unit development are fully accounted for in the annual accounts and balance sheet of the owners’ management company. Writing off any service charge debts has the effect of distorting the accounts and may reduce the ability of the company to meet its liabilities and financial obligations.
One hopes that, in this circumstance, the owners’ management company will receive the full service charges outstanding together with any legal costs incurred and that when you become a member of the company it is in a better financial position as a result of the debt having been discharged.
Paul Mooney is a member of the property and facilities management professional group of the Society of Chartered Surveyors
As a tenant, am I responsible for property taxes?
Q I have just put a deposit on an apartment to rent and there is a clause in the lease which states that I am responsible for any taxes relating to the property. Is it likely that I could be liable for the property tax even though I dont own the property?
A The lease has probably been drafted by someone acting for the landlord and may therefore seek to protect their interests over yours. The lease is a contract between you and your landlord and should clearly set out each party’s obligations for the duration of the tenancy.
In my experience, taxes associated with property ownership are not normally the responsibility of the tenant. There are a number of taxes for which the property owner is liable. These include: the property tenancy registration charge required by the Private Residential Tenancies Board (PRTB); the non-principal private residence charge (NPPR), commonly known as the second home/property charge which is currently set at €200; and the household charge or interim property tax of €100. This tax is perhaps the charge that your question relates to.
All of the different ways of implementing the tax are currently being reviewed by the Government – ie market value based, site value based and area based tax – but the responsibility for payment of the tax is the property owner’s as opposed to the occupier’s at the moment.
This is unlike the situation in the UK where the tax is payable by the occupier. However, details of the “full” property tax in Ireland have yet to be published.
My advice is to discuss this with the landlord or his agent and query the specific provision in the lease where it states that the tenant is responsible for any taxes relating to the property. If you are not satisfied with the response, you could consult a solicitor who is familiar with landlord and tenant legislation. Other sources of information for tenants include Threshold, which has an excellent web site at threshold.ie.
If necessary you can make a formal complaint through the Private Residential Tenancies Board (PRTB) at prtb.ie.
Gerard O'Toole is vice chair of the western region of the Society of Chartered Surveyors Ireland. scsi.ie
What will it cost to sell my home?
Q I AM selling my home and before I start phoning around the local estate agents, can you tell me what fees I am likely to incur and any other expenses involved in selling my house?
AThe main expenses incurred in selling your house are the agent’s fees and advertising costs. Usually the agent’s fee is a percentage of the sale price of the property. This method incentivises the agent to secure the best possible price for you.
Advertising costs can vary and it will depend on whether you choose to have your property advertised in the newspaper or online, or a combination of both.
I recommend that you ask any agents you call about the specifics of these expenses.
I would also suggest that, while fees and expenses are a significant consideration in your choice of estate agent, they are not the only ones you should consider when selling your house.
In the current market, selling your home can be challenging – in particular depending on the type of property that you have and where it is located.
Buyers are very discerning and mortgage finance still appears to be very difficult to secure.
In my opinion, you shouldnt necessarily choose the agent who quotes you the lowest fee.
A good agent can make all the difference in achieving the best possible outcome of the sale and you should consider their experience, reputation and qualifications.
Furthermore, you should inquire as to whether they have sold properties similar to yours recently.
The new Property Services Regulatory Authority (PSRA) has begun to license and regulate agents individually and this will ensure that licensed agents are fully qualified and that clients have a robust redress mechanism if they are not happy with the service. See npsra.ie
Rowena Quinn is a member of the Residential Agency Professional Group of the Society of Chartered Surveyors Ireland
